There’s a dead cat on the line. I was first acquainted with this old adage in the early 90’s while living in Augusta, Georgia. Apparently it is an old expression referring to the likelihood that something, somewhere is wrong. Very wrong. I thought about this expression after Chrysler (soon followed by General Motors) announced they would be closing down many of their dealerships. Since these are “franchise” operations that do not represent significant, if any, expenses for the company, but instead represent streams of revenue, it seemed mighty strange that they would have a desire to close any of them. To the contrary, they should be encouraging as many of these businesses as possible to stay open since they represent the public face of the company during this economic downturn that has created such a malaise for the auto industry. Instead of putting the best face they can to the public, they have curiously chosen to do exactly the opposite and essentially lower their public profile. There certainly seems to be a dead cat on the line…and there is.
There are just too many things that don’t make sense. It isn’t just the unjustifiable business decision to cut operations that don’t affect the costs of the company’s business. It is also the process of selecting the dealerships to be closed. It is particularly suspicious that many of the dealerships selected for elimination are among the most successful operations within the Chrysler network. Many of them have been Chrysler and Dodge dealers for decades. What possible justification could they have for closing down successful dealerships that represent the very lifeblood of their company’s existence? Not only are they choosing to reduce the flow of cash into their company, they are doing so in the midst of a recession that has been particularly disastrous to the auto industry. Is somebody missing a cat?
Some of the dealerships that got the axe are telling stories that raise considerable doubt that there were ever any economic reasons for this process and that there was, instead, a political motivation. One dealership slated for closing in Alvin, Texas, increased its new car sales 50% in the first four months of 2009! How can you rationalize closing a dealer who is increasing sales while in the throes of the worst recession since the 1970’s? As it turns out, this story is not unique. Successful and highly profitable dealerships have all too often been the ones selected for elimination. Smell a dead cat?
As you dig into this you find that there is evidence to suggest that dealers selected for elimination tended to be ones who are affiliated with, or donated money to, the Republican party and its candidates. Coincidence? When the the list of 789 closing franchises is compared to the list of political donors making contributions in the November 2008 election, less than 10 percent gave to Democrats while 90 percent gave substantial sums to Republican candidates. The franchise owners selected for dealership elimination contributed over $450,000 to Republican presidential candidates and the GOP, while $7,970 was donated to Hillary Clinton’s campaign and $2,200 was given to John Edwards’ campaign. By comparison, Barack Obama received a mere $450 in donations! Dead cat found.
Some of the dealers on the hit list jump right out at you:
“Vern Buchanan is a Republican Congressman from the Tampa Bay area. Robert Archer is the son of former Republican Congressman Bill Archer. John Culberson, a libertarian-leaning Conservative, is now the Congressman for that West Houston District. He was heavily supported in his election efforts by the Archers Family. Additionally, James Crowley, owner of a Chrysler Dealership in Escondido, California is on the list to be closed. Crowley is a big backer of libertarian-leaning Republican Cong. John Campbell of Orange County.”
The list is heavy with influential Republicans and libertarians. Another name on the list is Ray Huffines, who owns a large dealership in the Metro-Dallas/Ft. Worth area. The Huffines family have been major contributors to Rep. Ron Paul (R-TX) over the years…– American Thinker
Republican candidates – and Other GOP contributors include Michael Maroone, a dealer in Ft. Lauderdale, Fla. He gave $20,000 to the Florida Republican Party, $12,700 to the Republican National Committee and $2,300 to presidential candidate Mitt Romney. Likewise, Menomonee Falls, Wis., dealer Russ Darrow and his family gave $19,000 to the Republican National Committee, $6,029 to the Wisconsin Republican Party, $2,300 to John McCain and $1,000 to Rudy Giuliani. Bedford, Texas, dealer Eric Grubbs gifted $11,500 to Mike Huckabee, $4,600 to Rudy Giuliani, $6,500 to Texas Republican Congressional Committee, $1,085 to the RNC and $500 to National Republican Congressional Committee. Midlothian, Va., dealer Max Pearson donated $18,000 to National Republican Senatorial Committee, $6,900 to the RNC, $6,900 to John McCain, $3,600 to Virginia Republican Party and $1,000 to National Republican Congressional Committee.
The list continues with more than 60 political donors who are scheduled to lose their franchises – many of whom gave thousands of dollars to only seven dealers who contributed a total of less than $12,000 to the Democratic Party and its candidates. -World Net Daily
Another blogger, Doug Ross, also reviewed patterns on the closure list and noticed the trend.
“I took all dealer owners whose names appeared more than once on the list,” he wrote. “And, of those who contributed to political campaigns, every single one had donated almost exclusively to GOP candidates.”
