Obama picks Michigan’s Granholm on the Economy – More Smoke & Mirrors

This might be funny, if it were not so sad. It is actually heartbreaking. Michigan will get what it deserves – after 6 years of Granholm – you moved her policies to Washington.

There is nothig to be gained from saying I told you so, but I told you so ……. read  https://mcauleysworld.wordpress.com/2008/09/08/michigans-dem-governor-granholm-appoves-of-obama-tax-policy-matches-her-policies-of-last-6-yrs/



This is simply tragic. Obama hasn’t been sworn in yet, but he is clearly demonstrating his intent to govern from the far left. Woe to Michigan ……….

The economic disaster will certainly worsen as predicted …….. TAX AND SPEND BIG GOVERNMENT HAS NEVER WORKED ANYWHERE AT ANYTIME. The economic turmoil of the Jimmy Carter days may look like “good times” compared to where we appear to be heading …………

Obama to hold meeting with economic advisers today


WASHINGTON — Gov. Jennifer Granholm and former U.S. Rep. David Bonior are to serve on a panel of financial luminaries and corporate experts advising President-elect Barack Obama on the nation’s hard-bitten economy, ensuring Michigan, its troubled auto industry and labor have a seat at the table.   http://www.freep.com/article/20081107/NEWS15/811070378/1/VIDEOS01                                           


If you think either Michigan or the Michigan Auto Industry will have a seat anywhere you are mistaking ……. If the Democrats were going to offer a seat at their table they could have done so years ago ….. Michigan has been sending two Democratic US Senators and a predominantly Democratic Congressional caucus to Washington for years – nothing has changed in that regard.  Remember it was Nancy Pelosi, Democratic Speaker of The House of Representatives, who demoted the “Big Three” to the “Detroit Three”. For those of you that have not caught on yet, the term “Detroit Three” is not only a derogatory insult and dismissive, but it carries far more sinister tones – As the “Detroit Three” the “Big Three” were no longer a “National” issue but became a local Michigan problem.

Pelosi and the liberal Democrats despise the Auto Industry – they want your vote on election day and spit in your face after the votes have been counted. The votes have been counted – its time to shut your eyes again …………. here comes the spit.

As for your seat at the table, watch out when you go to sit down – they are liable to pull the chair away . The talk about a “bailout”, if one takes place, is smoke and mirrors. Another corporate handout with the right hand while the left hand increases business taxes and implements policies that will inhibit US car sales. They take away more than they give ……..

You think not – then read this ……………..

The Los Angles Times

Power struggle may open rift among House Democrats

Rep. Henry Waxman wants to replace Rep. John Dingell as head of the energy and commerce committee, which will take the lead on Obama’s plans on global warming.

Reporting from Washington — Opening a split among congressional Democrats that could affect President-elect Barack Obama’s efforts to curb global warming, a California environmentalist is trying to wrest control of a crucial House committee from its chairman, who is the automobile industry’s strongest ally in fighting stricter antipollution standards.

Rep. Henry A. Waxman (D-Beverly Hills[CA]) has announced that he wants to replace Rep. John D. Dingell (D-[Detroit]Mich.) as chairman of the House Energy and Commerce Committee, which will take the lead on Obama’s signature issues of energy, global warming and healthcare. [Oh, you didn’t think the auto industry was a signature issue did you? Only “National” issues get signature status.]

Over the years, Dingell has given invaluable support to the auto companies’ fights against pollution and fuel economy standards that they considered unrealistic, and Waxman’s challenge to his leadership is the culmination of a decades-long rivalry between the two powerful lawmakers, the panel’s top two Democrats.

The outcome of the fight could affect whether action on Obama’s energy agenda will be tilted toward the interests of Rust Belt industrial Democrats or more aggressive antipollution efforts that California has spearheaded.

It opens divisions among triumphant Democrats just as they come off a landmark election that put Obama in the White House and expanded the party’s majorities in the House and Senate — and it is a window into how power struggles among Democrats may intensify now that there is so much more power to wield. [It is a window into how Liberal Democrats have thwarted economic growth while blaming the Bush Administration].

Dingell, who in the Democratic primaries endorsed the presidential candidacy of Sen. Hillary Rodham Clinton, represents a district near Detroit, and the loss of his position would be seen as a blow to the auto industry at a particularly trying time. Detroit is being battered by declining car sales, high gas prices and an economy in turmoil. In a sign of the political sensitivity of the fight, several auto industry spokesmen declined to comment on the choice between Dingell and Waxman.

