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Asian Invasion on the Capitol


Mr.Krinkle

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Who has the juice?

“They outspend us,” Mr. Lutz said, “and I will tell you today — mind you, today — it is my considered opinion that Toyota has more clout in Washington than we do.”

He went on: “One of the sad things is, Toyota is so profitable and has plants in so many states that, frankly, they’ve got more congressmen and senators than General Motors does.”

“We don’t really keep score,” said a Toyota spokeswoman, Martha Voss. “Our goal is to become No. 1 with the customer, not in Washington.”

But David E. Cole, chairman of the Center for Automotive Research, said Toyota clearly had won some influence through the $18 billion it had invested in its American factories in the last 20 years.

“When you’re talking about adding new plants,” Mr. Cole said, “you get significant clout, with the possibility that if I’m nice to you, you’ll give me a plant.”

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tax breaks to open a plant and not having to have them be union. its a great gig if you can swing it.

you gotta love the soundbites Lutz throws out there at autoshow time. its great stuff. he really likes to stir the pot.

lots of Americans are probably fine with foreign interests controlling our politicians. as long as they can keep 90% of the population living day to day and getting by.

Edited by regfootball
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tax breaks to open a plant and not having to have them be union. its a great gig if you can swing it.

you gotta love the soundbites Lutz throws out there at autoshow time. its great stuff. he really likes to stir the pot.

lots of Americans are probably fine with foreign interests controlling our politicians. as long as they can keep 90% of the population living day to day and getting by.

Whatever Lutz has to do to get GM mindshare if fine with me. In real life you do what you have to do get the business. GM employees need to understand this too some day.

Those same "lots of Americans" are the ones that buy anything anywhere without understanding the long term ramifications of their decisions. Of course the other side of it is when they just don't care at all as long as it doesn't impact them immediately or directly or betters them personally at the detriment of the rest of the country? How else do you explain a guy like Robert Bird getting elected over and over when he is clearly another Washington crook?

The problem with US politics is it has gone from the "vote" controlling the politicians to "money" controlling them, which means we've lost the democracy. Personally I think we should completely disallow political ads on television. The "right-to-free-speechers" can be damned. These ads have far too much influence on who uninformed people vote for and relatedly put too much value on fundraising. I'm sure the big fundraisers get behind the "free-speechers" and support them when it's convenient to do so. We should make people work at studying the candidates themselves or just don't vote. It's ludicrous that people vote for candidates based on what bull$h! they see on TV.

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Whatever Lutz has to do to get GM mindshare if fine with me. In real life you do what you have to do get the business. GM employees need to understand this too some day.

Those same "lots of Americans" are the ones that buy anything anywhere without understanding the long term ramifications of their decisions. Of course the other side of it is when they just don't care at all as long as it doesn't impact them immediately or directly or betters them personally at the detriment of the rest of the country? How else do you explain a guy like Robert Bird getting elected over and over when he is clearly another Washington crook?

The problem with US politics is it has gone from the "vote" controlling the politicians to "money" controlling them, which means we've lost the democracy. Personally I think we should completely disallow political ads on television. The "right-to-free-speechers" can be damned. These ads have far too much influence on who uninformed people vote for and relatedly put too much value on fundraising. I'm sure the big fundraisers get behind the "free-speechers" and support them when it's convenient to do so. We should make people work at studying the candidates themselves or just don't vote. It's ludicrous that people vote for candidates based on what bull$h! they see on TV.

YUP. if you can control the media, to some degree you can control the vote.

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The problem with American policies is that we have this pie-in-the-sky idea of "Free Trade" with countries that A) do not in any way really reciprocate, B) keep their currency artificially low so their goods can be sold at lower prices and C) are given tax breaks to be able to build non-union plants in the states.

There's nothing that can be done about "C" now- that door has been opened too far. However, "A" and "B" should be taken care of by Washington. Sadly, I doubt it will happen, no matter what party is in charge.

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The problem with American policies is that we have this pie-in-the-sky idea of "Free Trade" with countries that A) do not in any way really reciprocate, B) keep their currency artificially low so their goods can be sold at lower prices and C) are given tax breaks to be able to build non-union plants in the states.

There's nothing that can be done about "C" now- that door has been opened too far. However, "A" and "B" should be taken care of by Washington. Sadly, I doubt it will happen, no matter what party is in charge.

As long as Toyota's got money to burn, and as long as politicians continue to accept -- hmm, what PC term are they using now to mask "bribes"? -- from such companies as Toyota, then this slide will continue.

Additionally,

- It looks good for Toyota because they are creating more jobs in the country.

- It looks good for the politicians because they are facilitating Toyota's creation of jobs in the country.

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The problem with American policies is that we have this pie-in-the-sky idea of "Free Trade" with countries that A) do not in any way really reciprocate, B) keep their currency artificially low so their goods can be sold at lower prices and C) are given tax breaks to be able to build non-union plants in the states.

There's nothing that can be done about "C" now- that door has been opened too far. However, "A" and "B" should be taken care of by Washington. Sadly, I doubt it will happen, no matter what party is in charge.