Jim Anderer, another of the disposed dealers, told Fox News’ Neil Cavuto that he doesn’t understand why Chrysler is shutting down his Long Island dealership because, he claims, it is quite profitable with sales volume ranking in the top 2 percent of the company.
“They won’t tell us. They seem to be running for cover right now because they won’t give us a solid explanation. They come up with all these reasons, but none of them seem to make sense. This is insanity. The government is stealing my business. And they’re telling me there’s nothing I can do about it.”
Anderer also said Chrysler told him they want to combine their stores and that dealers cost the manufacturer money to stay in business.
“In the dealers that they cut, there seems to be no cohesive way that they did it. There was no process that you could put your finger on and say, ‘Hey, we cut 25 percent of the lowest performing dealers.’ They didn’t do that. Nobody will give us a real clear explanation of the formula that they came up with.”
George C. Joseph, a Dodge dealer for over 35 years who employs over 50 people in his Melbourne, Florida franchise claims his operation is financially profitable, yet he too was selected for closing. Likewise he is not happy about it:
“On Thursday, May 14, 2009 I was notified that my Dodge franchise, that we purchased, will be taken away from my family on June 9, 2009 without compensation and given to another dealer at no cost to them. My new vehicle inventory consists of 125 vehicles with a financed balance of 3 million dollars. This inventory becomes impossible to sell with no factory incentives beyond June 9, 2009.”
He later went on to say that without his franchise, his facility can no longer perform any service warranty work. This even includes vehicles sold by his establishment while still a licensed franchise operator! This he says has the effect of rendering his $300,000 parts inventory worthless. Also, Chrysler is not required to buy back tools, parts or…vehicles from from the dealers it has terminated under these negotiated bankruptcy rules. The Obama administration, without any constitutional authority, has intervened and negotiated these terms in typical Chicago gangland fashion. The dealers have been made an offer they can’t refuse.
“This is a private business, not a government entity. This is beyond imagination! My business is being stolen from me through no fault of our own. We did nothing wrong.” – George C. Joseph
Chrysler was forced into bankruptcy by the Obama administration who took it upon themselves, with no legal authority, to manage the distribution of assets. He forced a deal that bypassed the bondholders, who actually invested money in the company, and gave a preferential deal to the United Auto Workers that made them the majority owners of the company. This, in and of itself, was nothing less than a political payoff to a union that generously supported him in the election. The decision making process that is closing down these dealerships appears to be a blatant political hit against the president’s enemies. No democrat ever need raise the spectre of Richard Nixon and his enemies list ever again!
“It became clear to us that Chrysler does not see the wisdom of terminating 25 percent of its dealers. It really wasn’t Chrysler’s decision. They are under enormous pressure from the President’s automotive task force.” – Leonard Bellavia, of Bellavia Gentile & Associates,
who represents some of the terminated dealers
According to one of the discarded dealers Chrysler is already shopping for dealers to open franchises left by the eliminated dealers. Now why would you do that? This is just a political massacre designed to clear the landscape of political “undesirables” and replace them with dealers that meet with this administration’s approval. We have seen this particular brand of socialism before in 1930’s Germany. All of these actions are being done out in the open and all of them are totally illegal. Where is the media? Now we are starting to hear stories about how THEY are scared to offend this administration for fear of reprisals against them. Divine Justice, perhaps, but it does not bode well for our future.
“So we are acting as reluctant shareholders, because that is the only way to help GM succeed. What we are not doing, what I have no interest in doing, is running GM.” -President Barack Obama
Hot on the heels of the great Chrysler swindle, our president has yet again authored a bankruptcy to his own political advantage. Unlike the Chrysler deal, this time he has chosen to give the United States government 60% ownership of the restructured GM. And why not? GM is a considerably more valuable asset than Chrysler so why not keep that one for himself. Like the Chrysler deal, the secured bondholders were illegally placed behind the government and the UAW in the division of assets and ownership. Of course GM has been ordered to close hundreds of dealerships as well. Does anyone believe the GM closings are any less politically motivated than the Chrysler ones? He claims he does not want to run GM even as he is doing exactly that. He’s getting away with it too! What are we going to do about it?
This is a totally illegal nationalization of a private industry. However it sits well next to his ever growing collection of banks and insurance companies and is soon to be joined by the health care system and, perhaps, California. Is it any wonder such luminaries of leftist evangelical socialism are turning green with envy? Venezuela’s President Hugo Chavez said on Tuesday that he and Cuban ally Fidel Castro may soon find themselves to be more conservative than President Obama!
“Hey, Obama has just nationalized nothing more and nothing less than General Motors. Comrade Obama! Fidel, careful or we are going to end up to his right.” – Hugo Chavez
There’s a dead cat on the line alright…