“Think about it. If you are a member of the union right now, you’re spending all your time negotiating about health care. You need to be spending some time negotiating about wages, but you can’t do it," he said.

In fact, the UAW locked itself into a contract limiting wages and changes to health care, without the ability to negotiate with a threat of strike, until 2015. These stands were agreed to by the union at the prodding of the Obama administration, which demanded that union autoworkers accept lower wages -- as a condition to the bailout that saved Lordstown -- to match non-union workers at Toyota plants in Kentucky and Honda plants in Ohio.

Even so, Lordstown is something of a success story for both the UAW and GM, and Obama's remarks were punctuated with enthusiastic applause.  After winning deep concessions from the UAW in 2007, GM agreed to invest $500 million to retool the plant to make a new fuel-efficient small sedan, the Chevy Cruze.

Obama had nice things to say about the Cruze, which GM expects to get more than 40 miles-per-gallon in highway driving.

"I just sat in the car," Obama said of the Cruze. "I asked for the keys. They wouldn't give me the keys. I was going to take it for a little spin. But it was nice sitting in there. It was a roomy car."

Consumers will not get the keys to a new Cruze, either, until the middle of next year when it arrives in showrooms. In the meantime, Lordstown is stuck building the Cobalt, a budget-minded Chevy and vestige of the "old GM." 

Consumer Reports in its October edition branded the Cobalt as one of the five "cruddiest cheap cars" on the market.

(Writing by Kevin Krolicki. Reuters photo by Larry Downing.)

While the $3 billion “Cash for Clunkers” blockbuster is over, Congress is not finished with Detroit.

No one is talking about a “Return of Clunker” or “Son of Clunker” sequel, but it still looks as if car companies will renew their part in the congressional agenda even as another humongous production — healthcare — threatens to swallow the Capitol whole.

A priority for Democrats everywhere is to push the benefits of economic stimulus and pound the podium on job creation. Thursday, the focus is on the future of manufacturing in the economically hard-hit Midwest — a battleground in any election scenario.

House Majority Leader Steny Hoyer will travel to Michigan to discuss legislation working its way through the chamber that would provide hundreds of millions of dollars to help spur development of advanced technology vehicles - like better hybrids and all-electric cars.

A fellow Democrat who is the driving force behind the bill, Representative Gary Peters, will join Hoyer and auto and supplier execs at a late-afternoon news conference in Troy. Peters’ district includes facilities operated by Chrysler and General Motors — both of which have cut tens of thousands of jobs and are trying to find their way after bankruptcy.

The Obama administration and fellow Democrats in Congress have pushed for billions in battery development and other projects this year to jump-start a new generation of fuel efficient vehicles and plant seeds for a “green” economy in Michigan, Ohio and other states where traditional manufacturing jobs have disappeared.

Photo credit: Reuters/Rebecca Cook (crushed vehicles to be shipped to the shredder in Detroit)

Millions of Americans could be staring at blank TV screens tomorrow, when broadcasters switch to digital signals.

The U.S. government has spent years preparing for the switch, which aims to free up airwaves for broadband and enhanced emergency communications.

The change-over will only affect those who get their TV over the air, rather than through cable or satellite connections.

But many consumers probably still haven’t gotten a converter box which will allow them to watch the new digital signals with their rabbit-ear antennas.

That means they’ll miss out on the frothy mix of news and entertainment (newsertainment?) of NBC’s “Today Show,” where this morning Alaska Gov. Sarah Palin declared she’s “absolutely not necessarily” the future of the Republican Party.

In case you’re wondering, Palin’s still steamed at talk show host David Letterman, who made sexual jokes about her daughter a few nights back.

“It was a degrading comment about a young woman and I would hope people really start rising up and saying it’s not acceptable,” Palin said.

In Washington, the CEOs of General Motors and Chrysler appear before Congress to explain the process of closing dealerships — not a popular move with lawmakers who have taken millions in campaign contributions from car sellers.

President Barack Obama meets Zimbabwean Prime Minister Morgan Tsvangirai at the White House at 3:30.