What do you suggest? A tariff war? Telling other WTO countries to not buy Japanese goods? Both are ridiculous. Two wrongs do not make a right.
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The facts are Toyota, Honda, Nissan, BMW, MB, Hyundai, etc., are creating jobs in the US - The Big 2.5 are not and have not in 25+ years.

And let us not forget - the transplant operations are legally US corporations.

Edited by evok
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What do you suggest? A tariff war? Telling other WTO countries to not buy Japanese goods? Both are ridiculous. Two wrongs do not make a right.

I don't care what other WTO countries do. Your comment is either oversimplification of the issue or it's ignorance. Neither is a good thing.

The fact is Japan and Honda are able to operate quite effectively against GM and Ford because they have a huge cost advantage being non-union. Before they came to the US, they built their vehicles offshore for a fraction of Union labor costs (which is what got them enough profits to build plants here.)

I "suggest" the UAW be tossed out on their collective asses in September if they aren't well along with unionizing Toyota and Honda plants in the US.

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Democracies, unfortunately, by their nature are not long term entities. Corporations are worse. Washington only cares about the next 4 years; Wall Street the next quarter. Japan Inc. (with the help of MITI) has been milking both these facts for decades.

America has traditionally been the biggest at everything for the past 100 years and pretty much used to getting her way. The irony here is that under the rush to Free Trade, America may be sewing the seeds of her own destruction.

First of all, under the notion of dragging Third World countries up to our own level of affluence, America has allowed her current account balance to spiral dangerously out of whack. Was not the inflation of the '70s a partial result of the over spending on Vietnam? Are there not any parallels with today? If consumers here keep buying Chinese/Indian/Japanese products at the rate we are, those countries will end up owning the American dollar. They already have something like a trillion dollars in US Treasury bills anyway.

Do you guys have any idea what kind of clout that gives these countries? Washington proceeds with the misguided notion that America is the only market worth exploiting. What happens when China and India's middle class can float the boom on their own? When these countries can stand on their own two feet America will be competition, not a market. What would happen to the U.S. dollar if those countries cashed in their chips?

Hmm, maybe that is why Japan Inc. is in such a rush to open plants here. With a U.S. dollar worth half that of a Euro, Japanese exports would be prohibitively expensive and even Japan couldn't devalue the yen enough to stay under the dollar with China and India dumping their treasury bills.

A nightmare scenario, indeed.

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If consumers here keep buying Chinese/Indian/Japanese products at the rate we are, those countries will end up owning the American dollar. They already have something like a trillion dollars in US Treasury bills anyway.

Do you guys have any idea what kind of clout that gives these countries? Washington proceeds with the misguided notion that America is the only market worth exploiting. What happens when China and India's middle class can float the boom on their own? When these countries can stand on their own two feet America will be competition, not a market. What would happen to the U.S. dollar if those countries cashed in their chips?

Hmm, maybe that is why Japan Inc. is in such a rush to open plants here. With a U.S. dollar worth half that of a Euro, Japanese exports would be prohibitively expensive and even Japan couldn't devalue the yen enough to stay under the dollar with China and India dumping their treasury bills.

A nightmare scenario, indeed.

http://globaleconomicanalysis.blogspot.com/

Read the entry for January 11, 2007 for one possible scenario.

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The facts are Toyota, Honda, Nissan, BMW, MB, Hyundai, etc., are creating jobs in the US - The Big 2.5 are not and have not in 25+ years.

That is beside the point that the vast majority of jobs (75-80%- don't have the exact number on hand) are sourced from the domestics- how is catering to the 25% over ignoring the 75% the proper thing to do? What is being done to protect the 75% of jobs that is steadily dwindling??????????

And let us not forget - the transplant operations are legally US corporations.

Laws are overwritten every day. U.S. sales arms are not independant corporations, but subsidiaries of a parent corp organized in a foreign country, no? They -for the most part- are banking billions (75% of corporate profits for toyota) from this country- That's cargo ships of money sailing offshore... they need to be somehow licensed or taxed on that profit. Tax them thru licensing- they WILL NOT LEAVE: the income from the US Market is their primary bread & butter. Be consistant, U.S. Government: if you don't care about the future of the domestic auto industry, you shouldn't be afraid to not care about the foreign automakers here either. Like I said: THEY WILL NOT LEAVE. Meanwhile, the money floats over the ocean....
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one thing i wonder about now is if the Japanese were forced to unionize their plants here in America, if they would still be screwed as far as trying to move production back to Japan, because now India, Korean, China, all can beat the Japanese in production costs.

I think that the biggest advantage Toyota and Honda have for the vehicles they produce in this country is that there work force is younger and healthier. That of course is changing as their employees age and the domestics "retire" their older employees through buyouts. Will it happen fast enough to save the home team? I think so, but how the hell would I really know.

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I can't be the only one that gets disgusted every time I see that word.

I didn't care for the comment either. It was just flame bait in my book and chose to ignore it. It's just crude and unsophisticated.

