Getting Nailed v Getting Screwed

Observations on how the courts, at least in the case of one of the biggest bankruptcy actions to ever grace the docket, can mean less about fairness and justice and more about power and where one stands in line.

It is worth noting that auto dealers, on the whole, don't really get a lot of love from us. Granted, car salesmen do rank higher on the public confidence scale than Congress but that's not much. The events of the past couple months may be changing that vision.

Enter the bankruptcy of Chrysler, and soon to come General Motors. Spurred on by the rotten economy, management decisions to keep cranking out inventory even though buying ground to a halt, union contracts once the builder of the middle class and now decried as the last straw to topple American auto power -- the perfect storm leaves entire classes of people who put their money where their mouths were on the sidelines, holding the bag.

The State of Indiana is fighting back, noting the public pension funds that backed Chrysler shouldn't be shoved to the back of the bankruptcy bus behind the nation's taxpayers and the union who stand to benefit if Chrysler-Fiat figures it out. They argue they shouldn't have to settle for pennies, or nothing, on their investment. One can also argue the decision to pour millions into Chrysler stock on behalf of the Hoosier State's public workers wasn't made under duress, and the owners of the company (shareholders) knew the risk of ownership. With reward comes risk, and the profit potential has an alternative - flat broke. That would be called getting nailed. Their choices, their harvest.

Except the government, which says the billions and billions we pour into keeping Big Auto alive will be repaid to taxpayers. Someday.

In the meantime, the way a bankruptcy should work -- secured creditors in line first, all others behind -- displays a real flaw in our system.

Which brings me back to car dealers, and the getting screwed.

Only when we seriously think about life without the neighborhood car dealer do we get a real sense of how the impact comes home. And for the dealers now shoved aside, those who put heart and soul into shilling for Chrysler and GM, they have less than a week to unload inventory they won't even be allowed to sell after next Tuesday.

Putting this in perspective: you buy that hula dancer lamp at a yard sale you visited last October; you plan to unload it this summer, and yes you know you may not sell it for what you paid for it but what the hell, it at least made you laugh while gathering dust in the basement. But along comes a judge who says hold off -- you have to sell it today even though you bought it on your time, fair and square, with the understanding you could sell it when you wanted to. Or could sell it.

The double whammy for dealers losing their franchises isn't just losing the line; sales representatives have lost primary clients for years, and understand with every peak comes a valley. But these are local business people, our neighbors, people who support the Little League teams and the bowling teams and the local charities and high school sports. Along with scrambling to figure out how they're going to make a living, they can't even sell what they already own.

Unless a bankruptcy judge comes to his senses and sees that there is a bigger picture involved in this quickie divorce between an American car company and the partners who made the mistake of taking Detroit at their word.

For these local dealers to have 30 days to unload inventory they took on good faith, often as a sign of support for a company now driving the cruelest of paybacks, isn't just unfair it is un-American. These dealers took the cars with the intention of selling them. If a hardware store took possession of a truck-full of shovels wouldn't you consider it theirs to sell, even if the shovel company went belly up? At the core, how is a car any different? Inventory is inventory.

Let our good neighbors sell the goods they were sold, without penalty, just as any used-car dealer would have the same option of doing. Or tell Uncle Sam's new auto overseers to take those cars back, and roll that inventory into the already bloated pool of autos waiting for savvy consumers to see the benefit of what a fire sale really looks like.

Common wisdom is seeing how the powerful treat the meek for a true picture of character. Now is the time for those still holding the reigns of power when it comes to cars to display some character.

Back In The Swing Of Things

I go out of town and look what happens; the people who hate the mayor complain the rules of engagement have changed when he starts firing back; students and non-students at Kent State try to burn the street down (gee, that's so 70s...); Chrysler takes the road to bankruptcy...oh, and more people get the boot from a certain big radio empire.

Any surprises in the above?

The story making the rounds today is death threats supposedly flooding city hall by some who signed recall petitions, now upset the mayor's supporters are tracking them down and trying to get them to change their minds. The good-natured clerk who took the calls didn't exactly describe a flood, more like a trickle (definition: under five) calls she got from city hall critics who didn't exactly cotton to having their opposition tracked down to this point. That's what I call hardball politics, hardly a surprise from supporters of the mayor who don't like the recall. I wouldn't call it dirty politics, however; those signatures on those petitions are public documents.

You wanna dance with the big boys? Don't be surprised when they step on your toes.

On the KSU riots: as I write this the esteemed president of Kent State and Kent's city manager are holding a news conference to discuss their plans for keeping the peace this weekend. Would've been nice to have seen Dr. Lefton take a more up-front approach after students and non-students alike turned Saturday night into an episode of Burn This last weekend, but I guess mere mortals should be happy we get at least this much.

My favorite coming out of this: Commerce, as expressed by a KSU student who knows a good thing when he sees it. At left is just one side of the t-shirt he's selling via Facebook as well as here on eBay for a mere $15.00 to help remember when beer-fueled riots at Kent had nothing to do with Laos or Cambodia. Many thanks to former RCRG news anchor/reporter Shelley for the tip -- and I'm very proud the entrepreneurial spirit is alive and well in Golden Flash Nation.

Here's hoping the proceeds go to the bar bill. Or a PR course for the big bosses at the University.
On Chrysler: this whole thing makes me sad. The Twinsburg stamping plant is just four miles from my house and represents 600 jobs in Summit County and a huge chunk of that city's annual budget. Aside from the normal greed of losing tax money, it should be noted Chrysler has been a damn fine partner for plenty of local initiatives in northern Summit County, as most auto manufacturing operations are in their respective communities. There are an awful lot of people who went to college and took a non-auto career path because their mothers and fathers worked at auto plants in this country, and there's probably no greater engine for the power of America (other than a World War -- let's be honest) than the domestic automotive industry.

I don't know the answer other than more of us buying more of the cars they make, but all the pro-buy America rhetoric aside it's our buying decisions, joined with big business and big union short-sighted manufacturing decisions, that led us down that path. It won't be fixed by marketing.

Which brings me to my friends up and down the road in the radio industry. Much has been reported the past few months as big broadcast companies slice jobs and try to convince audiences it'll make the product they rely on stronger. This is the ultimate insult to any listener with a brain, and I still think all of our listeners have lots more brain power than the marketing gurus give them credit for.

We know when you take local people off the air it means we aren't getting anything remotely resembling something relevant anymore. It doesn't take an MBA with a side order of marketing to understand we're getting a raw deal from someone doing news, or talking about community events, or even delivering a weather forecast from a thousand miles away and two days ago.

We struggle with the same issues in our own business model here in Akron, and I'll be the first to admit we don't always get it right. But the argument over what to do should start with "what's in this for the customer?"

If we are truly serious about establishing credibility with our listeners then shouldn't we be prepared to correctly pronounce the cities they live in, and give them information they need to protect themselves, their families, and their property when storms/natural disaster/man-made tragedy threaten? These questions matter, and not when the smaller spokes outside the hub have to deal with an emergency. We used to have managers in the broadcast business who seemed to understand public service should be more than just a box to check off on a government filing, not the current crop of "metrics analysts" who pass for news ownership.

Has it really been that long ago when radio learned this painful lesson after a quartet of kidnapped aircraft froze the nation?