Is Magna International a Modern Day Robber-Baron?

Tea Party politicians are feeling the heat from all sides. A mayor from Troy, Michigan turned down a federal grant for a transit center, because she believed it wasn’t appropriate to add to the $15 trillion debt. However, business interest sees things differently.

Troy— Troy faced quick fallout Tuesday after scrapping plans for a federally funded transit center, as an official with a local auto supplier said he would urge the company to look elsewhere for future investment.

Frank W. Ervin III, manager of government affairs for Magna International Inc., made the comment in an email Tuesday to the president of the Troy Chamber of Commerce, Michele Hodges. In the private message to Hodges, Ervin called the city's leaders "narrow-minded when it comes to the future of Troy and the future of Southeastern Michigan" for rejecting $8.4 million in federal aid.

In the email, Ervin thanked the chamber president for her efforts to win approval for the transit center and said he plans to draft a memo to all Magna group presidents and corporate executives "strongly recommending" that the automotive supplier "no longer consider the City of Troy for future site considerations, expansions or new job creation."

To be fair to Magna International, their official stance is they have no opinion on the matter. But if you dig deep enough, you’ll see this company is corporate welfare whore, that salivates over taxpayer largess. Here are a few examples:

The government of Ontario recently announced an investment of C$432 million (US$441 million) to advance the development of electric vehicle technologies. Some C$48.4 million of the total investment will come from the provincial government.

The money is earmarked for Magna International, an Aurora, Ontario-based company. Currently the largest automotive supplier in North America, Magna will use the funding to further develop its electric car systems and continue its exploration of next generation clean vehicle technologies.

"Ontario has always been the province that leads by determining where we need to be and working to make that happen,” says Sandra Pupatello, Ontario’s Minister of Economic Development and Trade. “Our government's investment in Magna International and Magna E-Car is one way we are making the future happen now."

And of course, here is a subsidiary screwing over the U.S. taxpayer with this green energy fraud:

Magna International Inc., North America's largest automotive supplier, is opening a plant in south Phoenix to make parts for solar panels, joining Arizona's growing cluster of renewable-energy businesses.

The company, based in Ontario, Canada, announced Tuesday that its Cosma International unit is opening a 166,000- square-foot building this month to make metal structures, components and systems for the photovoltaic, or solar-panel, market.

And where are they getting their funds?

When the Cosma Power Systems plant at 4570 W. Lower Buckeye Road opens this month, it will create 50 to 60 full-time jobs and represent an investment of about $6 million, according to the company and the Arizona Commerce Authority.

Cosma expects to create about 150 jobs with an average annual wage of $45,312 in three years, said Kristen Hellmer, spokeswoman for the Arizona Commerce Authority.

Don Cardon, president and CEO of the authority, said the company will use the state's renewable-energy tax-incentive program to help create jobs. Legislators approved those incentives in 2009.

Who better exemplifies a robber-baron: Cornelius Vanderbilt or Magna International? Here is an appropriate and stark example of corporate citizenship involving a transit center . Cornelius Vanderbilt built Grand Central Terminal and the rail lines without aid from government entities, whereas Magna International thrives off of taxpayer largess.

Later, the state of New York demanded modernization of Grand Central Terminal and its rail lines and without any cost to the taxpayers. The PBS show American Experience described how this was done:

Narrator: The initial estimates of Wilgus' plan were staggering. At a time when the total yearly revenue for the New York Central was $80 million, Wilgus projected a cost to complete of 40 million. Within a year that estimate jumped to 60, then 70 million. And even though the city and the state had mandated the project by banning steam in Manhattan, not a single dollar of public money went into Grand Central's reconstruction.

But William Wilgus was undaunted. Rather than scale back, and design a lesser Grand Central, he devised a revolutionary way for the railroad to self-finance the entire project.

Frank Prial, Architect: Now Wilgus recognizes his audience. He realizes he's dealing with businessmen. He suggests that the railroad take advantage of one of its primary assets: real estate. Because it can convert what is essentially a lost expanse of open scar on the city's topography -- this vast field of train tracks and equipment -- and turn that into one of the greatest single real estate residential developments in American history.

