It was just yesterday I posted on the liberal economic policies coming to a head in Montana. Democrats have historically been big on lavishing heavy regulations and taxes on the mining and steel industries, rendering them ineffective as competitors in the world market place. Dems have also enjoyed unmitigated union support, who also played a more than sufficient role in bankrupting two of the big three US auto manufacturers.
Now, with the unrealistic financial demands on industries, combined with risking the taxpayers’ cash on the future of GM, the Dems find themselves between a “palladium” and a hard place with their economic policies.
They can opt to protect the US taxpayers investment in GM (aka Government Motors) by continuing to refuse to honor a GM contract with Stillwater to purchase their metals for catalytic converters at (oft times) higher than market prices.
Or they can shop on the free market, purchasing their metals cheaper from Russia or South Africa, and let the US PGM’s mining business cascade into the financial hole, and leave thousands of American workers jobless.
Democrat Governor Brian Schweitzer has picked which liberal economic approach he’s on… the side of his Montana miners. It is a vote for subsidies…. none of which would have to exist if the government didn’t create an environment for the lopsided playing field with their legislation.
The Montana citizens themselves get screwed either way. If they lose their mining jobs, the repercussions echo not only thru the Big Sky State, but potentially rumble all the way to NJ and CA where the metals are refined. But even if their jobs are saved, they… along with the nation’s taxpayers… lose because the new government owned GM cannot purchase the metals from foreign nations… not burdened with the US regulations, taxes and union contracts… at a better price.
What was that about chickens and roosting again?
As I pointed out, Gov. Schweitzer was demanding intervention from the O’admin. Schweitzer is looking for a bud in the WH for his miners, and today he’s just been handed a huge gift….Steve Rattner has resigned as the Obama top dog of auto czars, and passed the blow torch to Ron Bloom. And Bloom is fresh off his last gig of 13 years as the assistant to the President of the United Steelworkers union…. coincidently the same union who represents the Stillwater Mining Company’s workers.
… [Ron Bloom was] employed by the Pittsburgh-based United Steelworkers union, which has 1.2 million working and retired members. Bloom has worked as a special assistant to the USW president since 1996 and his duties include helping the union affect corporate business restructuring, investments, bankruptcies and mergers. He is particularly known for working on deals related to recent steel industry bankruptcies. In many of these deals, the USW made considerable concessions in order to help steel companies stay afloat.
Needless to say, the USW will be demanding the ear of one who was formerly their own to step in to the situation, coming to the aid of their mine union workers. This, of course, would reverse what Rattner himself helped construct as he spent his entire five months tenure overseeing both the GM and Chrysler bankruptcy proceedings.
GM emerged from bankruptcy last week after removing tens of billions of dollars in debt. Chrysler emerged earlier from its own bankruptcy proceeding.
Both car companies are undergoing dramatic restructuring plans that will see them drop several brands and lay off tens of thousands of factory workers in states across the country. House and Senate lawmakers will see thousands of constituents lose jobs in the process as the industry tries to regain its footing.
“With GM’s restructuring complete, Steven Rattner, whose leadership and vision were invaluable to the auto task force’s efforts, has decided to transition back to private life and his family in New York City,” Treasury Secretary Timothy Geithner said in a statement on Monday.
Ron Bloom, who has had a leading role on the task force, will take over.
~~~“With day-to-day management of these companies in the hands of the private sector, the American taxpayers have a better chance of recouping their investment in these companies,” Geithner said.
With any intervention from Bloom on behalf of the USW and Stillwater, we can safely say Geithner’s comment about GM being “…in the hands of the private sector” couldn’t be any further from the truth. Plus, this is an administration who has demonstrated they place union interests above secured investors and pensioners.
At this point, there is no way Bloom can turn that doesn’t shaft one party (the taxpayers, including Montana residents), or the other (Montana, and possibly CA and MJ jobs… as well as damaging the American PGM industry). Small wonder Rattner is beating feet…
Keep your popcorn handy.
Vietnam era Navy wife, indy/conservative, and an official California escapee now residing as a red speck in the sea of Oregon blue.
I went to a GM dealer where a friend is the floor manager. he says traffic is down 95% as the public has just walked away.
Can you imagine the depreciation you sign on for by buying GM? Or Chrysler?
Does anyone actually think that any of us who are fighting Obama and his take-over of the US are going to be allowed to receive health care when he socializes it?
You support Obama, you get the spoils, you do not support him, you lose.
SJR
The Pink Flamingo
It’s not like they are replacing an apolitical appointment with a political appointment.
Ratner was/is an expert in financial restructuring, not in automotive administration or union negotiations. In order for Chrysler/GM to be competitive, they are going to need continuing union concessions. Bloom is well qualified for this latter task.
Catalytic converters will become less important to emissions controls as the auto industry transforms, over time. In the meantime, we do have a recession, from which to emerge.