House Speaker Nancy Pelosi (D-San Francisco[CA]) is officially neutral in the dispute, but she is known to be sympathetic to Waxman’s positions on the environment and has repeatedly crossed swords with Dingell over the years:


* In 2002, Pelosi endorsed an unsuccessful primary challenger to Dingell.

* In 2007, she set up a special panel to address global warming, a move that was seen as a way to circumvent Dingell.

* Last year, she and Waxman fought against a Dingell global warming bill that would have prohibited California and other states from taking tougher action than the federal government to reduce greenhouse gas emissions.

[Officially neutral, who are they kidding?].

Dingell supported that provision because, he said, it was easier for auto companies to comply with a uniform national standard than a patchwork of state laws, and Waxman and Pelosi saw it as a direct shot at California’s landmark law to cut tailpipe emissions. The provision was dropped from a global warming draft bill Dingell circulated this fall.

[Question the scientific validity of Global Warming? See: http://wattsupwiththat.com/2008/09/

Waxman’s feud with Dingell is even longer-running. Throughout the 1980s, as they rose in seniority on the energy and commerce committee, the two battled over clean-air laws, toxic waste regulation and other environmental issues.

As chairman of the House Committee on Oversight and Government Reform, Waxman has been a thorn in the Bush administration’s side with frequent hearings and reports critical of its performance. But now that a Democrat will be in the White House, that oversight role may not be as appealing to Waxman as the chairman of the energy and commerce committee, which has jurisdiction over many issues important to the new administration.

“In large measure, our success as a Democratic caucus will depend on how the commerce committee performs,” Waxman said in a letter to Democrats announcing his plans.

Environmentalists are delighted at the prospect of a Waxman chairmanship.

“It is much more likely we will advance a progressive, forward-looking agenda with a progressive, forward-thinking leader like Waxman than with an old bull who defends Detroit like Dingell,” said Dan Becker, director of the Safe Climate Campaign, an environmental advocacy group.  http://www.latimes.com/news/nationworld/nation/la-na-energy7-2008nov07,0,7068890.story?track=rss  

They couldn’t demonize Dingell anymore than this, even if he were, say, a Republican. So Dingell is now being protrayed as an anti-environmental zealot.  This is no accident. Do you think any Speaker of The House has previously endorsed a Primary challenger over a Representative with 53 years of party senority in Washington. Dingell is the longest serving US Representative currently in Congress. (1955 to date). In the history of the United States only 1 Congressman has served longer. Wait, just a minute, he supports the right to own guns too …. he has just gotta go. http://en.wikipedia.org/wiki/John_Dingell 

As for being anti-environment, consider these comments made on December 20, 2006, “The formidable Democrat from Michigan, now 80, has served 51 years in the House of Representatives — the second-longest of any congressional career in history. During that time, he played a key role in pushing through many of America’s cornerstone environmental laws, including the Wilderness Act, the Endangered Species Act, the Clean Air Act, the Marine Mammal Protection Act, the National Environmental Policy Act, and the original Corporate Average Fuel Economy (CAFE)“. http://www.grist.org/news/maindish/2006/12/20/dingell/  

Considering this track record on environmental issues, what was the bottom line in this article, “That’s why some environmentalists see Dingell as the single biggest roadblock on the path toward meaningful climate policy in the 110th Congress”. 

What? Wasn’t it all Bush’s fault? This article presents a rare opportunity to read about Democratic double dealing. Promises made only to be broken, again. Michigan’s auto industry isn’t playing “second fiddle” any longer, now it is about to lose its only chair in the band.

This writer is not a Dingell supporter, however, this is a political lynching. Dingell has been a loyal, moderate, center-left, Democrat who has obtained the trust and admiration of his electorate like none before him. Now the “new administration” is painting Dingell as representing some “fringe” element of the Democratic Party.  

If Michigan is lucky, Obama, Granholm, Pelosi and Waxman will send a few of the “windmill factories” your way when they are done. 

Ford announces $129M 3Q loss, burns $7.7B in cash – Ford to cut 2,260 workers after reporting $129 million 3Q loss                                                                                 

By TOM KRISHER and JAMES PRICHARD, AP Business Writers  http://news.yahoo.com/s/ap/20081107/ap_on_bi_ge/earns_ford   

General Motors will release its 2008 3rd Quarter results at 10:30 AM this morning.

