Thursday, December 18, 2008

Michigan Congressmen Exposed: Conflict of Interests With Auto Industry

CBS News reported earlier this month that the Auto Industry spent over $50 Million lobbying Congress and on donations to politicians during the first nine months of 2008. Here are some highlights:

  • Sen. Carl Levin, a Democrat, received $438,304

  • Rep. Joe Knollenberg, a Republican, received $879,327.

  • Rep. John Dingell, a Democrat, received nearly $1 Million!

All have enjoyed generous support from the auto industry over their careers, with GM and Ford as their two top contributors. All support a bailout.

But nobody's been a bigger advocate for Motor City interests than Dingell. And for him, the stakes aren't just political, they're personal.

"There's an actual conflict," said Ryan Alexander of the nonprofit group Taxpayers for Common Sense. "His personal financial health, you know, the wealth of his family is tied up in the car industry."

Dingell's wife Debbie once worked as a lobbyist for GM. When she married the congressman, she became a senior GM executive at an undisclosed salary. And we found the couple has extensive GM assets. Dingell's current financial disclosure filed in May lists GM stock worth up to $350,000, options worth up to $1 million more, and a GM pension fund. In 2000, among the Dingells' GM assets were stock options worth up to $5 million.

And in 1998, the congressman reported selling GM stock options worth up to $1 million dollars. Dingell wouldn't agree to an interview. Taxpayer watchdog Alexander says the Dingell's personal ties to GM are something the public should know about when the congressman casts his votes.

"They stand to benefit if the company doesn't go under, if the company prospers," she said. "And they stand to lose a lot if the company goes bankrupt."

Nobody is placing bets on whether Congress will end up giving the car companies a bailout. But if investments in Washington politicians count as leverage, then the auto industry has plenty of clout.

Dingell is the poster boy for term limits. He came to Congress in 1955, winning a special election to replace his father who had passed away. Some relevant points from his Wikipedia Bio:

Dingell has opposed raising mandatory automobile fuel efficiency standards, which he helped to write in the 1970s. Instead he has indicated that he intends to pursue a regulatory structure that
takes greenhouse gas emissions and oil consumption into account. In a July, 2007 interview with, he said “I have made it very plain that I intend to see to it that
CAFE is increased” and went on to point out that his plan would have increases tantamount to those in the Senate bill recently passed. In November 2007, working with House Speaker Nancy Pelosi, Dingell helped draft an energy bill that would regulate a 40% increase in fuel efficiency standards.

Now, we have already discussed that CAFE standards add an unnecessary burden to the Auto companies. So in receiving millions in his career from the companies, he has tried to appease Environmentalists, yet protect the Auto Makers.

In July 2007, Dingell indicated he planned to introduce a new a tax on carbon usage in order to curtail greenhouse gas emissions. The policy has been criticized by some, as polling numbers show voters may be unwilling to pay for the changes. A Wall Street Journal editorial claimed that vehicle emissions standards that he supports will not yield any substantial greenhouse gas emissions savings.

His conflict of interest with the auto makers is astounding:

Dingell has drawn criticism for his ties to the automotive industry. The three largest contributors to his campaign for the 2006 election cycle are political action committees, employees, or other affiliates of General Motors, Ford Motor Company, and DaimlerChrysler, since 1989, intermediaries for these corporations have contributed more than $600,000 to his campaign. Dingell also holds an unknown quantity, more than $1 million, in assets through General Motors stock options and savings-stock purchase programs; his spouse, Debbie Dingell, worked as a lobbyist for the corporation until they married, whereupon she moved to an administrative position there.At present Ms. Dingell is a senior executive at General Motors and vice chair of the General Motors Foundation. On November 11th, 2008, American columnist Thomas Friedman wrote about the the lack of innovative business culture in American auto industry singling out Representative John Dingell:
"The blame for this travesty not only belongs to the auto executives, but must be shared equally with the entire Michigan delegation in the House and Senate, virtually all of whom, year after year, voted however the Detroit automakers and unions instructed them to vote. That shielded General Motors, Ford and Chrysler from environmental concerns, mileage concerns and the full impact of global competition that could have forced Detroit to adapt long ago. Indeed, if and when they do have to bury Detroit, I hope that all the current and past representatives and senators from Michigan have to serve as pallbearers. And no one has earned the “honor” of chief pallbearer more than the Michigan Representative John Dingell, the chairman of the House Energy and Commerce Committee who is more responsible for protecting Detroit to death than any single legislator."
So its obvious why Michigan Congress Members support a bailout. Republican or Democrat, they all need to be investigated. reports some good insight as well:

“For the last 20 years, the Michigan delegation felt that what was good for the big three was good for Michigan,” said Brendan Bell, Washington representative for the Union of Concerned Scientists. “Instead, 20 years of inaction gave the big three the rope to hang themselves with.”

The saga highlights the perils of congressional efforts to protect regional industries. Responding to evolving consumer tastes, America’s automakers focused much of the last two decades on producing larger, less efficient vehicles, exemplified by the sports utility vehicle, or SUV. Attempts by environmentalists and some lawmakers to install higher fuel efficiency standards were thwarted along the way, with the opposition rallying behind Michigan’s powerful representatives, particularly House Energy and Commerce Committee Chairman John Dingell (D) and five-term Sen. Carl Levin (D). Between 1975 and 2007, federal fuel consumption standards remained unchanged.

Dan Becker, a Washington-based environmental consultant, said that “a wishful blindness” among Detroit’s congressional supporters has greatly contributed to the divide. “The auto industry has suffered from a number of members of Congress who drank Detroit’s Kool-Aid and protected the industry to death,” Becker said. “They’re now suffering because of their short-sightedness.”

**For More Information, gives shows that Congressmen who received the most money from auto makers supported a bailout while those who received little or no donations voted no.

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