Like MENSA, Only Thicker

Is the dENSA Universe Expanding or Contracting?


Additional Evidence:



Advancing the theory of off-set credits, and similar incentives expected under the, ‘City of Spokane Sustainability Plan.’

Alternately, more of, ” it’s the right thing to do!”



dENSA Returns to the Red Lion Tavern on May 6th….mmm…. BBQ,  Wine Broiled Chicken!!







dENSA Question of the Week:

What Rap would dENSA most like to see the Spokane City Mayor and  Council President perform?


Auto Industry Bail-out or Bankruptcy?

Holmen Jenkins  offered  a pragmatic view of this matter  in the Wednesday, April 29th issue of the Wall Street Journal:






* The Truth About Cars and Trucks, by Holman W. Jenkins, Jr.




Call it a bailout or restructuring.  What you’re seeing is not a new beginning for the homegrown auto sector. It’s the culmination of a decades-old, dishonestly peddled auto policy.

[Business World] M.E. Cohen

The two parties that turned the Big Three into a perennially limping freak of unwritten industrial policy now will take formal ownership of their handiwork. The United Auto Workers (UAW) would own 39% of GM. The federal government would own 50%. The creditors will be shafted with just 10%. (In the Chrysler plan being discussed, labor would own 55%, making it effectively a subsidiary of the UAW.)

The day after any such settlement is finalized, the clock will start ticking down to the next collective-bargaining session between a monopoly UAW and what remains of the Big Three — though now the UAW would be sitting on both sides of the table.

Nearly 25 years ago, a Los Angeles Times reporter innocently and accurately invoked the “M” word in describing the domestic auto sector, noting that the arrival of Japanese auto plants was “threatening the UAW’s traditional monopoly on labor in the domestic auto industry.”

The erosion of the Big Three’s market share since then has really been the erosion of the market for monopoly labor-produced cars. The UAW standard tactic, “pattern bargaining,” which it pursues without embarrassment, would have gotten Bill Gates thrown in jail under the antitrust laws.

When the L.A. Times wrote, the labor cost differential versus a Japanese plant was about $2,000 per car. Twenty years later, the cost difference was about $2,000 per car. Today’s lament is, “The bankers have benefited from a bailout, so why shouldn’t auto workers?” But they have, they have — for decades. For the business model described above could not possibly have survived otherwise.

Chrysler was bailed out directly with government loan guarantees; the Big Three all benefited from Reagan era “voluntary” quotas on Japanese imports to prop up domestic car prices. But these were temporary fixes. For more than 40 years, a 25% tariff has kept out foreign-built pickup trucks even as a studied loophole was created in fuel-economy regulations to let the Big Three develop a lucrative, protected niche in the “passenger truck” business.

This became the long-running unwritten deal. This was Washington’s real auto policy.

For three decades, the Big Three were able to survive precisely because they skimped on quality and features in the money-losing sedans they were required under Congress’s fuel economy rules to build in high-cost UAW factories. In return, Washington compensated them with the hothouse, politically protected opportunity to profit from pickups and SUVs.

Doesn’t sound much like what you hear incessantly from your Congressman, about how Detroit’s problems are all due to management “incompetence” in deciding to build “gas guzzling” SUVs, does it?

But then uncertain at this point is whether any legislator (other than John Dingell) remembers or grasps anymore Congress’s own role. Yet the muddled, covert bailout continues: Washington’s latest fuel-economy rules actually reward manufacturers for increasing the size and weight of some vehicles. The truck tariff remains in place. The fuel-mileage rules continue to protect the UAW monopoly by discouraging the Big Three from shipping small-car production offshore.

Lately some have doted, with wonderment and admiration, on the Obama administration’s apparent willingness to drive a hard bargain with the UAW as it tries to impose a stage-managed replica of bankruptcy on GM and Chrysler. Please.

In a real bankruptcy, which is the natural fate of companies unable to meet their obligations, Chrysler and GM would be run (or liquidated) for the benefit of their creditors, not their workers. But, here, “pattern bargaining” will remain the law of the Detroit jungle. The UAW will continue to use its unnaturally augmented clout to extract uncompetitive pay and benefits (it can do no other given its internal incentives). As it has for 40 years, Washington will pitch in with one improvisation after another, disguised as energy policy, trade policy, health-care policy or environmental policy, to stop the rivets from popping off. Politics, especially Democratic electoral politics, will play a more dominant role than ever.

Look closely and the hidden subsidies to keep the dismal beast alive have already started flowing — tax credits for UAW retirees to make up for reduced health-care benefits, loans to help Detroit “invest in green cars.” And plenty more will be needed to sustain Obama Motors on life support, at least through the 2012 election.

The Obama strategy does nothing to change the basic dynamics of the homegrown auto sector — a labor monopoly combined with endless finagles in Washington to help the Big Three survive competition from Japanese, German and Korean auto makers. But maybe the shock of seeing GM nationalized will at least cause some in politics and the press finally to think about how we got here.



Spokane Events




2009 Bloomsday: Pick up numbers at the Spokane Convention Center starting Friday, May 1st.  Race on Sunday, May 3rd.


Free metal detecting  and Treasure Hunt at Liberty  Park, May 16th.   Details at:  http://www.sharingtreasure.com/

Health Care Forum: 7:00 p.m. S.C.C. Lair on May 27th

4th of July Tea Party. Details at:  http://northwestteaparty.org/

Apply for 2010 Spokane NCAA Basketball Tournament Tickets now @ http://www.spokanearena.com/

Spokane Shock Season is on. Next home games  May 2nd and 9th. http://www.spokanearena.co

20th Anniversary of the Spokane Hoop-fest June 27th and 28th

Guaranteed Registration ends on May 4th.


Mariners: http://seattle.mariners.mlb.com/index.jsp?c_id=sea


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