One quality that Americans have always possessed is called "good old common sense".  Our mothers constantly reminded us to use our "common sense".  That is the one thing that will save America from the sophisticated schemes that some countries have for "doing in the American automobile industry".  Let's examine the acts which are harming the American auto industry financially with the use of American money to finance foreign automobile companies. 

That combined with the questionable actions of the some of foreign auto companies should be a subject of hearings in Congress.  The National Security of the country is at stake and the American people should know the credentials of the companies in dealing with American laws.  It is also a matter of safety. 

Nissan has been leading the charge for the Japanese car companies, Toyota and Honda by being first in line for handouts for American tax money to keep Nissan running or for us to pay for the research for their auto technology so they can compete against General Motors.  Nissan was first in line for the Federal Reserve Talf Funds ($1.5 billion), and for Clean Fuel Funding from the Department of Energy ($1.5 billion), and for HUD funds (2/3rds of the funds for state of Mississippi for two years) and for $4.9 billion for the Canton, MS auto plant with all the tax abatements from the taxpayers of MS plus the federal funding the State could snag for Nissan.

This was not Nissan but it was Cerberus, which owned 80 percent of Chrysler and bought GMAC the financial arm of General Motors stashing GMAC in Tokyo with Aozora Bank  (formerly, nationalized Nippon Credit Bank) which invested $500 million in GMAC and lost $150 million.  Cerberus owned 37 percent of the bank and later owned 45 percent of the bank after the Japanese government became upset with them because of the loss of the $150 million. 

By that time, Aozora Bank had incorporated new financial organizations in the U.S. with GMAC through the State of Delaware.  This former financial arm of GM financed housing and other entities in addition to GM's auto business.  The purchase of the 100-year-old GMAC gave the Japanese a fountain of information from around the world. 

GMAC had been financing entities and ventures around the world since it was first incorporated.  GMAC had applied to become a bank holding company but with the bankruptcy quickly became something for Cerberus and others as a banking entity.

This organization was essentially lost for American purposes when the bank was set up.  Originally Cerberus had agreed that GM could buy back GMAC within a certain period of time.  Events quickly over shadowed that promised.  By the time GMAC became a bank GM had only 10% of the entity though before the bankruptcy had owned 49 percent of the company.  Cerberus still holds a position on the Board of GMAC.

GMAC is one issue.  Another issue is the financing of the suppliers for Nissan in Mississippi or any other state where they are operating.  Many foreign suppliers have come in to supply these foreign automakers.

Another issue is Nissan which always is mentioned in car conversations because of the company altering odometers on over 50 vehicles, changing their MSO's (Manufacturer Statement of Origin, Title) so there was no history of ownership and the cars would appear new.  This consists of a securities violation and other issues under federal law which needs to be examined before Congress.  Too many federal laws have been violated and may have to be strengthened.  Transportation and automobile laws are extremely important to the United States not only because of the industry but also because of the size of the industry.  Talking about car titles you are referring to property law. 

Another issue was mentioned by Barron's Magazine in the 1980's that there were Japanese banks coming into the United States and very quietly buying up second-tier-and-third-tier suppliers for the Japanese auto industry. The purchase of these suppliers was allowing the Japanese to slowly move the supply industry to the south, establishing what appears to be a national security corridor complete with Krupps steel plant in Alabama and a free port for importing and exporting cars. 

These industries also draw in citizens from Japan.  Ohio, according to the "Car Connection and the Japan's consul general in Detroit " has 6,000 Japanese citizens and Michigan 9,000 Japanese citizens living in the state because of the industry.  Japanese affiliated companies employ roughly 64,000 people in Ohio and 70 percent of the companies are involved in manufacturing.

Another issue which is never discussed and is not well known within government is the U.S.-Japan Partnership For Growth, which originated under the Clinton Administration and was expanded by President Bush in June 2001.  The sub cabinet organization is chaired by the National Security Council/National Economic Council for the U.S. and the Ministry of Foreign Affairs (MOFA) for Japan.  (One paper has added METIE for Japan)   The organization operates at the sub-cabinet level with a yearly report to the Prime Minister of Japan and one to the President of the United States. 

Sectoral Working Groups have access within the Justice, Treasury, Commerce, State, Energy and USTR, the issues that are considered are corporate restructuring, telecommunications, medical devices and pharmaceuticals, nutritional supplements, information technologies (leading to greater use of email and the internet), energy, they did patents, de-regulation of financials, competition policy, transparency, legal reform, commercial code issues, distribution, customs, clearance procedures, business facilitation and other issues of concern to the two countries. They moved the housing initiative to another forum.  Remember that the Japanese owned 75 percent of the securities in Fannie Mae.

The problem with the arrangement is at the policy level.  There is also an auto group at the Commerce Department in which the U.S. shares all intelligence gathered world wide on the auto industry with the Japanese.  The organization is called the U.S.-Japan Auto Group.  In the past this organization would have operated out of the State Department according to a former executive who played a prominent role at the National Security Council.

Since the American automobile industry has one third billion registered cars and vehicle in the U.S. today, this is a considerably sizeable market.  It has had an essential role in creating the U.S. economy and also being our National Defense Industry.  Anyone wanting to do in the industry has a prize of more than autos; they also cripple our ability for a national security for the country.  If we have a problem with security or internationally an event of a war, where would we turn for help without a strong auto industry? 

Since President Obama declared that only the American auto industry would sell to the military these foreign entities have been upset. The foreign automakers need to remember it is American taxpayers paying the bill, regardless of where the nation borrowed money. 

  The old expression to "rally around the flag" is appropriate here.  The President is right.  The economy, our middle class, our national security, many of the strengths of the U.S. came from the auto industry and the jobs it provided.   I repeat, "Rally around the flag our future is ours to keep or destroy".  We have been challenged by these foreign situations, but Americans have too much common sense to lose.  It is one of the strengths of America.

Mike Biras

mbiras64862@mypacks.net