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May 29th, 2009

Update1 Did Political Contributions Influence the Chrysler Closings?

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UPDATE1: As we originally expected, it seems auto dealers are overwhelmingly Republican to begin with. That being the case, it makes the notion that the White House deliberately chose which Chrysler dealerships to close based on campaign contributions, not only completely foolish but, a mistake even the president’s biggest critics feel even he wouldn’t make.

This is from FiveThirtyEight.com:

Nobody has bothered to look up data for the control group: the list of dealerships which aren’t being closed. It turns out that all car dealers are, in fact, overwhelmingly more likely to donate to Republicans than to Democrats — not just those who are having their doors closed.

Overall, 88 percent of the contributions from car dealers went to Republican candidates and just 12 percent to Democratic candidates. By comparison, the list of dealers on Doug Ross’s list (which I haven’t vetted, but I assume is fine) gave 92 percent of their money to Republicans — not really a significant difference.

There’s no conspiracy here, folks — just some bad math.

It shouldn’t be any surprise, by the way, that car dealers tend to vote — and donate — Republican. They are usually male, they are usually older (you don’t own an auto dealership in your 20s), and they have obvious reasons to be pro-business, pro-tax cut, anti-green energy and anti-labor. Car dealerships need quite a bit of space and will tend to be located in suburban or rural areas. I can’t think of too many other occupations that are more natural fits for the Republican Party.

Original post published on 5/28/09: Claims that the Obama Administration directly influenced which Chrysler dealerships were closed are steamrolling across the internet. Bloggers like Doug Ross have raised the notion based on published lists of dealership owners and their political contributions. Ross concludes that the majority of the axed dealerships had donated exclusively to Republican politicians, while finding “only a single Obama donor (and a minor one at that: $200 from Jeffrey Hunter of Waco, Texas) on the closing list.”

At this juncture it’s important to note, as the Wall Street Journal’s James Taranto puts it, “It must be emphasized that Ross’s evidence is suggestive, not conclusive. It does not appear that anyone has yet conducted a complete analysis of Chrysler dealers’ political contributions.”

Politics’ strong influence on the auto industry is no real secret.  Leonard Bellavia, a lawyer representing some of the closed Chrysler dealerships, said Washington’s influence over the closings were alive and well:

[Mr. Bellavia] deposed Chrysler President Jim Press on Tuesday and came away with the impression that Press did not support the plan.

“It became clear to us that Chrysler does not see the wisdom of terminating 25 percent of its dealers,” Bellavia said. “It really wasn’t Chrysler’s decision. They are under enormous pressure from the President’s automotive task force.”

We have sent an email to John Isgett, President of Raceway Automotive, whose auto dealerships have been given a closure notice by both Chrysler and GM. If Mr. Isgett can shed some more light on this issue, we’ll be sure to share it with you.

Since small business owners tend to vote Republican for entrepreneurial purposes, you could argue that the majority of all dealership owners contribute to the GOP (if they contribute at all). Even HotAir.com says this would be “politically suicidal, for no benefit greater than petty revenge.”

There may or may not be anything to this issue, but you can bet we’ll let you know either way.

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8 Responses to “Update1 Did Political Contributions Influence the Chrysler Closings?”

  1. Reaganite Republican Resistance Says: May 28th, 2009 at 3:27 pm

    Obama thinks he’s Tony Soprano now- strong-arming legitimate, legal rights and claims from hedge funds… mafia-style, including union death-threats… so he could hand 55% of Chrysler over to the UAW, who donated $5M to his campaign.

    If that’s not stealing, I don’t know what is… it doesn’t matter how much you dislike hedge funds.

    Now he’s destroying the evil capitalists that didn’t support his fraudulent, disingenuous campaign?

    The White House says there’s “no evidence”- note that Hitler was careful to only give verbal orders, too… and Obama’s not new to this sort of thing.

    Obama’s completely out-of-control. But what did anyone expect with a neutered press, compliant congress, and cabinet full of sycophants?

  2. Tim Manni Says: May 28th, 2009 at 3:57 pm

    Reaganite,

    So you believe Obama had a direct say in who stayed and who went in terms of the Chrysler dealerships? If these reports are true it would be political suicide for the administration, I hope they’re not that dumb. Don’t forget Chrysler is in bankruptcy, and downsizing was necessary. The company hasn’t had any business success in years.