– Larry Weisenthal/Huntington Beach, CA
Larry, I’m not making a comment on Rattner – bolting the starting gate when the race horse gates catch fire – as the prime subject. Actually he’s more an easy target of inside corruption since he knows he’s leaving a quagmire and heading home in supposed accolades – dodging the repercussions.
But my comment is in response to your “replacing an a’apolitical appoinment with a political appointment” comment. And BTW, Obama’s czars are anything *but* a’political.
Like Rattner, Bloom is also an “expert in financial restructuring”. Bloom’s expertise happens to fall on the union side of the equation – and specifically the metals/mining unions. Good thing for the Montana minders and USW. Piss poor option for the US taxpayer, on the hook for government motors majority ownership. Would you, as a majority share owner, vote to spend more for necessary inventory to subsidize?
But you obviously did not read only my previous post for the uses for the PGM metals… which also feed the electronics/computer industry, hydrogen cells etal. Their ability to survive to serve that secondary market, in addition to catalytic converters… plus the jobs mining and refining… may well depend on the new czar undoing the old czar’s work… which was undoing the legislative damage making subsidies necessary for the American PGM industry to survive.
Delicious in it’s insanity. Sad in it’s repercussions on ordinary Americans that Obama professes to revere.
Why am I explaining this to someone who should be intelligent enough to figure this out on his own???
Mata, I don’t know why you waste your time with him. His credibility is only slightly higher than that of CRAP, fit, or richard.
He has been wrong time after time about obama and doesn’t even have the guts to answer a simple question because he knows he is wrong.
Larry is willingly mainlining the Kool-Aid and will defend obama no mater what. His straw man response to your post proves that. Even what he considers a tangenital attack draws a defense of obama’s actions.
Oh and larry, answer the question. I won’t stop asking.
Is obama governing from the center and were his picks centrist?
@Hard Right: You don’t really expect poor Larry to answer that question do you?
He’s sipped so much of the Hopey Changey Kool Aid that he would have a meltdown if he ever had to admit all the lies he’s swallowed from Obie.
and let the US PGM’s mining business cascade into the financial hole, and leave thousands of American workers jobless.
—
That’s the Statist/Dems for you! They want everyone on welfare so you HAVE to side with them. Their policies are not accidental.
Well Mike, it sure doesn’t make him look good when he is obviously avoiding it. I have definitely lost what respect I did have for him. He’s just another garden variety liberal suffering from pathological denial of reality.
@Hard Right:
His [Larry W’s] credibility is only slightly higher than that of …, fit or ….”
I disagree. Fit actually has a sense of humor, sometimes very funny.
Larry’s only talent, as I’ve observed before, is that he writes well. Yet, despite that “talent” he’s still unable to conceal the fact that he has absolutely nothing to say, which I guess means he really doesn’t write that well after all. And, Larry has no sense of humor that we are aware of.
Also, Fit has the admirable quality of brevity. At least he doesn’t force you to wade through an interminable cesspool to determine the “value” of his comments. I appreciate that consideration.
Oh, and yes, I too am puzzled by Matta’s seeming obsession to rebut the dullards. Maybe she’s just bored and is using their drivel as a backdrop to her sanity? Works for me.
UNION MOTTO
“Prosperity for me, but not for thee.”
@Hard Right:
A little hint for Larry….
“John Holdren, Obama’s Science Czar, says: Forced abortions and mass sterilization needed to save the planet”
http://zombietime.com/john_holdren/
“Sorry, what’s the question again” — Larry W.
@yonason:
I appreciate the time Mata takes to “rebut the dullards.” It isn’t just FA regulars that are reading these threads, newbies, lurkers, etc., she’s right to not let some of the comments stand. After lurking for quite some time, I finally got the courage to become a newbie, Chris G was so gracious in his response to my first post, never will forget that or the kind words by our other hosts. This has been a great spot to land.
I also *very much* appreciate your informative posts, attitude and sense of humor. There are so many great minds contributing to this blog. My future doesn’t looks so dim when I know you guys will always be here when I’m stuck in my house.
@Missy:
I agree, Missy, with your assessment of FA, which is probably why I spend more time here than anywhere else. I like the crew, and most of the posters, even a number of them who I might not seem to from my comments.
Also, thanks for your compliment. You can’t see, but I’m blushing. In fact, I feel I have to appologize for those times when I’m not up to speed, and a bit too overbearing. And that’s another reason I like the folks here. They are pretty level headed, which helps me keep my focus, as well.
Glad you are a member, too.
So some 50 years ago the folks in the Extension Department of Harding College got it, and Predicts the Future 50 Years Ago This is Amazing Insight in a cartoon.
Unfortunately the writer has some facts desperately wrong. The palladium market, like platinum, gold and silver is a world market-The price is the same globally. Of course it would cost to ship palladium from off shore. Keep in mind Norilsk ( The Russian mining consortium) has a major ownership in Stillwater. Stillwater has been hurt by a double whammy- Cheap palladium (in the $200-$250 range) and plummeting demand. Despite great efforts to promote thnis platinum family metal for 950palladium jewelry, demand is slack.
