General News - Obama weighing idea of "auto czar," aide says

__________________

I have mixed feelings about this. On one hand, I'm sick of the government giving money to industries that keep failing. These companies need to learn to manage themselves better. On the other hand, the auto industry is big in the U.S. If it fails, repercussions would be felt throughout the economy.

__________________
"Ala-Freakin'-Bama, Roll Tide Roll!" ~ Trace Adkins

I feel bad for all the workers that are losing jobs, but why should my tax money go to bail out every bank and company that mismanaged their finances. Perhaps if they had invested in electric cars, etc than they would be doing better instead of focusing on gas guzzling trucks and SUV's.

I agree with the sentiments above. Still, I am in Detroit, and I've worked on GM accounts for 14 out of the last 18 years.

I am ticked that the auto companies fought the government every time they wanted to change the cafe standards for better fuel economy. The big 3 kept claiming it would cost jobs.

I am ticked that they then realized that if they pushed trucks instead of cars, they could get around those fuel economy standards.

I am ticked that the public bought into that and started buying enormous vehicles that they did not need with no thought to fuel consumption or conservation. Most people do not need an all wheel drive giant SUV to drive their kids to school or go to the grocery. I understand if they live in remote areas/mountains/places where they need something due to the roads. But not in surburbia/cities.

I am ticked that they were so short-sighted on fuel costs and chose to build bigger bigger bigger without doing more research for after the bubble burst.

However - there is an old saying that is "So goes Michigan, so goes the country." We have been in a bad recession here since 2001. The rest of the country is only now catching up to what we've been dealing with. The ripple effect of what would happen if they go under -- the suppliers, the suppliers to the suppliers, the dealerships, sales & service, restaurants and entertainment venues, retailers - etc. It would be disastrous.

The big 3 helped the government by retooling for the war effort when called upon. And then the government allowed such open trade with asian manufacturers that we couldn't compete. Something has to be done. They were starting to turn around - their product quality has improved immensely - that is not even an issue anymore - but the financial crisis has made it that they can't get the loans to pursue research for alternative energy cars or even just continue operating. So something must be done to help.

__________________

Ok Calimari, as a "Michigander" I have a question. Off subject sorry.

I keep seeing Jennifer Granholm as one of Obama's advisors and there is lots of talk about her being in his cabinet. I get Michigan news here (live really close to the state line). I have heard for years how bad things are in Mich. so why should Obama put her on the cabinet??? It doesn't make sense to me.

There is an article I'll look up to answer your question about Granholm. As far as governing goes, she is rated quite highly. But - she is not the CEO of the auto companies. She is not the head of the auto unions. She is not the one who made the decisions that put them in this spot. She has fought to keep health insurance rates down, as those costs are killing the auto industry as well. She has fought to bring more manufacturing here to Michigan to help those who are losing their auto manufacturing jobs. I'll find that article...

__________________

It just surprises me that she can be so well liked etc when the economy is doing so poorly in Mich. I mean usually there is a huge correlation between how well a state is doing and the workings of the governor...KWIM?

Beleive me, I understand that the Big 3 got themselves in this mess on their own.

In Michigan, Granholm is well-liked by the dems, not liked by the republicans. Not surprising. I found what I was looking for - it was not an article, but the editorial from Sunday's Oakland Press. It wasn't the opinion I was looking for, but the reference to a study, which I put in bold:

Now that the election is behind us, the focus can switch to the serious issue of governing.

Michigan still has a state government, it still has budget problems and — some will say — difficulties with its tax system.

How these are evaluated depend on presuppositions and whatever is the emergency of the moment.

One organization that recently took a crack at analyzing the fiscal situation in all 50 states is the Washington D.C.-based Cato Institute. Its conclusions are tied to the organization’s libertarian presuppositions and open to debate, perhaps, but the data is indisputable.


Cato graded the governors on their taxing and spending records — governors who cut taxes and spending the most received the highest grades, while those who increased taxes spending the most received the lowest grades.

Overall, the study, directed by the institute’s Chris Edwards, says “fiscal policies need to be improved if the states are to meet the huge challenges ahead. Medicaid costs continue to rise, state debt is soaring and the pension and health care plans of state workers have huge funding gaps.

“At the same time, rising international tax competition makes it imperative that states cut tax rates to attract jobs and investment. Governors don’t have an easy job, but they do need to pursue more aggressive fiscal reforms to meet the challenges of an increasingly competitive economy,” the study said.

