GOODY TWO SHOES: The Definition Of Chutzpah: Part III
Just a few days ago, it was hard-hearted Repubs like Sens. Jon Kyl (AZ) and Arlen Specter (PA) who were dead-set against throwing bailout money into the bottomless pit that is Detroit’s Big Three automakers, and feel-your-pain Dems like House Speaker Nancy Pelosi (CA) and Senate Majority Leader Harry Reid (NV) who were pressuring Treasury Secretary Henry Paulson to “save jobs” (pro-Dem UAW jobs, BTW).
But that was before the CEOs of Chrysler, Ford and GM proved to be jerks with perks by flying to their “gimme” hearings before the House and Senate on their corporate jets.
Rep. Gary Ackerman (D-NY) was speaking for all fed-up taxpayers when he noted:
“There’s a delicious irony of seeing private luxury jets flying into DC and people coming off them with tin cups in their hands, saying that they’re going to be trimming down and streamlining their businesses. It’s almost like seeing a guy show up at the soup kitchen in high hat and tuxedo. … Couldn’t you all have downgraded to first class or jet-pooled to get here?” he asked Alan Mulally of Ford, Robert Nardelli of Chrysler and Rick Wagoner of General Motors.
Not to be outdone, Rep. Brad Sherman (D-CA) asked the three to “raise their hand if they flew here commercial” and then to “raise your hand if you're planning to sell your jet … and fly back commercial. Let the record show no hands went up.”
Even Repubs got in on the action, with Rep. Patrick T. McHenry (NC) stating that “I'm not an opponent of private flights by any means, but the fact that you flew in on your own private jet at tens of thousands itself dollars of cost just for you to make your way to Washington is a bit arrogant before you ask the taxpayers for money.”
Calling it an “an ill-timed display of corporate excess,” The Washington Post’s Dana Milbank pointed out: “There are 24 daily nonstop flights from Detroit to the Washington area.” And The New York Times calculated the cost:
Wagoner's private jet trip to Washington cost his ailing company an estimated $20,000 roundtrip. In comparison, seats on Northwest Airlines flight 2364 from Detroit to Washington were going online for $288 coach and $837 first class. …
Mulally made his case Tuesday before the committee saying he's cut expenses, laid-off workers and closed 17 plants.
"We have also reduced our work force by 51,000 employees in the past three years," Mulally said.
Yet Ford continues to operate a fleet of eight private jets for its executives. Just Tuesday, one jet was taking Ford brass to Los Angeles, another on a trip to Nebraska, and of course Mulally needed to fly to Washington to testify. …
GM and Ford say that it is a corporate decision to have their CEOs fly on private jets and that is non-negotiable, even as the companies say they are running out of cash.
But the cushy roundtrip between Detroit and Washington ultimately proved costlier to the automakers than the differential between a seat on a private jet and a first class seat on a commercial flight: Congress sent Nardelli, Mulally and Wagoner back to Detroit empty-handed because “the industry lacked credible plans to return to profitability,” reports The Wall Street Journal. “Until they show us the plan, we cannot show them the money,” Pelosi said.
Citing AIG, which has put two of its seven jets on the block, and AK Gov. Sarah Palin, The Times suggests that the Big Three sell their company jets and “deduct what they make from the sales from the cost of the taxpayer-funded bailout they are seeking.”
By the end of the week, GM bowed to the realities of bad press and announced that it is paring its fleet of leased corporate jets down to three because “We understand the symbolic issue of people showing up in Washington in corporate jets. We're very sensitive to that,” Tom Wilkinson tells Dow Jones. The company insists private planes are necessary to fly its top dogs to locations not served by commercial flights. The Stiletto has some advice: Until the company is on sound footing, go Greyhound.
To read other posts in the “chutzpah” series, click here (second item) and here.
Editorial Note: Nardelli, Mulally and Wagoner aren’t the only hypocrites in this sad saga. On January 14, 2008, the day before the Detroit primary - one of just a handful he won - Fmr. Gov. Mitt Romney told the Detroit Economic Club:
"In fact, in face of all of the existing burdens that weigh down our domestic auto industry, instead of throwing over a life preserver, Washington has dropped yet another anvil on Michigan with higher CAFE standards. And now, it's passively sitting back to see if the car companies can swim. And the answer is: just barely. …
"A lot of Washington politicians are aware of the pain, but they haven't done anything about it. And of course, I hear people from time to time say, 'Well, that's Michigan's problem.' Or, they say something like, 'Well, it's the car companies. They just brought it on themselves.' …
"Michigan's economic worries should be America's worries. I don't know about the Washington politicians, but I can tell you this: if I am President, I will not rest until Michigan has come back!
"I am convinced that Michigan can once again lead the world's automotive industry. But it means we're going to have to change things in Washington. We're going to have to go from politicians who say they are 'aware' of Michigan's problems to have a President instead who will actually take action to do something about them. …
"Now, I know that there are some people who don't think that there's a future for the domestic automobile industry. They think that the industry and its jobs are gone forever. And they're wrong. …
"The pessimist says that the hundreds of thousands of jobs that have been lost, have been lost forever. That logic of course says that the 200 jobs that were lost last week at Willow Run, they're lost forever too. And by the way, that logic would also say that all the rest of the jobs in the auto industry will one day be gone forever, and there's nothing that can be done about it.
Less than a year later, Romney wrote this op-ed for The New York Times (“Let Detroit Go Bankrupt “):
If General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.
Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course - the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check. …
The American auto industry is vital to our national interest as an employer and as a hub for manufacturing. A managed bankruptcy may be the only path to the fundamental restructuring the industry needs. It would permit the companies to shed excess labor, pension and real estate costs. The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.
In a managed bankruptcy, the federal government would propel newly competitive and viable automakers, rather than seal their fate with a bailout check.
Once again Romney reminds us all that the man they vote for on Tuesday, is not the man they get on Wednesday – another reason (second item) The Stiletto will oppose his candidacy should he decide to blow even more of his children’s inheritance on a second presidential bid in 2012. Noting that he “never mentioned bankruptcy” in that January speech, Boston Globe columnist Joan Vennochi ripped Romney a new one:
If the auto industry could reinvent itself as quickly as Mitt Romney, it wouldn't need a bailout. …
Indeed, Romney was never able to grasp the differences between corporate and political turnarounds.
In the private sector, dramatic retooling is key to survival. As a businessman, Romney understood how to do that. His turnaround of the Salt Lake City Olympics is often cited as an example.
In the public sector, seismic shifts in position create suspicion and undercut credibility. As a politician, Romney continues to lose his. …
Romney's op-ed column reaffirms McCain's decision to look elsewhere for a running mate. McCain knew Romney would always be a rival, never a teammate. His ambition is too naked. His finger is always in the air, not just testing the political winds but succumbing to them at first gust. …
Never underestimate Romney's willingness to shamelessly reverse direction, to get where he wants to go.
Romney doesn’t get that each time he changes direction, he will leave more and more voters behind.




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