“Due to deteriorating market conditions and a dire cash crunch, General Motors CEO Rick Wagoner will be announcing “important changes” during his company’s 3rd quarter earnings report on Friday at 11AM EST The Detroit News obtained an executive level email that foretells the bad news ahead but doesn’t go into specifics ……….” http://www.autoblog.com/2008/11/06/gm-announcing-important-changes-on-friday/         The Friday announcement will likely include a hefty financial loss, too, as evidenced by an earlier announced loss of $2.5 billion by GMAC financial.

GM reports $2.5B 3Q loss, says running out of cash

DETROIT, Mich. – General Motors Corp. says it lost $2.5 billion in the third quarter and warned that it could run out of cash in 2009. GM also said it has suspended talks to acquire Chrysler. While it didn’t specifically name the automaker, GM said it was setting aside considerations for a “strategic acquisition.”

The automaker also said its cash burn for the quarter accelerated to $6.9 billion due to a severe U.S. auto sales slump. The company on Friday reported a net loss of $4.45 per share during the quarter, compared with a record-setting loss of $39 billion, or $68.85 per share, a year ago.  GM shares fell 53 cents, or 11 percent, to $4.27 in morning trading. 

A Chrysler LLC sale to GM seems unlikely -Chrysler LLC is privately held, however, Daimler AG holds a 19.9 % stake in the company –                                                   

Oct 23, 2008 – “Today, Daimler AG reported a net loss of euro 351 million for its 19.9 per cent share of Chrysler Holding LLC’s second quarter 2008 results under International Financial Reporting Standards (IFRS). On a U.S. GAAP basis, Daimler AG’s net loss for Chrysler Holding LLC was euro 88 million, of which a euro 76 million net loss is attributable to the automotive business of Chrysler LLC.” [This report allows us to project that Chrysler LLC’s loss in 2nd quarter 2008 (80.1 % stake) would approximate $352 million euro loss or $447 million dollar loss]. http://research.scottrade.com/public/markets/news/news.asp?docKey=100-297u1992-1&section=headlines                                                                    

Michigan Recession Continues to Deepen Reports Comerica Bank’s Michigan Business Activity Index – “September’s advanced figure is the lowest level in 14 years.” [That would make it the lowest since November 1994 – A Democratic Congress and the Clinton Administration – Wasn’t the Clinton Administration all “milk & honey”?].                               http://www.mlive.com/prnewswire/index.ssf?/cgi-bin/stories.pl?ACCT=MI2&STORY=/www/story/11-06-2008/0004920315&EDATE=Nov+6,+2008

Then there is Toyota – Toyota’s Q1 profit drops 39% – Posted Aug 7th 2008 6:58PM – Toyota is not used to seeing its profit margins drop, as the Japanese auto giant has enjoyed increased profit for nine straight years. Expect that run to end this year …. For the year, Toyota has revised its sales forecast from 9.06 million units to an estimated 8.74 million. For the first quarter of the year that ended in June, Toyota has also announced that its operating profit took a 39% plunge from lower sales in both the United States and Europe …. Still, Toyota sales remain fairly strong in this sinking market and a profit is a profit. We’d imagine that this is a problem any one of the Detroit 3 would love to have on its hands. http://www.autoblog.com/tag/toyota+profit/   


November 19, 2008

Waxman wins Steering Committee vote


California Rep. Henry A. Waxman accomplished a critical first step in his bid to unseat Michigan Rep. John D. Dingell atop the Eneryg and Commerce Committee, beating the chairman, 25-22, in a vote of the Democrats’ Steering and Policy Committee, Connecticut Rep. Rosa DeLauro tells Politico’s Ryan Grim.       http://www.politico.com/blogs/thecrypt/


November 19, 2008

Waxman wins Steering Committee vote


California Rep. Henry A. Waxman accomplished a critical first step in his bid to unseat Michigan Rep. John D. Dingell atop the Eneryg and Commerce Committee, beating the chairman, 25-22, in a vote of the Democrats’ Steering and Policy Committee, Connecticut Rep. Rosa DeLauro tells Politico’s Ryan Grim.


A MESSAGE FOR MICHIGAN – Obama on Granholm “The Best Governor in the Country”

Minutes ago, while Barack was addressing a typical crowd in Detroit, he thanked his fellow Harvard Alum, Governor Granholm and referred to her as “The Best Governor in the Country”. Barack went on to state that when he is President, Governor Granholm’s polcies would lead the state out of “your economic woes”. Aparently, Obama is unaware that Granholm, thankfully, has only two years left to serve and that her first six years in office have been some of the worst in the history of the State. Not since the Carter Administration has Michigan seem times as bleak as these. 

