GM, Chrysler Beef Up Lobbying, Despite Government Ownership

The government's attempts to impose safety and environmental standards on automakers is being thwarted by the very car companies it, in part, owns.

General Motors, 33 percent government-owned, and Chrysler, nine percent government-owned, partnered with other automakers this week to lobby against fuel efficiency rules proposed by the federal government, the Washington Post reports. Last year, automakers lobbied against stricter safety regulations helping stall the Motor Vehicle Safety Act of 2010 in the Senate and preventing the National Highway Traffic Safety Administration from getting the necessary power and funding to protect consumers.

Environmental organizations, safety advocates and watchdog organizations are disappointed in the government for not using their power to prevent the automakers from getting in the way of passing environmental and consumer protection laws. Ralph Nader told the Washington Post:

"Even when the government owned 61 percent of General Motors, the company was arguing against government proposals on auto safety and pollution controls," said consumer advocate Ralph Nader. "As the owner of the world's second largest auto company, the government could really have made the company a model."

While GM was getting bailed out by the government, the car company did scale back it's lobbying in Washington, firing outside consultants but keeping it's inside team, Roll Call reported.

But in the fall of 2010, as the Detroit automaker prepared to make one of the largest initial public offerings in US history, it was also quietly rebuilding its D.C. lobbying force, formerly one of the top 15 lobbying powerhouses in the capital, The Hill reported.

Since bailing out the big-3 automakers, the U.S. Treasury has been vocal about its decision to not get too involved in managing the car companies, according to the Washington Post.

While consumer advocates and others criticize the government for allowing the automakers to influence legislation, Reuters reported findings from the Congressional Oversight Panel that the Treasury's hands-off stance, influenced by the Obama administration's eagerness to cut ties with the auto industry, potentially lost money for taxpayers by not fully vetting their settlement with Chrysler Financial last year.

Comments

[rikster]

05:07 PM on 01/15/2011

let me get this right...the government is paying for Lobbyists to pander to the government...!! we are in trouble....!

[kenhamlett]

11:19 AM on 01/15/2011

It is nice to see all of our various "reforms" in action, isn't it? The more things change (or are reformed), the more they stay the same. It is outrageous that these firms are using taxpayer dollars to lobby in ways that are not necessarily in the best interests of the taxpayers who rescued them when their own (mis)management could not. The administration and Congress ought to put a stop to this post-haste, but here is a bet that says they will not. Everyone is far too busy congratulating each other on their various "successes." So, we will just pay the bill and be expected to keep our mouths shut.

[London Diplomat]

10:38 AM on 01/15/2011

Where do they get off?

First they fly to Washington for their bailout on their private jets, then they increase production in China, then finally tried to move their headquarters out of Detroit.

Do they want to be hated? Is that it? Oh well - as long as they have their voice....

[London Diplomat]

10:39 AM on 01/15/2011

Links:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aWHbmXZFhiEs

http://www.guardian.co.uk/business/2010/sep/06/general-motors-bailout-rattner-obama

[NessEliot1932]

04:46 AM on 01/15/2011

TRULY AMAZING:

1. Lobby with Government Money

2. Senators and House Members SPEND 70+% of their TIME RAISING MONEY!

[NessEliot1932]

04:49 AM on 01/15/2011

SO we elect Senators to spend 70+% of their time ACCEPTING BRIBES for their VOTES!

We MUST END THIS LEGALIZED CRIME and GET POLITICIANS TO represent the PEOPLE!

[jhendrix]

10:19 AM on 01/15/2011

If there is one issue this country can come together on, it is this. The media, both left and right, could hammer this issue day and night and change would come. It is completely ignored.

[NessEliot1932]

04:51 AM on 01/15/2011

A Constitutional Amendment to make it illegal to use private money of any kind to elect a Politician!

[London Diplomat]

10:34 AM on 01/15/2011

The irony is that it was Government money anyway...

[rikster]

05:10 PM on 01/15/2011

as long as the fox guards the hen house..no "reform" will ever happen. partisan politics supersede the common good....! Only one thing will change all of this, but that part of this comment will never get by the "moderator"....

