[Congressional Record Volume 155, Number 80 (Monday, June 1, 2009)]
[Senate]
[Pages S5900-S5901]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     GM'S SPRING HILL ANNOUNCEMENT

  Mr. ALEXANDER. Madam President, General Motors' decision to put the 
Spring Hill plant in Tennessee on standby is a blow to many employees 
who work there and to their families, but hopefully it will be a short-
term problem. I have discussed with Governor Phil Bredesen how I can be 
of as much help as possible to the families who are affected, as well 
as the suppliers and the dealers. For the longer term, though, there is 
no reason in the world why the New GM cannot build cars and trucks at 
Spring Hill, TN, more competitively than any other location in America. 
Tennessee offers hundreds of suppliers, one of the country's best four-
lane highway systems, a right-to-work law, thousands of trained 
workers, and low taxes. The Saturn plant was said to be the largest 
U.S. capital investment in history, and since then, General Motors has 
spent hundreds of millions of dollars modernizing it. For the same 
reasons Saturn and Nissan, Volkswagen, and their suppliers located 
here, Tennessee will continue to be a major automotive center.
  What is more, General Motors has a proud history in Tennessee. As 
Governor of our State in 1985, I wrote the full-page ad for the Wall 
Street Journal. I took almost all of our economic development funds for 
advertising that year, and the ad proudly said this: ``Saturn finally 
found a home in Spring Hill, Tennessee.'' Saturn was the most sought-
after plant in America then. A Saturn car had not been built then. Yet 
the name was better known than Pontiac, which had been on the market 
for 60 years. Saturn, together with the arrival of Nissan a few years 
earlier, helped to attract auto industry to a State--Tennessee--that 
had almost no auto jobs and to a region that had very few auto jobs. 
Today, nearly 150,000 jobs--or about one-third of Tennessee's 
manufacturing jobs--are auto related, almost all of them at suppliers 
to the 12 auto-assembly plants that are now located in the Southeastern 
United States.
  Madam President, I would like to look ahead a little bit toward the 
New GM and the Government ownership of 60 percent of what we are 
calling the new General Motors. We are told that when General Motors 
emerges from bankruptcy in 60 or 90 days, the U.S. Treasury will own 60 
percent of the New GM. To avoid the possibility of the Government 
owning New GM for years, I will introduce legislation authorizing the 
Treasury to distribute to individual taxpayers all of its stock in the 
New GM and in Chrysler as soon as is practical following the emergence 
of the New GM from bankruptcy proceedings. So instead of the Treasury 
owning shares in the New GM and Chrysler, you would own them if you 
were one of 154 million Americans who filed individual Federal tax 
forms on April 15.
  The stock certificates would be in your name, not that of your 
Government. To keep it simple, and to help the little guy also have an 
ownership stake in America's future, Treasury would give each taxpayer 
an equal number of the available auto shares.
  The Treasury Department has said it wants to sell its auto shares as 
soon as possible, but Fritz Henderson, the president and CEO of General 
Motors, told Senators and Congressmen in a telephone call this morning, 
in which I participated, that while it is the Treasury's decision to 
make, this is a ``very large amount'' of stock, and that the orderly 
offering of these shares to establish a market might have to be 
``managed down over a period of years.'' Another option, of course, 
might be to sell blocks of the New GM stock to one or more large 
investors, but that might also take years.
  So I want the Treasury also to have the option of getting the 
ownership of these companies out of the hands of Washington and back in 
the hands of the marketplace in months rather than years. Distributing 
New GM shares and Chrysler shares to individual taxpayers is the way to 
do that.
  Those shares might not be worth very much today, but put them away 
and 1 day they might help pay for a college education. For example, 
General Motors' 610 million shares were only worth 75 cents just before 
bankruptcy, but they were worth $40 per share 2 years ago.
  I would not interfere with the loans the Federal Reserve Board made 
to companies in trouble. The Fed is independent. Its loans are 
collateralized. It makes money for the Treasury. I am only talking 
about the taxpayer bailouts that Congress has authorized since last 
October that have resulted in Government ownership of auto company 
assets.
  Under my proposal, the fiduciary duty that management owes to owners 
would be owed to the more than 154 million Americans owning New GM 
stock and not to a few Washington politicians and bureaucrats.
  You know what would happen if the Treasury owned 60 percent of the 
New GM for the next several years: Members of Congress would start 
holding hearings and saying things such as: ``We are the owners and we 
demand to know why are you building this model? Why are you closing the 
plant in North

[[Page S5901]]

Carolina and not in Tennessee? Why are workers not paid more? What 
about these work rules? Why is this battery being built in South Korea 
and this engine being shipped from Mexico?''
  When the company negotiates with the Federal Government on such 
things as, for example, fuel efficiency standards, won't it be 
negotiating with itself? And as the elections approach, might not the 
White House be tempted to build plants in States it might carry instead 
of States it might not?
  As the New York Times editorialized this morning:

       It was only March when the Obama administration let GM 
     slide toward bankruptcy by denying it more taxpayer money, 
     partly on the grounds that the company was too heavily 
     dependent on SUVs, while its biggest stab at fuel economy, 
     the Volt, was too expensive to work in the near future.

  Not long after that, we saw the President of the United States fire 
the president of General Motors. So if it is going to take years to 
sell the Treasury's New GM stock and Chrysler stock, the best way to 
help those auto companies succeed and recover the taxpayers' more than 
$50 billion in loans may well be to simply give all the Government 
stock to taxpayers and get Washington out of the business of owning and 
running auto companies--the sooner the better.
  Here is one disadvantage. Giving the stock to taxpayers might well 
add a few billion dollars to the Federal debt. But whose debt is it, 
anyway? The 154 million taxpayers'. So why not give individual 
taxpayers the ride up, if there is to be one.
  Some will say another disadvantage is that the old GM will not be 
able to sell its tax breaks to an acquiring company. But these tax 
breaks would be just another bailout paid by taxpayers. It would be 
better to distribute the Treasury's stock to individual taxpayers and 
let the marketplace decide what happens, rather than spend billions 
more on bailouts.
  Here are the advantages as I see them. No. 1, 154 million new 
investor cheerleaders. Think fan base of the Green Bay Packers, whose 
ownership is distributed among the people of Green Bay. This new 
investor fan base could produce customers for the auto companies.
  No. 2, better odds for success. Does anyone think Washington can run 
car companies? Did you ever ride in a Lada, a clunky Soviet car made by 
a government-run company? The standing joke was: How do you double the 
value of a Lada? Answer: Fill up the tank with gas.
  No. 3, fairness. Decisions about these auto companies would be made 
by collective decisions of people in a marketplace rather than by 
lobbyists with access to Washington.
  No. 4, any benefits are more likely to go to taxpayers rather than to 
some Government program. For example, the law says that all proceeds 
made from the Troubled Assets Relief Program, TARP, purchased assets 
should go to reduce Government debt. Yet that is not happening because 
Treasury has not purchased toxic assets yet and has not made any profit 
yet. My proposal would make sure taxpayers get the profit rather than 
recycling this money into more bailouts.
  Finally, this is the fastest way back to the wise principle, if you 
can find it in the Yellow Pages the Government probably should not be 
doing it. More than the money, it is the principle of the thing.
  The other day a visiting European automobile executive said to me, 
with a laugh, that he had come to ``the new American automotive 
capital: Washington, DC.''
  To get our economy moving again, let's get our auto companies out of 
the hands of Washington and back into the marketplace--the sooner the 
better.
  I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. SESSIONS. Madam President, I ask unanimous consent the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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