Photo credit: REUTERS/Ray Stubblebine (Palin joins former New York City Mayor Rudy Giuliani and wife Judith Nathan at a Yankees game, June 7)

For more Reuters political coverage, click here.

Even though it was expected, it was still a jolt: GM declared bankruptcy this morning, the third-largest bankruptcy filing in U.S. history and the biggest ever in U.S. manufacturing.

Unthinkable a decade ago, now General Motors is yet another casualty of the cratered U.S. economy, with taxpayers putting up $30 billion for a 60 percent stake in the company. The GM filing followed just hours after a bankruptcy judge approved the sale of virtually all of automaker Chrysler’s assets to a group led by Italy’s Fiat SpA.

Within minutes of the filing, the headlines were rocketing around the Web:
The Washington Post: “Filing Marks the End of Financial Independence for Industrial Icon”
The New York Times: “A Risky Bet to Save an Icon of American Capitalism”
The Drudge Report led its page with a photo of the GM logo under a U.S. flag, headlined: “Government Motors.”

It wasn’t a total blue Monday for the U.S. economy, though, as consumer spending eased and personal income rose in April, the largest increase in almost a year.

President Barack Obama, fresh from a slightly controversial “date night” in New York City over the weekend, will be talking about the automotive industry at the White House around midday, before an afternoon visit to the National Naval Medical Center. The Senate returns from recess today, with the House still out.

Moving back to work after a gorgeous weekend in the Washington DC area, the morning television shows led with the disappearance of an Air France passenger jet over the Atlantic on its way from Brazil to Paris. There was condemnation of the fatal shooting of Dr. George Tiller, one of very few U.S. physicians who performed late-term abortions, who was gunned down at his church on Sunday. And there was also the inevitable post-mortem of the “Britain’s Got Talent” contest result on Saturday, in which sudden media star Susan Boyle sang well but not well enough to ace out Diversity, the winning dance troupe.

For more Reuters political news, click here.

Photo credit: Photographer: REUTERS/Rebecca Cook (’Buy American’ sign, in support of Detroit’s auto industry, is seen in the back of an auto scrap yard in Detroit, Michigan May 18, 2009.)

President Barack Obama is back on the campaign trail.

But this time he’s not trying to win himself a job …he is trying to win over support for his Supreme Court nominee,  Sonia Sotomayor.

Even though regular Americans — or the elite Democrats attending fundraisers — don’t get to vote for Supreme Court nominee, they can pressure their senators.

Sounding like he did while stumping for more than a year on the campaign trail, Obama spoke passionately about his choice of Sotomayor — the first Hispanic woman ever nominated to the high court — to Democrats at a fundraiser for Democratice Majority Leader Harry Reid in Las Vegas.

 He also sent around a video message about Sotomayor to supporters, campaign-style.

“This decision affects us all — and so it must involve it all. I’ve recorded a special message to personally introduce Judge Sotomayor and explain why I’m so confident she will make an excellent Justice … The discussions that follow will be among the most important we have as a nation. You can begin the conversation today by watching this special message and then passing it on.”

Obama is using the network that proved so effective for him during the campaign to try to get Senate approval for his first nominee to the court, to replace retiring Justice David Souter.

The president is in Las Vegas for the day before flying to Los Angeles for a fundraiser in the evening. During the day he will talk about the economic stimulus package and highlight areas of progress made in the economy over the past 100 days.

While the Supreme Court nominee got top billing in the newspapers and morning TV shows, investors are still thinking about the future of General Motors.  The largest U.S. automaker is moving closer and closer to a bankruptcy filing that is expected in the next week or so.

For more Reuters political news, click here.

Photo credit: REUTERS/Jason Reed (Obama speaks at fundraiser in Los Vegas); REUTERS/Christinne Muschi (GM dealership in Montreal)

President Barack Obama announced Sonia Sotomayor as his nominee for the Supreme Court this morning.

Sotomayor will be the first Hispanic named to the court and would increase the number of women currently sitting on the court to two.

A reading of the tea leaves — via the presidential and vice presidential schedules — had increased chatter this morning that President Barack Obama could announce his nominee for the Supreme Court as soon as today.