[SteveInCT]

11:07 PM on 01/14/2011

GM is nothing more than a piggy bank for the UAW. UAW President Bob King said in a speech yesterday to the Automotive News World Congress in Detroit that the U.S. government bailout that saved Chrysler and GM also saved more than 1 million jobs, counting those at suppliers, dealerships and other related segments in addition to the automakers themselves.

The fact is that GM would have not have liquidated via a Chapter 7 bankruptcy since the company's main problem was too much debt rather than the underlying business problems. As anyone knows, GM would have filed Chapter 11 restructuring similar to what hundreds of large companies have done over the last 100 years. In a Chapter 11 restructuring, debt is eliminated while the business continues on uninterrupted.

The union leaders lied about a potential liquidation to get a governement bailout that favored the unions. What a liar Bob King is !

[nofriendofrepublicans]

08:35 PM on 01/14/2011

Your tax dollars at work.

[Gingerale]

08:17 PM on 01/14/2011

This is very, very WRONG!! Companies should not be allowed to ignore governmental regulations by hiring lobbyists. The top CEOs need to go to jail for this behavior. IF their behavior technically is within the law, then some laws need to be changed. This is a great book about our country from its founding to the recent death of Elizabeth Edwards. I've read it! It explains a lot about how we got where we are today.
http://www.e-tabitha.com/2011/01/blows-against-empire.html

[TeaLady005]

08:01 PM on 01/14/2011

The Treasury Department admitted this week taxpayers will never recover about $40 billion used to bailout General Motors. People need to be in jail over this unconstitutional act!

[Icantbelieveher]

11:09 PM on 01/14/2011

Do you seriously think that the constitution runs this country?  The corporations run this country pure and simple.  Giving it over to the republicans will only solidify the corporate control! 

There is no constitution as long as the activist supreme court continues to rule in favor of the corporations over the people!

[wikwox]

07:34 PM on 01/14/2011

If lobbying worked for Fannie Mae and Freddie Mac, why not the car companies? The god like power of lobbyists continue to amaze me, they seem to get thier way all the time. Very,very hard not to think it's the corruption and greed of our politicians.

[stape45]

07:06 PM on 01/14/2011

U.S. Government/Business. Forever intertwined.

[econ1]

06:15 PM on 01/14/2011

Unfortunately, with more and more rules and money flowing from Washington, all companies will have to increase their lobbying.

[jhendrix]

10:21 AM on 01/15/2011

But isn't it the lobbying that generates most of the rules and regulations?

[cccoyote]

05:38 PM on 01/14/2011

GM was willing to toss their entire US business out the door. Oh, we need the bailout or people will lose jobs - 2 million jobs.
Contrary though, they announced opening a new plant in china just days after grabbing their bailout check.
Fully capable of new ventures in China and India under the cloak of sub-corps, they had no means of keeping their home country business afloat.

"Beleaguered US automaker General Motors opened up a new joint venture manufacturing plant in northeast China on Wednesday which will begin churning out up to 150,000 vehicles annually beginning 2009."

http://www.financialexpress.com/news/general-motors-opens-new-plant-in-china/399643/

[London Diplomat]

10:35 AM on 01/15/2011

They even wanted to move the headquarters from Detroit:

http://www.guardian.co.uk/business/2010/sep/06/general-motors-bailout-rattner-obama

[Kenz300]

05:38 PM on 01/14/2011

Both GM and Chrysler need to spend their money on building a fuel
efficient fleet of vehicles.

Ford and Hyundai are taking market share by emphasizing:
Quality, Value and Fuel Efficiency of their fleet of vehicles.

GM has brought out a few new vehicles with better fuel economy but
they need to transform the rest of their fleet. The last time oil went to
$147/barrel people were parking their trucks and SUV's and were tripping over
each other at the foreign car dealers looking for high mileage vehicles.

The price of oil is rising again. We have such short memories.

[Craig Bowers]

09:23 PM on 01/14/2011

And some will say that the reason oil is rising in cost is because of fuel efficiency cars and that it is rude of people to buy such vehicles...

[Intolerantcentrist]

04:17 PM on 01/14/2011

Any and all corporation that received government funds or traded ownership in return for government funding should have been required by Congress to forgo their right to lobby the government. It’s called the power of the purse.

[mashtoe]

04:05 PM on 01/14/2011

It's called corporate communism folks.