Hold on to your seats Michiganders, Obama specifically enbdorsed Granholm’s Tax policies – can you believe that – he endorsed the Policies that have led to the economic ruin of Michigan.

Michigan – the choice is yours – Obama has told you (maybe I should say he has warned you) what you have to look forward to if he is elected to the White House.

One closing bipartisan comment – If Michigan Votes for Obama – they will be getting what they deserve. Michigan, after 6 years of Granholm, you should know better! 

Read About Obama & Granholm Tax Policy: https://mcauleysworld.wordpress.com/2008/09/08/michigans-dem-governor-granholm-appoves-of-obama-tax-policy-matches-her-policies-of-last-6-yrs/ 

Compare the Granholm/Obama Tax Policy with Governor Ted Strickland’s Policies (Strickland is the Democratic Governor of Ohio – a State on the economic rebound): https://mcauleysworld.wordpress.com/2008/09/08/ohios-dem-governor-says-no-to-obama-tax-plan-says-obamas-view-of-ohio-is-wrong/

Michigan’s Dem Governor Granholm appoves of Obama Tax Policy – matches her policies of last 6 yrs

Barack Obama’s economic plan for the country doesn’t represent change. His plan isn’t new. It has been tried before, many times. President Jimmy Carter tried the same programs in the late 1970’s with disastrous results.  

Michigan’s Governor, Jennifer Granholm, has supplied us with a real life example of what happens when you put Obama’s proposed tax and spend programs in place.  Granholm’s destruction of the Michigan economy is a real life illustration of what is to be expected with an Obama victory in November.

Note that both Granholm and Obama learned their economic theory at Harvard Law School, even though Harvard Law doesn’t really teach economic theory. The theory adopted by Granholm and Obama is not the sole theory taught at that prestigious school. Why did these politicians adopt the particular theory they believe in? It might be due to the fact that neither spent their formative years in the US. (Obama in Indonesia, Granholm in Canada). They favor a more Socialist Europen Economic Model of the world. (Europe is presently in a recession and relative to the US, is in a more negative position) or it may just be that the Liberal wing of the Democratic Party has always favored this type of “progressive” tax and spend model. The conservative wing of the Democratic Party (Clinton White House) does not favor this “tax and spend philosophy”.


What has happened

Granholm, Michigan’s intensely unpopular Governor, took office in 2003. The Michigan economy had begun to slow in 2002, the year prior to her coming into office. The state unemployment rate was 6.2%, the national average was 5.7%. By the end of 2003 the jobless rate had grown to 7.2 percent, the national rate was 5.7%. There was a job loss of 35,000, however, the unemployment numbers only reflected an additional 4,000 out of work because 31,000 people left the state. 

At the end of 2004 Michigan’s jobless rate was 7.3 percent, the National jobless average 5.5%. The state lost an additional 35,000 residents and thousands of additional jobs.     

At the end of 2005 the jobless rate dipped to 6.1% while the National rate dipped to 4.2%. The State continued both its job loss and population flight.

At the end of 2006 Michigan’s jobless rate jumped to 7.2%, the National average was 5.0, one third lower than in Michigan. The State lost a net 90,000 jobs and over a hundred and fifty thousand residents.

At the end of 2007  Michigan’s jobless rate was 7.6%, the National rate was 4.9%. The state lost 120,000 jobs. 

Between 2003 and 2008 two people fled Michigan for every person coming into the state. The total  job loss (the unadjusted number of jobs eliminated from the State) totaled almost 2 million, the net job loss number is lower because auto or industrial jobs were replaced by service industry jobs.

Warning before the storm

When Granholm first took office in 2003 she announce a long list of liberal social experiments she described as “investment opportunities” to improve Michigan’s economy. Of course she wouldn’t increase the taxes of the “working classes”, just taxes on businesses and the “rich” to fund these “investments” in “infrastructure”.

The first warnings came in 2003. Numerous publications (Wall Street Journal, Detroit News, Free Press, NYT, etc) and scholars from around the country and world warned that increasing taxes in a slow or stalled economy was a risky proposition. The advise was not heeded.  



www.mackinac.org/archives/2007/bhi report.pdf



The first of the tax increases took place in 2003.