Both Obama and Vice President Joe Biden are in town — at least for the morning — today before heading west on separate trips. Obama leaves the White House at 4 pm for Las Vegas where he will attend a fundraiser for Senate majority leader Harry Reid before going to California until Thursday. Biden is around for a bit before heading to Denver to host the Middle Class Task Force and talk about green economy jobs.

Obama had been considering a short list of mostly women for a seat on the nine-member, male-dominated high court. The pick is unlikely to change the ideological makeup of the court since Obama is expected to pick a liberal like Justice David Souter, who announced his resignation on May 1.

Other candidates believed to be considered included Judge Diane Wood of the appeals court in Chicago, Solicitor General Elena Kagan and  Michigan Gov. Jennifer Granholm has also been mentioned as a possible candidate.

Asked about his Supreme Court choice, Obama said in an interview on C-SPAN over the weekend that he wanted “somebody who has the intellectual firepower but also a little bit of a common touch and has a practical sense of how the world works.”

Also on the radar screen this week is the looming bankruptcy of General Motors. United Auto Workers’ officials will gather on Tuesday to hear how many more U.S. factory jobs GM will cut as the auto maker enters what could be its last week outside bankrupty.

GM has been struggling to cut costs and reduce debts in order to continue receiving government aid.

For more Reuters political news, click here

Photo credit: REUTERS/Jonathan Ernst (Obama talks in Rose Garden)

On the day that the government gives itself $787 billion to hand out, turns out there’s nobody in Washington to print it up and hand it out.

After a long Presidents’ Day weekend, President Barack Obama will load the 1,000-page stimulus bill onto Air Force One today and fly it to Denver to sign it into law.

Congress has adjourned for the week after passing the bill on Friday, so lawmakers are likely back home taking credit for — or distancing themselves from — the record-setting spending package.

Secretary of State Hillary Clinton has ditched town as well, on her first foreign trip. She’s in Japan today, before continuing on to Indonesia, South Korea and China.

Automakers hope that the $787 billion isn’t the end of the story. General Motors and Chrysler will submit their restructuring plans to the government today with the hopes of securing additional billions in government aid.

For more Reuters political news, click here.

Photo: REUTERS/Larry Downing (Republican Minority Leader John Boehner and House Minority Whip Eric Cantor look on following the passage of the stimulus package in Washington)

It’s one of the world’s most highly visible vehicles, but paradoxically also one of the most secret — the U.S. president’s armored Cadillac limousine.

The Secret Service said on Wednesday a new presidential limousine would make its debut at President-elect Barack Obama’s inauguration on Jan. 20. The car will likely take the new president from the U.S. Capitol down Pennsylvania Avenue to the White House after the swearing-in ceremony.

“Although many of the vehicle’s security enhancements cannot be discussed, it is safe to say that this car’s security and coded communications systems make it the most technologically advanced protection vehicle in the world,” Nicholas Trotta, assistant director for the Office of Protective Operations, said in a statement.

Not surprisingly, a Secret Service spokeswoman would not be drawn on whether the vehicle was resistant to  bomb or chemical attacks. But it would be a safe guess to say it is.

Cadillac, a division of General Motors Corp., issued its own statement on the new vehicle, saying it had taken steps to ensure no details of its design leaked out during its manufacture.

It said the vehicle, which is completely different to the one now being used by President George W. Bush, had been subjected to “an extreme testing regimen,” for which read: a lot of prototypes were blown up.

“The rear passenger area includes an extensive executive compartment with ample seating space, outward visibility and useful mobile office features,” it added.

The tradition of U.S. presidents using Cadillac limousines dates back to Woodrow Wilson. Franklin D. Roosevelt, Harry S. Truman and Dwight D. Eisenhower used two convertibles dubbed the “Queen Mary” and “Queen Elizabeth.”

“Named after the great ocean liners of the time, the vehicles were 21.5 feet long, weighed 7,660 pounds and were equipped with a full ammunition arsenal, two-way radios and heavy-duty generators,” Cadillac’s statement said.

It will probably be some years before we learn the secrets of Obama’s new limousine.

For more Reuters political news, please click here.

