But it’s ok, because he’s a liberal.

Michael Lind in his recent article argues that the South is rising up again, this time in an economic civil war against the North. My first reaction was to think, “Well, at least he didn’t call us Nazi’s”. That’s progress. But because of the North-South divide of the auto bailout, yeah, the Civil War analogy is the nearest weapon at hand.

It’s hard to know where to begin with this intellectually lazy piece, but let’s start with the “race-to-the-bottom” business. Lind describes Southern strategies for employment as a “race to the bottom” by providing a low tax environment and cheaper labor. Labor was cheap in the South in the early part of the century for a simple reason, they didn’t have any jobs. In the thirties, what Lind and other talking heads would refer to as, “the glory days”, if a Southerner wanted to get a good wage job and didn’t come from the right family or own enough property, there was one good option…move North. That is, until the Tennessee Valley Authority handed out shovels for us to lean on. This is the model to which Lind wants to revert. When he says more money will flow from Blue states to Red States, he means that more government jobs must be created. You know, more road projects and more ditches dug, and more Southerners leaning on shovels.

Toyota is now edging GM in terms of market share. Japanese and German cars are superior to American cars in every division except trucks, and even trucks are close. the Toyota Prius has been around for 11 years and has been running rings around the Little Three with 40% of the hybrid market share. Building Toyotas, Hondas, and BMWs provide good jobs at $50/hr. These well paid blue collar jobs go to American citizens who pay taxes into the the system, but Lind naturally thinks that Southerners daring to get off the government teat while producing superior products that Americans actually want to buy is a race to the bottom.

Foreign car companies have been eroding away at market share for decades. The economic model of the Little Three is a failure, as demonstrated by the fact that they need a bailout despite a half century of a near oligopoly in the largest market in the world. A legacy of hostile relations between management and employees, and a top down, inefficient distribution model, and an incomprehensible groupthink preventing investment in smaller model fuel efficient vehicles are the culprits of the Little three’s downfall, not some Souther Senators. Even supporters of the auto bailout concede that bankruptcy is inevitable, they just feel that the bailout is a good jobs program. I’ve stated my ambivalence to allowing the American auto industry to go bankrupt while shoveling money into institutions like AIG making a profit on the deal, but the near consensus that these companies will come back for more, and soon, and the few concessions were made by the industry leads me to believe that the only way to innovate the American auto industry is to broker a bankruptcy. As with many tough decisions, Bush kicked the can down the road. Thankfully he bailed out a failing industry, for which he will get minimal credit, only after the GOP burned their bridges in the midwest. Politically, this kind of passive leadership is a disaster for the GOP.

There are a lot of other things wrong with this piece, but I’ll add two quick points. A raise in the minimum wage would not directly affect auto workers making well over minimum wage. But it would increase unemployment levels for a decade, similar to the glory days of the 1930s. Also, and this is a caveat that should be added to any article criticizing the flow of tax money from blue states to the South, is that states like Louisiana, Mississippi, and Virginia have a lot of blacks, and blacks use public services to a much larger degree than other groups. What they need in this country is a job, and if that job is at Wal-Mart or at a BMW plant, it is better than a TVA job, because that is the only option. Ford would rather build a plant in Brazil than build in the south, with right-to-work laws in place. Also, if Lind wants stronger unions he should get on board with a majority of Americans and support shipping illegal immigrants back to their home country so negotiations between management and labor won’t be undermined by cheap, quasi-legal labor. Perhaps he can dig up some old Mexican war related analogies.

This came in from the Coach

A Japanese company (Toyota) and an American company (GM)
decided to have a canoe race on the Missouri River. Both teams
practiced long and hard to reach their peak performance before
the race.

On the big day, the Japanese won by an entire mile.

The Americans, very discouraged and depressed, decided to
investigate the reason for the crushing defeat. A management team
made up of senior management was formed to investigate and
recommend appropriate action.

Their conclusion was the Japanese had 8 people rowing and 1 person
steering, while the American team had 8 people steering and 1 person
rowing.