The Governor was warned that this would start a vicious cycle – increased taxes make the products or services produced in your state more expensive and less attractive – those products and services are less attractive to buyers – they buy fewer of the goods and services – delivering less tax money -meaning another tax increase is necessary and so on and so on ….. This is exactly the type of death spiral Michigan is in at this time.


www.mackinac.org/archives/2007/bhi report.pdf

How many tax increases?

The first property tax increases were made in 2003. The have continued annually. Property taxes continue to escalate out of control.




The Michigan foreclosure crisis is not fueled by adjustable rate mortgages, it is being fueled by job loss, population flight and citizens being taxed out of their homes.

Michigan currently has 1.2 million more dwellings than families to fill the dwellings. One of the darker jokes about Michigan is that the only thing slowing the population flight is the fact that home sales are so slow.

Home values and home ownership

The middle class working families of Michigan had a long history of multiple home ownership. Tens of thousands of Michigan residents had summer homes or cottages in Michigan’s “north country”. Higher property tax rates and the elimination of decades old property tax credits forced the sale of thousands of these “summer homes”, previously held by some families for generations.  

The average home price in Michigan is approximately $200,000. A home valued at $200,000 in 2003,  is now valued at $150,000. In 2003 the property tax on the $200,000 house was $3,000. The tax today on the $150,000 home is $7,000.      

The Michigan sales tax increased from 4% to 6%.

Business and personal income taxes have been increased repeatedly. Michigan’s Single Business Tax was replaced, to create a better business climate and “lower taxes”. The replacement, the Michigan Business Tax,  was not only, dollar for dollar, identical to the prior tax, but the rates have been substantially increased.

As the Michigan economy continued a downward spiral the warnings continued throughout 2004, 2005 & 2006. Pundits and professors warned – STOP THE TAX INCREASES. The warnings were not heeded.


Taxes have continued to increase year after year.

In November 2007 a huge additional tax increase was passed. Business taxes went up 22% and  other taxes on the residents of Michigan by 13%. The tax increase was intended to raise over 1 Billion dollars – the money would be used for additional “investments”. The Governor promised the new tax would solve the problems of the State and “bring prosperity to all”. The Billion plus dollar tax increase was passed despite the continued warnings that it would further slow the economy and would never generate the promised revenue.

In May 2008 the State announced that additional tax increases will be necessary to prevent a suspension of services. Last years 1 Billion increase is generating $500 million less than expected, creating yet another budget shortfall and the need for additional taxes. The improved economy promised by all these increases is no where in sight.

Michigan’s 2008 budget is $44.8 Billion dollars.  In 2003 the budget was $38 Billion. The State has lost 2,000,000 jobs while increasing taxes by $6 Billion dollars. The people of Michigan are now the 5th most taxed in the nation. 

Michigan government employees have not felt the pinch or belt tightening of the average Michigan resident.   According to the Mackinaw Center for Public Policy the average salary and benefits package of a state employee is $75,000 a year, private sector workers have an average salary and benefit package of $58,000 – this number is still substantially above the national average of $48,200. Rarely will you see such a gap between state employees and those they serve.    

Michigan’s median income continues to drop. Poverty is on the increase. Detroit’s poverty level is 33%, the highest poverty level of any major city in the Country. Flint and Kalamazoo are tried for 5th in the nation (cities with a population between 65K & 250K) with a poverty rate of 35.5%.

There appears to be no end in sight.


Michigan led the Nation into the recession, how can following Michigan’s economic policies lead the nation out?


Michigan has at least two, major, stumbling blocks to recovery.

The first is education. The state ranks 39th out of 50, The state needs better educated workers, better educated to complete for world class jobs. Educated well enough to stop electing officials who continue to tax the state to ruin.

The second stumbling block to reversing this cycle is tax reductions, Michigan must drastically reduce the tax burden it imposes if it wants to attract businesses and the jobs they bring.

Compare what Granholm has done to Michigan with what Democratic Governor Strickland is doing in Ohio.


Michigan’s auto jobs are not moving over seas. The are moving from Michigan to other States where the economic environment made auto production more competitive. The BIG THREE – renamed the Detroit Three – by Nancy Pelosi, the Democratic Speaker of the House – are losing sales volume – even in Michigan. In Michigan Toyota car sales are up 36% while US auto sales are declining. The Toyota’s are being built in the US, just not being built in Michigan.

Barack Obama’s suggested economic change is not new … its a return to the past, to the policies of Jimmy Carter. To see his economic principles in practice just look to the economic success of Michigan. The Country cannot afford to be this successful.

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