auto workers

Federally Sanctioned Propaganda Machine

by Gary Howard on December 11, 2008 · 1 comment

in Bailout Watch, Economy, Intellectual Property, Nanny State, Odds & Ends, Privacy, Regulation, Tech & Telecom

 

Apple's 1984 "Big Brother" commercial.

Apple's 1984 "Big Brother" ad

An article over at Ad Age brings up an angle on the whole auto industry bailout probably not considered much before.  The fact that a yet-to-be-appointed “car czar” will have control over a multibillion dollar advertising budget for the big three.  Under the guise of “oversight,” this would effectively “Create World’s Most Powerful Marketing Exec[utive].”  

The draft rescue plan for Detroit sent to the White House by Congress yesterday calls for the appointment of a “car czar” who will oversee the Big Three automakers’ expenses over $25 million — which, by extension, would include media buys. Based on Advertising Age’s estimates of spending by General Motors Corp., Chrysler and Ford Motor Co., that would give the as-yet-unnamed car czar control over some $7.3 billion in marketing spending in the U.S. alone.

The most disturbing thoughts about this (particularly to those concerned with liberty) are provoked here: 

The car czar would wield a budget more than double those of AT&T, Verizon, Unilever and Johnson & Johnson, which round out the nation’s top five marketing spenders, and give the car czar more clout with media and agencies than such famed names in marketing as Walmart Chief Marketing Officer Stephen Quinn and Anheuser-Busch VP-Marketing Dave Peacock.

…If the bailout goes through, agencies that work for the Big Three will essentially be toiling on a government account, with all the associated red tape and strictures that involves.

So there you have it.  We should all be concerned about this for many reasons.  As mentioned, the large ad budget that comes with a czar-controlled U.S. auto industry will allow a government bureaucrat to wield unbalanced and unchecked influence over not only who gets ad contracts, but what media outlets get ad money. The czar can simply refuse to give business to an advertising agency who works for a foreign competitor of the big three (or a “non-compliant” corporation), or refuse to pay money to show ads on outlets that they deem “unfriendly” to the administration or its mission.   This will be an unequivocal disaster.  We have already seen the lengths to which administrations (and pre-administrations) have gone to influence and/or silence media they do not like.  What kind of power plays do you think are possible when the administration’s appointee controls a major source of media outlets’ ad revenue? Whatever it ends up being, it won’t be pretty.

Bailout for Bloated Union Contracts

by Hans Bader on December 10, 2008 · 8 comments

in Bailout Watch, Economy, Features, Legal, Personal Liberty

The auto bailout being fashioned by liberal lawmakers with Bush’s apparent acquiescence contains no meaningful limits on the bloated union contracts that have helped make American automakers uncompetitive by giving autoworkers compensation that exceeds $70 per hour, meaning that the billions of dollars spent on the bailout will simply be wasted.

The bailout is similar to the failed British auto bailout of the 1970s, which destroyed whatever chance the British auto industry had left to survive by diverting its focus from producing good cars at low cost to providing inflated wages for Big Labor and manufacturing vehicles that pleased government planners but not consumers (akin to liberal lawmakers’ demands that U.S. automakers produce “green” vehicles as part of the bailout).

The bailout fashioned by Congressional leaders also contains a provision that violates the First Amendment, by requiring automakers to drop their lawsuits challenging state fuel-economy laws enacted in the name of preventing global warming (which are probably preempted by federal law). In its 2001 Legal Services Corporation v. Velazquez decision, the Supreme Court ruled that federal funds generally cannot be conditioned on dropping lawsuits, because litigation is protected by the First Amendment’s freedom of petition unless it is meritless. (Even if a lawsuit fails, it is still protected if it fails for complicated or technical reasons, rather than because the plaintiff made false factual claims).