UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

June 18, 2009

OBAMA IN TROUBLE WITH RURAL DEMOCRATS OVER CAR DEALERS

Politico - Angered by White House decisions on everything from greenhouse gases to car dealerships, congressional Democrats from rural districts are threatening to revolt against parts of President Barack Obama's ambitious first-year agenda.

"They don't get rural America," said Rep. Dennis Cardoza, a Democrat who represents California's agriculture-rich Central Valley. "They form their views of the world in large cities." . . .

The conflict with rural Democrats burst into the open at the Capitol last week, when rural and moderate Democrats revolted against the decision to close roughly 3,400 General Motors and Chrysler car dealerships. The White House Auto Task Force endorsed some of the cuts in its plans to revamp the companies.

In rural America, especially, the looming closures pose a dire threat. Car dealers are not only an economic linchpin of many county-seat towns but also offer support for institutions and a way of life that can't be easily replaced.

"In rural jurisdictions, your dealerships are pretty big employers. If you knock out four dealerships, the ripple effects of that are substantial," said Rep. Frank Kratovil (D-Md.), who represents a largely rural Eastern Shore district and is co-sponsoring a bill that could force the auto companies to honor their contracts with the rejected dealerships. . .

Sen. Kay Hagan (D-N.C.) questioned how independent owned and operated businesses have any financial impact on automakers.

"None of us can quite understand why they consider dealerships a drag when they are the ones that buy the cars, that take the financial risks. Many of the dealerships that are being closed are profitable."

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