California has lots of problems as everyone knows, and manufacturing is in a virtual free fall there. I suppose it is a case of the forest and the trees, in which Californians have their noses pressed so hard up against the bark of their favorite tree that the big picture is hard to discern. From my lofty perch in Illinois, however, I can see a pretty obvious solution: Kevin Meyer needs to host a 'Wine Summit' in his backyard and the State can get on the fast track to turning it all around. I know Obama is more of a beer guy, but this is California and he will just have to make accommodations.
It's all fairly simple:
GM backed out of NUMMI, so it is folding and over 4,000 auto manufacturing jobs are going down the drain early next year.
Toyota is threatening legal action if California does not give them the $2 million promised last year for worker training. It seems that a guy named Barry Broad– a liberal Democrat, a union champion and an Obama guy – sits on the board that doles out the grants and he does not think the State should honor their promise because the workers were trained for auto jobs and there are no auto jobs for the soon-to-be-unemployed NUMMI folks to perform. He apparently bought into the 'vast right wing conspiracy theory' and thinks the whole collapse of GM and NUMMI was a well orchestrated plot to scam the State out of the $2 million.
Way down south is the Fisker Automotive company. They are rolling out an environmentally and politically correct car called the Karma that the Hollywood gang – who are lockstep Obama folks – is lining up to buy in advance. Fisker are also Obama guys – in fact Al Gore has a big stake in Fisker.
Back up north is a guy named Matt Rogers – another Obama guy – who runs the Department of Energy's Advanced Technologies Vehicle Manufacturing Loan Program. He scrounged up better than a half a billion bucks for Fisker so they can manufacture Karmas for the celebs. The problem is that Fisker and Mr Rogers decided to send that big sack of cash to Finland so the Finnish economy could be stimulated by making the cars.
From 2,000 miles away it seems to me that Toyota will gladly take their $2 million and walk away from California. If Rogers will pay them from the $528.7 million he plans on sending to the Finns, that would still leave him with a hefty sum. The rest of the cash should go to getting the Fisker folks set up in the old NUMMI plant with those trained workers. Are you beginning to see the logic? Keep the cash in California and keep the auto jobs Mr Broad thinks are gone for good? And it is all Obama folks involved, so they ought to be able to pull it off (except the Japanese and they just want cash).
I am sure there are a few flies in the ointment. The most obvious is that the Hollywood gang is pretty entrenched in the their conviction to buy stuff made anywhere but in the USA, but perhaps the NUMMI plant could be sold to Finland for $1 and leased back from them for 99 years by Fisker for $1 a year, which could appease the Karma buyers that the cars are being made on Finnish soil. It might take some arm twisting to convince them that a car made by ex-Toyota employees is as good as one made in that center of world class manufacturing excellence – Helsinki – but it is worth a shot.
The Finns might be a bit peeved with the plan, but I think we can survive the bloodletting of a trade war with them. I know that, as an Illinois resident, I am willing to sacrifice the sudden absence of Finnish goods in my life this might cause for the good of my American brothers and sisters in California, and I think the rest of the country will show similar solidarity.
It seems to me that everyone involved follows Mr Obama with a passion, and that might just be enough to form the basis of an agreement. As the map shows, Kevin is situated smack dab in the center of the concerned parties, and those who follow Kevin on Twitter know that he is quite the wine aficionado. It's worth a shot, Kevin. Invite Obama and the folks from NUMMI and Fisker over to Morro Bay, along with Messrs. Broad and Rogers. Ken Howard is the new President of the Screen Actors Guold and I am sure he can help protect the Karma customer base. Pull the cork on a couple of bottles of the good stuff and see if you and Barack can't make history and save California from itself.
Mark Welch says
Why in the H-E double toothpicks do Fisker and Rogers feel the need to stimulate the Finnish economy? Is there some kind of sweetheart deal the government made that they think they have to abide by? I don’t know why else they would want to do this.
Oh, and Kevin, this summer my wife and I finished planning for a CA wine tour from October 10 – 17th, so we’d appreciate your planning the summit around that :-)
Just Some Guy says
Ken Howard? The White Shadow?
…thought he was dead…
Bill Waddell says
The White Shadow dead? You must be joking. No one can keep the White Shadow down. He is alive and well and defending the rights of the oppressed acting community in Hollywood.
There are a bunch of us [few] remaining manufacturing folks in California that think we can still make a profit here [for now]. But just today I sat in on a roundtable of local businessdudes and almost all of them were commenting on how much they could save by simply moving their operations next door to [no tax] Nevada to avoid onerous red tape, byzantine overtime rules, and rising taxes. Sort of interesting how the states with the lowest unemployment and whose budgets are in the best shape are also the states with the lowest taxes. Go figure. I won’t go into the bureaucratic resistance, now successfully resolved, we had in trying to build a large new manufacturing facility in wine country… because we weren’t a winery. Nope, just a manufacturer providing high-paying upwardly-mobile jobs instead of minimum wage vineyard workers. Somehow wine tourism is expected to save the day!
But there is hope. Just today (as many of you may have read in the WSJ), Schwarzenegger’s bipartisan tax commission came out with some recommendations that will vastly simply the tax structure. The controversial part is that it would also significantly REDUCE taxes on the “wealthy” (ie business owners who hire other people) and broaden the tax base away from pure income so the revenue stream doesn’t dry up every time the economy lightens a bit. Of course compare that to the other story in the WSJ on how 47% of U.S. households no longer pay taxes… approaching the 50% tipping point we’ve mentioned in the past where tax/spend policy will effectively be determined by a majority that have no skin in the game. In effect the country is heading toward the disaster that California has already experienced. Hindsight? Foresight?
Come on out for some wine! Harvest season just kicked off and the local roads are clogged with grape pickin’ equipment. We need your wine tourist dollars… since manufacturing isn’t considered important enough to the economy.
Panu Kinnari says
Hey, give us some slack, we have only one car plant in whole country! :)
And folks at Valmet Automotive are actually pretty decent folk and they know their stuff. Actually I think they have received some kind of recognition from JD Powers atleast couple of times.
I actually wasn’t aware that they are going to do all of the assembly in Uusikaupunki (Not in Helsinki btw). I was under assumption that only cars for european market would be built here and Fisker would have another plant for US market. Guess not then.
15 year friend of nummi says
Here is something to consider. The Toyota people may prefer Saki and since rice is grown in Norther California near Sacramento, no less, then that should be an additional boon to the California economy…..
Martin B says
@ Kevin: Interesting comments. (Posting from another wine producing region — Western Cape, South Africa).