    I don’t think even these alleged claims of favoritism garner a comparison to Hitler, that’s insulting to a lot of people. We should save the torches and pitchforks until we find out the truth.

    Thanks for you comment,
    Tim

  3. Jeanne Says: May 28th, 2009 at 8:40 pm

    Red state, Texas, to be hardest hit with Chrysler closings

    I don’t know how to find political donation records to crossmatch, but Texas’ activity needs to be researched by someone who does.

    http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/051509dnbuschryslerdealers.10e32a4.html

    EXCERPTS:

    May 14, 2009

    Chrysler is planning to shut down more dealerships in Texas than in any other state – 50 of the 789 dealerships targeted for closure are in Texas.

    • El Dorado Chrysler-Jeep in McKinney
    • Frank Kent Dodge in Fort Worth
    • Grubbs Chrysler-Jeep in Bedford
    • Huffines Chrysler-Jeep in Denton
    • McNatt Dodge in Denton
    • Manuel Dodge in Richardson
    • Tommy Manuel Chrysler-Jeep in Arlington
    • Preston Chrysler-Jeep in Dallas

    Chrysler dealerships aren’t the only ones scheduled to get bad news this week. General Motors Corp. says it is notifying 1,100 dealers that it will not renew their franchise agreements when they expire at the end of September of 2010.

  4. Tim Manni Says: May 29th, 2009 at 11:17 am

    Hey Jeanne,

    Your right, Chrysler dealerships aren’t alone — GM is close behind. Luckily for GM dealership owners, they have a little while longer to prepare. I have no doubts that the sheer size of the state has a lot to do with Texas experiencing the most closings.

    Do you have an opinion on whether or not the Obama administration directly influenced each closing by who donated politically?

    Great hearing from, thanks for your comment,
    Tim

  5. ron barham Says: May 31st, 2009 at 1:49 am

    I think the real story is why close them at all? I seen the interview on Fox and the dealers are saying hey we need more dealers, not less! Besides, i do not see how taking jobs out of the economy when franchise owners want their business’ makes sense????????? I mean if a guy is putting up the money to run the car lot and employ people why are they closing them down? Ofcourse they are struggling to stay a float, we all are! But they where closing down a guy that had never had a layoff since 1956! He said that he intended on keeping his people employed until he went broke! and the government with tax payer money, via gm/chrysler figure heads says no sir shut em done! It’s wrong, unethical, unamerican, and now hard working americans are being told gm/chrysler cant fail “government bailout” but we wont even give your franchise the opportunity to fight for survival, we are closing you down! And this guy was a leading seller! Check foxnews.com Greta Vansustren ran the story, see what this hard working business owner had to say! It is appauling and America should be standing by this mans side!

  6. ron barham Says: May 31st, 2009 at 2:00 am

    Opinion on if Obama was involved? I don’t like thinking my president would do that! I am no Obama supporter, but before i beleive such thing i want hard facts. I do know that he has some infuence and he needs to help dealers and Americans stay working, period!

  7. Tim Manni Says: June 1st, 2009 at 11:43 am

    Ron,

    Thanks for commenting, it’s good to hear from some new voices.

    I’m just speaking from what I’ve read and heard, and I haven’t seen that Fox News story yet, but there seemed to be a formula Chrysler and GM followed for selecting these dealers. The companies did say dealers had the opportunity to appeal their closings, and for this dealer’s sake, I hope his numbers prove the company wrong — it sounds like this dealer has a viable business.

    In terms of job loss, the stale argument is that there would have been far more unemployed Americans if the companies were allowed to fail. That’s still a hollow assurance to the man or woman who just received a closure letter.

    Hope to hear from you again,
    Tim

  8. Tim Manni Says: June 1st, 2009 at 11:48 am

    Ron,

    I think your right. A president’s main goal is to preserve the well being of his people. Even those that didn’t vote for, and don’t support Mr. Obama, I hope, feel that he has our best interest in mind — and this would certainly not be the way to do that.

    “…before i believe such thing i want hard facts.” — I think that’s the best way to approach these claims.

    Thanks for commenting,
    Tim

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