Feeling a deeper study was in order, American management hired a
consulting company and paid them a large amount of money for a
second opinion.

They advised, of course, that too many people were steering the boat,
while not enough people were rowing.

Not sure of how to utilize that information, but wanting to prevent
another loss to the Japanese, the rowing team’s management structure
was totally reorganized to 4 steering supervisors, 3 area steering superintendents, and 1 assistant superintendent steering manager.

They also implemented a new performance system that would give the
1 person rowing the boat greater incentive to work harder. It was called
the ‘Rowing Team Quality First Program,’ with meetings, dinners, and
free pens for the rower. There was discussion of getting new paddles,
canoes, and other equipment, extra vacation days for practices and bonuses.

The next year the Japanese won by TWO miles.

Humiliated, the American management laid off the rower for poor
performance, halted development of a new canoe, sold the paddles, and canceled all capital investments for new equipment. The money saved
was distributed to the Senior Executives as bonuses and the next year’s
racing team was out-sourced to India .

Sadly………….. The End.

Here’s something else to think about:

GM has spent the last thirty years moving
all its factories out of the US , claiming
they can’t make money paying American wages.

TOYOTA has spent the last thirty years building more than a dozen plants inside
the US .

The last quarter’s results?

TOYOTA makes 4 billion in profits while
GM racked up 9 billion in losses.

GM folks are still scratching their heads.

IT’D BE EVEN FUNNIER IF IT WEREN’T TRUE

I got to give this to him, he’s consistent:

Last night, the House of Representatives approved a new plan that will provide $14 billion in emergency loans to the Big Three Detroit automakers. While it may be described as a compromise between the auto industry and Congress, I do not support the federal government’s continued bailing out of private businesses with taxpayer dollars.

The American automobile industry is a vital part of the national economy, but no amount of additional taxpayer money can fix the Big Three’s outdated business models. It is worth noting that none of the foreign owned auto makers who build cars in America are asking for a bailout. They had the foresight to avoid the union contracts that are burying Detroit, and they build cars that consumers want. If we would simply keep the tax collectors, lawyers, regulators and bureaucrats away from the auto industry, I am confident it would thrive.

Congress has gotten no assurance that a $14 billion “bridge loan” will not lead to a $34 billion “bailout,” as auto executives requested last week, further down the road. Detroit’s problems are myopic. Their platinum level union contracts put them at a competitive disadvantage with foreign auto makers (click here to see a brief NPR comparison between GM and Toyota). Since the unions are not offering any major concessions in exchange for the bailout, the Big Three will still go broke once the money is all spent.

Chapter 11 bankruptcy has been used successfully by other struggling corporations over the years and would allow for the renegotiation of these crushing labor contracts. New management and common sense would lead to prompt restructuring and innovative, new products that can compete in today’s markets.

Instead of increasing the debt burden on taxpayers, Congress should give American car manufacturers an immediate and drastic cut in their corporate tax rates and relief from the strict fuel economy standards passed last year. I also support the temporary tax incentive proposal set forth by Democrat Senator Barbara Mikulski, which would reward car buyers with tax deductions on interest payments, car loans, and sales and excise taxes on cars purchased through the end of 2009. These tax breaks would reduce the purchase price of a $25,000 Dodge minivan by an estimated $1,553, and would apply to loans of up to $49,500.

Each passing day reaffirms my “no” votes against the Wall Street bailout in October and against the Freddie Mac and Fannie Mae bailouts in July. I oppose bailouts as a matter of principle, but also because bailing out failed companies is like feeding sharks - they only get hungrier and you are guaranteed to attract more of them. The total unfunded liability owed by every American now exceeds $60 trillion. We have to stop spending money and stop bailing out failed private companies with debt our children and grandchildren will have to repay.

You can count on me to lay out fiscally conservative, common sense solutions to these urgent financial problems. I will keep you posted on the progress of this latest bailout, and my work to oppose it.

Thank you for taking the time to read this long email, but above all, it is a privilege and an honor to represent you in Washington, D.C.