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That is beside the point that the vast majority of jobs (75-80%- don't have the exact number on hand) are sourced from the domestics- how is catering to the 25% over ignoring the 75% the proper thing to do? What is being done to protect the 75% of jobs that is steadily dwindling??????????

Laws are overwritten every day. U.S. sales arms are not independant corporations, but subsidiaries of a parent corp organized in a foreign country, no? They -for the most part- are banking billions (75% of corporate profits for toyota) from this country- That's cargo ships of money sailing offshore... they need to be somehow licensed or taxed on that profit. Tax them thru licensing- they WILL NOT LEAVE: the income from the US Market is their primary bread & butter. Be consistant, U.S. Government: if you don't care about the future of the domestic auto industry, you shouldn't be afraid to not care about the foreign automakers here either. Like I said: THEY WILL NOT LEAVE. Meanwhile, the money floats over the ocean....

I wouldn't assume they don't pay taxes on the profits realized by their US Subsidiary. I work for a multinational with its HQ in Canada and I'm certain our US Corp pays US taxes. Companies get audited for this type of stuff to make sure they pay. Otherwise everyone would declare their HQ's offshore and no one would pay taxes. Edited by frogger
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SO who do you blame? I've seen the type of places they build these plants. Factories shutting down (sewing factories where a HUGE source of income in rural America), farming lost to corperate farms, Young people moving away. Then this comapny shows up, Hyundai, Toyota, Nissan, and offerws to build a plant that will employ hundreds of people. Good paying jobs that will in turn bring McDonalds and Walmart calling, get contractors to work building housing for these newly affluant workers, A few car lots, maybe a mobile home dealer. What is your incentive to turn them down? Definatly not so some (As you precieve them) fat lazy union workers, rich corupt politicians, or mega-rich domestic CEO. Not to mention GM could have done the same thing.

As for politicians, they can smell a winner. They have made sure all the laws were worded to allow loopholes so the biggest trucks and SUV's are not hurt in sales, largely due to money from the big three and UAW, only to get blasted as corrupt when gas shot up and Americans couldn't afford to fill up the 10 MPG VEHICLE THEY BOUGHT!!!!!! Now they are saying, "Hey, the big three have had a decade to compete and are still losing, people in my district LIKE Toyota, and they are building cars that more people want to buy, maybe I need to take money from them."

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I wouldn't assume they don't pay taxes on the profits realized by their US Subsidiary. I work for a multinational with its HQ in Canada and I'm certain our US Corp pays US taxes. Companies get audited for this type of stuff to make sure they pay. Otherwise everyone would declare their HQ's offshore and no one would pay taxes.

Absolutely. Foreign corporations pay U.S. income taxes on their U.S. income, but do not pay U.S. income taxes on their foreign income. However, there are a lot of controversies between these corporations and the U.S. government on transfer pricing and other international tax issues.

U.S. corporations are taxed on their worldwide income, but usually get a foreign tax credit for taxes paid to foreign countries on foreign income.

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Point 1: "That is beside the point that the vast majority of jobs (75-80%- don't have the exact number on hand) are sourced from the domestics- how is catering to the 25% over ignoring the 75% the proper thing to do? What is being done to protect the 75% of jobs that is steadily dwindling??????????"

Poiont 2: "Laws are overwritten every day. U.S. sales arms are not independant corporations, but subsidiaries of a parent corp organized in a foreign country, no? They -for the most part- are banking billions (75% of corporate profits for toyota) from this country- That's cargo ships of money sailing offshore... they need to be somehow licensed or taxed on that profit. Tax them thru licensing- they WILL NOT LEAVE: the income from the US Market is their primary bread & butter. Be consistant, U.S. Government: if you don't care about the future of the domestic auto industry, you shouldn't be afraid to not care about the foreign automakers here either. Like I said: THEY WILL NOT LEAVE. Meanwhile, the money floats over the ocean...."

Point 1: I am unsure of what you are trying to say with this but I believe you are citing those convuluted stats from from one of those buy American anti foreign lobby groups. The facts are the big Asian companies are designing vehicles in the US today and for US production are suing suppliers with operations in the US. That may include Japanes transplant suppliers or US suppliers. That can also include parts designed locally designed in the US and manufactured overseas or locally. For the most part that is the same supplier relationship the domestics use. i.e. Airbags might be designed right off I75 in MI and manufactured in Mexico or Utah.

The whole automobile if Japanes or Domestic is so global at the moment it is impossible to pin point what the US contribution is to the vehicle or what % is designed in the US or overseas. As a result of global cost pressures - the automobile business is becoming effecient and labor sourced where it makes sense.

i.e The NG Saturn Vue. US designed platform, program designed in Korea, manufactured in Korea and Mexico.

Point 2: I defer to ehaase's most recent post.

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On another note - what exactly make a US, German, Japanes, British company today? I can, you can, a Mutual Fund can purchas shares, an ADR into almost any public company in the world. If I wanted to I can purchase shares in Toyota so I am seeing less and less the relevance of where a company is HQed.

http://quotes.nasdaq.com/quote.dll?mode=st...amp;selected=tm

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