State tax revenues increased at an average annual rate of about 6.5 percent between 2003 and 2008. State general fund spending rose at an average annual rate of about 6.2 percent between 2003 and 2008, the study said.

The report assigned scores and grades. Scores ranging from 0 to 100 were calculated for each governor based on seven tax and spending variables, and then those scores were converted to the letter grades A to F.

By now you are eager to hear Michigan Gov. Jennifer Granholm’s grade. It was a D.

Her problem was not spending; it was taxation.

Granholm’s score on spending was good — 75, compared to the national average of 50. Spending for 2008 rose just 2.6 percent while the national average for states was 5.6 percent.

On taxes, however, Granholm’s score was 32 compared to the national average of 50. The top individual income rate rose 0.25 percent, the top corporate income tax rate rose 1.09 percent and cigarette taxes went up 75 cents in 2008.The Cato study said Granholm has presided over one of the slowest-growing states in the nation, “and her tax increases have not helped matters. The biggest tax change in recent years was to the Michigan Single Business Tax. The tax was generally hated by businesses, and there was wide agreement that it should be repealed.

“In 2007, Granholm and the legislature agreed to replace the SBT with the Michigan Business Tax, but the new tax is turning out to be just as complex and unpopular as the SBT, and it may cost businesses more money. The top personal income tax rate was increased to 4.35 percent, and a tax surcharge of 22 percent was imposed on the MBT.”

Liz Boyd, a spokeswoman for the governor, took exception to the Cato study.

“We made very tough decisions in a difficult economy to protect education, safety and health care,” Boyd said. “The decisions were bipartisan.”

She pointed to states such as California, where tough decisions weren’t made and the state government is on the verge of bankruptcy.

“The MBT cut taxes for seven out of 10 businesses as well as personal property taxes for industrial and commercial taxpayers,” Boyd said. “The most criticized part of the MBT — the gross receipts base — was a contribution of the Republican-controlled Senate to the agreement that was ultimately reached.

“Finally, the report ignores that the governor has resolved over $6 billion in budget shortfalls since taking office in 2003.”

Boyd also pointed to a study earlier this year by the Pew Center on the States and Governing magazine for recognizing Michigan as a leader in government performance.

Michigan received the highest score of any Midwestern state and scored higher in three out of four categories judged — information, infrastructure and people — and fell only slightly in the money area, which evaluates states’ budgets. Only Utah, Virginia, and Washington scored higher than Michigan.

“Michigan is a very good example of a state that has been well managed in the toughest of economic circumstances,” said Susan Urahn, managing director of the Pew Center on the States.

Pew and Governing found that Michigan demonstrated an improvement in its strategic work force planning, project monitoring, performance auditing and evaluation, and its online service and information. In fact, the report credits Michigan’s state Web site — SOM - State of Michigan — as a national model for the way it allows citizens and businesses to perform a variety of transactions that save the state money.

There are many ways to measure state government performance. Again, so much depends on your presuppositions.
------------------------------------------

So, as far as a cabinet appointment goes - I don't know if she'll get one. But her lower rating was due to taxes - not due to spending. She has cut government spending in Michigan a great deal. And a lot of the taxes that she has done was replacing one tax for another, and that didn't really go over well. So, she has done very well fiscally, but all the governments are hurting for money right now because, like everyone else, their investments are down too.

Is Granholm Michigan's bestest governor ever? Nah. Is she the worst? Not by a long-shot. I've no idea what other support/work she's given to the campaign that might result in some job offer, other than helping Biden prep for his debate.

__________________

I agree. That's one reason I have limited sympathy for Michigan's woes. People keep electing back in the same people despite their state failing. While I feel sorry for the "individuals", I think if they were smart they'd change course and see if the state would improve. JMO

__________________

Well, in all fairness, she is only in her 2nd term, and the last race was VERY close. And we had Kevorkian's attorney Geoff Feiger run for governor, so give us some credit. AND - her legacy will be that she removed Kwame Kilpatrick from office, IMO. And the people are VERY happy for that. And I really don't see what a governor could do re: an auto industry that put itself on this path 20 years ago. She has been asking for intervention/meetings with Bush about the industry since Bush's first term, so it's not like she hasn't tried to get attention put on Michigan. Actually, that is why we had our primary vote moved up - remember that last year? It was to make the candidates notice Michigan because we keep getting ignored even though we are in crisis.

__________________