Thank you for your contribution, Daniel. I do agree that the demand for platinum and palladium has been down globally for all aspects of it’s useage – i.e. dental alloys, jewelry, and catalytic converters just to name some – due to the declining demand and the world’s economic status. All this was in the Platinum 2009 Market Review.
It was noted that it was the first time that the auto industry demand declined since 1999.
Also in that same review, they noted that the supply in the South African mines were declining simultaneously due to interruptions to electricity supply, bad weather, safety closures, smelter shutdowns and shortages of skilled staff. Due to base supply/demand economics, less supply will affect pricing…. and the demand for PGMs for various uses has not dried up.
They also noted that palladium demand was on the increase, but the supply declining… despite economic problems…. still drove the price up.
And you will note in my first post on Stillwater and the GM contract, I addressed facts that Stillwater was owned by Russia’s Norilsk.
None of this changes the reality that, in a declining demand, the GM contract becomes even more important for the American PGM industry. Nor does Norilsk’s majority ownership… which they’ve been trying to sell since last October (in the first linked post)… negate the reality that the miners and refining facilities all employ US workers.
INRE the demand for platimum/palladium, the palladium demand is projected to rise in China, Europe and America for jewelry.
Additionally, MarketWatch wrote that platinum has gained 60% from it’s lows last October, coincidently about the same time Norilsk announced it’s desire to sell. And both platinum and palladium prices are on the rise.
Finally, the North American Palladium group believes that the increased fuel regulations play a significant role in the future demand of palladium. I can’t argue this one.
All this still translates to the reality that the US mines need workers to harvest the rare resource (since it’s only one of three nations that produce the PGMs). And the GM contract – with a private party agreement for subsidizing – being cancelled affects the stability of that operation.
So I have to wonder, are you suggesting that the J-R Reef resources are expendable as a world market?
I forgot to add, Daniel… I know the main thrust of your interest in the PGMs is jewelry, via your blog. But unless there is an alternative to use of either platinum or palladium in hydrogen cells, increased development of this technology also lends to increasing demand.
Why do you think he quit?
How much was he paid?
and these car companys have now over 100 billion in Taxpayer money.
kcanova
your cartoon is great.
http://www.foxnews.com/politics/2009/07/14/auto-czar-leaves-washington-cloud-pay-play-investigation/
Auto Czar Leaves Washington Amidst Pay-to-Play Probe Involving Former Firm
The White House stood by Steven Rattner back in April when reports surfaced that he was tied to a deal being investigated by the Securities and Exchange Commission and New York Attorney General Andrew Cuomo. But his departure as auto czar is raising questions about the course of the investigation.
July 14, 2009
snip
The peculiar timing of Steven Rattner’s departure as White House car czar has raised questions about the course of an investigation that has scrutinized his possible dealings with the New York state pension fund.
snip
Though the task force couldn’t prevent GM and Chrysler — which have received about $80 billion in taxpayer cash
[yet they shut over 700 car dealers who did not support democrats]
today they are talking again about pushing the health rip off through on the back pages they plan to fine people who refuse to buy health insurance they think they will raise 34 billion in these fines?
Don’t give up the fight never give in or up.
Catherine
Catherine, I did have some side bar info INRE the incestuous relationship between Rattner, Chrysler’s Cerebius and Quadrangle back in my Mar 31st post on the fate of the auto manufacturers. This added stuff was courtesy of a comment originally by Missy.
I did not, and will not pursue Rattner’s investigative status for a single, and very prime reason… consistency. I do not sanction those spreading rumours and speculation about Palin and fantasy/manufactured FBI investigations, and I will hold that consistency for Rattner as well. If he comes under investigation, I will wade into those waters (and latest reports from Mayor Bloomberg say it’s not likely he’ll be investigated, but doesn’t eliminate possible civil suits).
So Rattner has not been named as as subject yet, and apparently is not returning to Quadrangle post O’admin duties. Apparently, Stillwater’s status is not the only fallout he is avoiding.
His official reasons are what they are. But if I were to bank on a more sure bet as to the reason for his beating feet, and leaving it in the hands of a former USW employee, I’d say GM-Stillwater and the stink this can and will raise (once the media learns to multitask…) is sufficient enough. He doesn’t have to publicly undo what he wrought in the restructuring back rooms, and the pressure of dealing with the mining job loss falls on his successor.
Missy, you are absolutely correct about Mata and larry. As we have learned, letting disinformation stand can be damaging. I do forget that somethimes. Thank you for the reminder.
One more for jeweler Daniel INRE the PGMs. And this is from the transcript of Stillwater Mining Company’s 4th quarter earnings for 2008, by Frank McAllister, Chairman and CEO of Stillwater Mining.
It is obvious that a great portion of Stillwater’s business is bolstered by the GM contracts.