I ask again, who are the real robber-barons?

Source: http://www.azcentral.com/business/articles/2011/12/13/20111213magna-international-open-plant-phoenix.html#ixzz1hfl4EPfg

http://www.detroitnews.com/article/20111221/METRO02/112210353/1009

http://www.pbs.org/wgbh/americanexperience/features/transcript/grandcentral-transcript/

http://analysis.evupdate.com/industry-insight/canada-ontario-government-emerging-ev-hub

Obama's Green Barons Shame 19th Century Robber Barons

Obama’s Green Barons make the Robber Barons of the 19th century look like a bunch of pikers. First of all, the derogatory term “Robber Baron” was used to portray early American capitalist as a bunch of heartless thieves exploiting the American people as if they were nothing but mere chattel. That kind of depiction is overall, historically inaccurate and has been a recurring anthem from the anti-capitalist and anti-corporatist to this day.

Author Thomas J. DiLorenzo writes:

It is a staple of history books to attach this derogatory phrase to such figures as John D. Rockefeller, Cornelius Vanderbilt, and the great nineteenth-century railroad operators — Grenville Dodge, Leland Stanford, Henry Villard, James J. Hill, and others. To most historians writing on this period, these entrepreneurs committed thinly veiled acts of larceny to enrich themselves at the expense of their customers. Once again we see the image of the greedy, exploitative capitalist, but in many cases this is a distortion of the truth.

As common as it is to speak of "robber barons," most who use that term are confused about the role of capitalism in the American economy and fail to make an important distinction — the distinction between what might be called a market entrepreneur and a political entrepreneur. A pure market entrepreneur, or capitalist, succeeds financially by selling a newer, better, or less expensive product on the free market without any government subsidies, direct or indirect. The key to his success as a capitalist is his ability to please the consumer, for in a capitalist society the consumer ultimately calls the economic shots. By contrast, a political entrepreneur succeeds primarily by influencing government to subsidize his business or industry, or to enact legislation or regulation that harms his competitors.

And there is no doubt that political entrepreneurs infest the Obama administration. The whole renewable energy movement is subsidized by the American taxpayers through DOE guaranteed loans. Many of these companies have filed bankruptcy. The corruption is so severe that analyst state a tsunami of green failures is heading our way. Peter Schweizer’s book, Throw Them All Out goes into detail on how crony capitalism has gone wild at the White House. Big Government.com writes:

The details of how the DOE loan scheme was apparently conducted are almost as shocking as the billions bagged by Obama’s backers.

Instead of appointing a team of scientists or engineers to direct the DOE’s loan program office, Schweizer contends, the Obama administration placed some of the president’s biggest fundraisers in control. For example, Steve Spinner, who served on the Obama campaign’s National Finance Committee and was himself a top bundler, was tapped as the “chief strategic operations officer” for the DOE’s loan programs. Spinner was joined at DOE by another Obama fundraiser, Sanjay Wagle, and by Democrat donor Jonathan Silver, who would serve as executive director of the program.

With the scientists and engineers effectively out of the way, and the President’s top backers at the levers of the DOE’s loan program, the Obama administration was able to funnel billions of taxpayer dollars back to green energy companies associated with the President’s political and financial patrons.

For members of Obama’s national finance committee, the returns on investing in Obama’s 2008 campaign were incredibly lucrative, according to Schweizer. For every dollar committee members raised, they received $24,783 in return in the form of DOE sweetheart loans, on average.

Future historians will say that the Obama administration is the most corrupt in American history and that his Green Barons shamefully exploited the United States treasury. Let’s just hope that is the only footprint that this president leaves.

Source: http://mises.org/daily/2317
http://biggovernment.com/whall/2011/11/17/shock-claim-energy-dept-kickbacks-make-obama-americas-biggest-crony-capitalist-ever/