Wednesday, December 17, 2008

I am pleased to report that Michael Bryant listened to me



Michael Bryant is my MPP. I contacted his office last week by phone and by email to make the point that any bailout of Chrysler needs to be treated differently than GM or Ford, by virtue of the fact that Chrysler is owned by private equity (Cerberus)

Chrysler rescue has strings


Dec 17, 2008 04:30 AM
Toronto Star

Rescue cash for Chrysler will have strict terms to prevent the privately-owned automaker from taking advantage of Canadian taxpayers, warns Ontario's economic development minister.

"Chrysler will have to be treated differently," Michael Bryant said yesterday.

He promised the Detroit Three automakers will get the life-saving financial "CPR" they need to prevent the eventual loss of over 500,000 jobs in Ontario predicted in a new study if General Motors, Ford and Chrysler were to go bust.

But there will be strings attached, particularly with Chrysler, which has major assembly operations in Brampton and Windsor.

The company's American parent is controlled by Cerberus Capital Management LP, a New York-based firm that manages $27 billion (U.S.) in assets and has been under fire in Washington for not putting more of its own money into the faltering automaker, which is seeking $1.6 billion (Cdn.) in Canada.

Details are "yet to be determined" but could include special warrants placing restrictions on any profits taken by Chrysler at the expense of taxpayers, Bryant added.

"We are working on the assumption that ... the government is just not going to be providing (money) and kissing goodbye."

But a leading auto industry analyst said it will be "extremely difficult" to put any conditions including job guarantees on financial aid for the reeling auto companies.

"They need to shed jobs, not create them," said Dennis DesRosiers, noting none of the automakers are investing so guarantees for future spending are difficult.

"There could be long-term promises regarding intellectual capital like research and development and some broad guarantees regarding greening," he said, referring to more green friendly vehicles. "But it's impossible to get into specifics."

Cerberus, a giant private equity firm, bought most of Chrysler from Daimler in 2007 but has been trying to unload it for months as losses mount.

Discussions involving Cerberus selling Chrysler to GM in exchange for GMAC Financial Services fizzled recently. Cerberus already owns 51 per cent of GMAC.

Chrysler has indicated it could run out of money to operate plants within weeks. The Detroit Three are seeking $6.8 billion (Cdn.) from the federal and Ontario governments.

The Bush administration yesterday said it was still evaluating options and suggested any deal would require major concessions by all sides. Complicating its task, lawmakers in both parties – having failed in their efforts to push a $14 billion rescue through Congress – were pressing for an array of terms and conditions they said should be part of any alternative plan.

"We are not going to be rushed into it," said presidential press secretary Dana Perino.

While the federal and provincial governments worked on conditions for aid, Prime Minister Stephen Harper met privately with Frank Stronach, chair and founder of auto parts giant Magna International Inc., in Ottawa.

One government official said the meeting was part of pre-federal budget talks. A source close to Stronach would not say if they talked about the auto aid package.

Bryant said the aid package is not just for the auto companies but more to preserve the jobs and livelihoods of tens of thousands "in the public interest" and protecting the economy from a deep recession.

His comments came at the release of a new report disclosing that Ontario would lose 517,000 jobs by 2014 if the Detroit Three go under.

The study by the Ontario Manufacturing Council, an arm's length provincial government panel, warned 582,000 jobs would be lost nationally within five years under that scenario as the impact of lost auto, supplier and dealership jobs rippled throughout the country.

Even if domestic output were cut in half, the province would lose up to 141,000 jobs and the country as a whole 157,400.

Ontario Finance Minister Dwight Duncan acknowledged the bailout – which now hinges on the prospect of U.S. government aid that remains in limbo – will put the province deeper into the red than its forecast $500 million budget shortfall this year.

Federal Industry Minister Tony Clement last week pegged Canadian emergency aid at 20 per cent of the U.S. level, which given the $14 billion congressional assistance package means $3.4 billion from Ottawa and Ontario.

No decisions have been made on how that amount might be split between the two governments.

Ontario NDP Leader Howard Hampton said the governments must get job and product guarantees for Canadian plants before handing out any money – particularly to Chrysler.

"Because the owner of Chrysler really doesn't have a commitment to making cars, they're only committed to making money quickly and getting out the door," he said.

With files from Associated Press

5 comments:

Anna said...

It's nice that you think your MPP listens to you. When you ran in the last election, no one listened to you and they gave Flaherty a landslide victory. Why do you think most people dislike you and would never vote for you? May want to think about it before the next time you post.

Anonymous said...

Anna:

Given that you claim to be an expert on what transpired in the last election between myself and Flaherty, can only mean that you are a resident of Whitby-Oshawa.

That said, I am not surprised that you pointed out that: "It's nice that you think your MPP listens to you."

Obviously that isn't your experience with Christine Elliott, and certainly not Jim Flaherty... Mr and Mrs Landslide?

Brent Fullard

Anna said...

I do not live in the riding and I never claimed to be an expert. It's funny how you always assume things with no evidence to back it up. It must be fun being the smartest guy in the room.

All you have to do is look at election results. They will be there forever. Even your great grandkids can see how poorly you did against a guy you spent countless hours attacking.

I find it funny that your MPP listens to you because I don't think anyone else does.

Anonymous said...

Dear Mr. Fullard (Brent)

I hope you really know and understand that you are a champion advocate
for the rights of the 'average' Canadian citizen. There is not anyone
else, that I can think of, that has challenged the status quo of the
big behemoth of government and corporate oppression. THANK YOU.

And you continue on - so fabulously - in your advocacy. THANK YOU.

And you continue on - so honestly in your advocacy (with a bite that
should be patented). THANK YOU.

The couched and shrouded threats and strategy of the current
government, need to be fervently unveiled by those able and equipped to
speak about same. The government as it sits will further deteriorate
and debase our country - CANADA - its statement of stopping public
financing of political party's is the most damning of intentions in
dissolving our democracy. For harper et.al. to then consider an option
of proroguing parliament and/or calling another election is too
unbelievable and cruel to a sane Canadian human being. In effect, they
are bankrupting, and willing to put the deep screws of bankrupting our
country, into effect. $300 MILLION dollars just 6 election weeks ago
and now the threat of another election???? How far does $600 MILLION
dollars go in destroying further, our economy, trust, and social
institutions such as health care?????? I see this. I know that you
see this. THANK YOU FOR FIGHTING. GOD BLESS YOU.

N W

Fairy said...

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