Photo credit: Reuters/Handout (Secret Service handout photo of new Cadillac armored presidential limousine)

Tennessee Sen. Bob Corker (right, in the driver's seat next to Mark Fields, Ford's president of the Americas), who pushed for tough conditions on the $17.4 billion U.S. government bailout for General Motors and Chrysler, said at the Detroit auto show that he hoped Chrysler would find a merger partner to survive.

"Chrysler probably needs to merge with somebody, not necessarily disappear from the standpoint of existence," said Corker, who added the automaker owned by Cerberus Capital Management was not making the needed investment to remain competitive. He spoke to reporters as he toured the show before meeting with executives for GM, Chrysler and Ford.

Corker, whose home state includes the U.S. headquarters for Japan's Nissan, also said he felt GM's debt load was too heavy and it may not meet the restructuring targets set out under the $13.4 billion loan granted to the company by the Bush administration.

The Republican senator met with GM Chief Operating Officer Fritz Henderson and, during his visit to the GM stand at the show, sat in the Cadillac Converj, a luxury model of the all-electric Chevrolet Volt concept car.

Corker said he loved the Jeep he drove before he came to Congress, though he did not specify which model. Chrysler, which received $4 billion in emergency loans, owns the Jeep brand.

The most contentious issue in the Bush administration's bailout plan is a goal that seeks to bring hourly wages for the U.S. automakers' unionized work force in line with those of Toyota and other Japanese automakers operating nonunion U.S. factories.

The labor give-back provisions were spearheaded by Corker and incorporated into the bailout. A proposal to strip the Corker-inspired labor provisions from the automaker rescue was included in legislation introduced in the House of Representatives last week.

The UAW has said it is open to making some changes to help GM and Chrysler lower costs, but has vowed to try and get the administration of President-elect Barack Obama to amend the giveback targets. Obama, a Democrat, takes office Jan. 20.

GM and Chrysler are under tight deadlines to show progress. The automakers must demonstrate to the government within several weeks that they are lowering costs and making other changes required under the Bush administration's bailout plan.

GM CEO Rick Wagoner has said the automaker could seek further loans from the government at the end of March if the U.S. auto market does not improve. 

Corker also made a point during his tour of saying he had flown a commercial plane to Detroit for his visit. "I came Northwest Airlines and I want you to know it was right on time."

The CEOs for GM, Chrysler and Ford were criticized by lawmakers in November for separately flying company jets instead of less costly commercial planes to Washington as they sought billions in bailout funds from Congress.

(Photo/Reuters)

This post was written by colleague Christiaan Hetzner.

Listening to GM Europe CEO Carl-Peter Forster (right), there is a big side benefit of having the thankless job of running a business in danger of being dragged under by its foundering parent. 
 
For one, you are not publicly humiliated by lawmakers with an ax to grind the next time you try and hit them up for aid.
 
Whereas U.S. congressmen eager to score points with taxpayers were just itching to take turns tag-teaming his boss Rick Wagoner, Forster said he is treated with far more respect and understanding by the German and Swedish governments when he participates in discussions over receiving billions in state loan guarantees. GM is looking to sell its Saab brand in Sweden.
 
Asked at the Detroit auto show whether the talks were considered in Europe to be as controversial as those in Washington, Forster replied: "Interestingly enough, the Europeans take a very, very different approach. Much less hostile, virtually not hostile at all, seeing the automotive industry as a very important industry."
 
GM Europe has a funding requirement peaking this year, in part due to this year's roll-out of the new Opel Astra and Saab 9-5 cars, key models for both brands.
 
 "They (state officials) understand the extraordinary circumstances in Europe -- by the way, the circumstances in the U.S. are even more extraordinary than in Europe. They know how important the industry is for the European economy and particularly for certain member states like Germany, France, Italy, the UK and so on. Absolutely no hostility, very open, understand the situation and try to come up with a solution."
 
Perhaps lawmakers in the more socialist governments across the Atlantic better realize what would happen if Opel or Saab cannot get the loan guarantees needed to access to the European Investment Bank's 16 billion-euro fund for the European auto industry, which is only open to companies with an investment grade rating. 
 
(Photo/Reuters)