May 2009 Archives
In one of America's largest ever bankruptcies, GM is expected to declare itself bankrupt tomorrow, in an attempt to seek protection from creditors after stacking up over $80bn of losses in the last 4 years.
The firm has also swallowed some $20 billion in cash from the Obama administration and is likely to need another $30 billion before emerging from Chapter 11 substantially slimmed down, and free of debts. During Chapter 11, the firm will continue to function and assemble cars, and a judge will make the decisions on who gets what assets.
Whilst the old saying that 'whatever's good for GM is good for the US economy' may no longer be true (if it ever was) and GM is no longer the biggest car maker in the world, by some estimates it still accounts for 1% of the US economy. The bankruptcy then is not only hugely symbolic of the fate of the US car industry, but matters profoundly for the workers, suppliers, dealers and creditors caught up in its travails.
Unless you are a practising lawyer (or rather a practising lawyer who takes a keen interest in the identity of our senior judiciary), the answer may well be no. But, if you're interested, he's a very distinguished and successful commercial lawyer who has just been promoted to the Judicial Committee of the House of Lords, the most important and powerful court in the UK (and, as it happens, for a number of Commonwealth countries as well).
This is actually quite important. Lord Collins has become one of the 12 most influential judges in the land, with the ability to make significant changes to the laws which govern your life. He is also the first solicitor to be appointed to the Judicial Committee and has enjoyed an incredibly successful and distinguished legal career combining academic brilliance (he edits the leading textbook on the conflict of laws - the complicated legal area governing the applicable principles when disputes involve both the law of England and Wales and that of another country) and commercial success, as this biography on Wikipedia suggests. I imagine that most interested commentators would consider his new role to be a thoroughly merited and deserved appointment.
Contrast this lack of fanfare regarding Lord Collins's appointment with the coverage in the American media of President Obama's decision to nominate Sonia Sotomayor to the US Supreme Court. Having spent five or so minutes on this web page of one of the main US broadcasters (picked entirely by random, other American news networks are available) and, in addition to Ms Sotomayor's academic and legal background, I know that she was born and raised in the South Bronx in a tough housing project, is inspired by her nurse mother (who raised her and her brother, now a doctor, single-handedly after their father's premature death) and her favourite baseball team is the New York Yankees.
I also know that her background is mainly in commercial law (as is Lord Collins's), which commentators consider may mean that the Republicans will struggle to challenge her appointment, although there is concern as to whether a recent ruling on affirmative action (which is itself about to be considered by the Supreme Court) is correct. There is also much debate as to whether the possible appointment of the first Hispanic to the Court is a great day in American history, or whether the Democrats making this point are conveniently forgetting when they blocked an earlier (and Republican) Hispanic appointee. The identity of senior judges matters in the US in a way that just doesn't happen on this side of the Pond.
I have always found the contrast between how the UK and the US appoint its judiciary fascinating. I know it's fashionable for Brits to knock America as being litigation crazy. But, behind every headline about people suing McDonald's because they didn't realise that the coffee was hot (although this story would appear itself to be an urban myth), there is one of the most advanced and democratic legal systems in the world. We don't have to copy America, but I can't help but wish that we took a bit more interest in who is appointed to judge over our lives.
LDV is back in court tomorrow hoping to withdraw its application for administration. After a last-gasp ÃÂ£5million intervention by the government (well done, Liam Byrne) to buy critical time for the Malaysian firm Weststar to look over LDV's books and hopefully buy the firm, hopes are rising that production will re-start this summer once the takeover is completed.
Readers won't need reminding that the van maker ceased production back in December after the double whammy of recession and credit crunch hit the commercial vehicle market, and LDV's Russian owner Gaz ran into its own financial troubles.
Critically, Weststar appears to want to maintain production at LDV's Washwood Heath plant, and also to expand manufacturing in Malaysia (where so far Weststar has imported Maxus van components and assembled them for Asian markets).
LDV employs around 850 workers at its plant, with another 1200 in dealerships. Several thousand more in the supply chain depend on the firm, although it isn't clear how many of these have already lost their jobs in the savage downturn affecting the industry and given that LDV hasn't made a van in months.
Tomorrow thousands of workers are expected to join a march in Birmingham to send a clear message to the government that protecting jobs must be the top priority as the double whammy of recession and credit crunch continues to bite.
The "Unite for Jobs" march will bring together key figures from business, academia and politics to spell out the case for government action to protect jobs, especially in the manufacturing sector.
I didn't think I'd ever see the former CBI chief and trade minister Digby, Lord Jones of Birmingham marching alongside the joint general secretaries of Unite, Tony Woodley and Derek Simpson. Yet there they will be, at the head of the march, spelling out the need for government action.
I'll be going along as I think Digby, Tony, Derek and many others have a very strong case to make. In recent blogs I've been stressing the need to support not only JLR and the auto sector, but also manufacturing more generally.
There are very good reasons for doing so, as one day (we don't know when) this recession will be over, and we will need a strong manufacturing exports sector to drive growth. Financial services, consumers, property and construction will recover but they won't quite drive growth in the way that they did before. Manufacturing will matter.
Assuming that you read the same papers and watch the same telly as me, then, amid all of the headlines surrounding the frankly scandalous abuse of the expenses system by our MPs and Dundee United's drive towards third place in the Scottish Premiership and European glory next season (a story that admittedly doesn't seem to being given its due prominence in the Post's sports' pages), you could have been forgiven for missing the current controversy surrounding the heir to the throne's views on the built environment.
This afternoon, Prince Charles is speaking to the Royal Institute of British Architects (RIBA to its chums) on the occasion of its 175th anniversary. The speech is almost 25-years-to-the-day since, when addressing RIBA's 150th anniversary, the prince famously described the proposed extension to the National Gallery as "a monstrous carbuncle"; in doing so, both scuppering the proposed scheme and incurring the seemingly never-ending-wrath of a chunk of Britain's architectural elite.
25 years later, and history is repeating itself. The latest controversy relates to the design for the proposed development of the Chelsea Barracks site in London by (Lord) Richard Rogers, the incredibly eminent and distinguished architect behind the Pompidou Centre, Lloyds' of London and the Millennium Dome amongst other buildings. The Prince disagrees with the steel and glass design proposed and has commissioned a separate architect, Quinlan Terry, to produce a design more "in keeping" with the area - including the neighbouring Royal Hospital designed by Sir Christopher Wren.
Within the construction industry, the debate has been wide-ranging (with a leading trade magazine conducting a poll - which Prince Charles's preferred design won) but has increasingly become vitriolic, with leading architects publishing a letter of objection and urging a boycott of the speech. The main criticism is that the success or failure of the Rogers' design will depend on the normal planning laws of the land - which should apply equally to all buildings - and that it is unfair for Prince Charles to use his high profile to scupper the plan.
On the other hand, the degree of vitriol seems harsh and unfair. The built environment affects us all - and I would hope that all architects (distinguished and otherwise) would want to design buildings in which we all want to work, rest and play. I find the suggestion that a small intellectual elite should impose their views on us without comment or criticism very hard to take. Perhaps this is an example of the architecture profession protesting too much?
Some great news potentially - at last - for LDV. The government has finally supported a last-ditch takeover of LDV by Malaysian firm Westar with a ÃÂ£5m bridging loan that will buy an extra month to hammer out a deal.
That deal is not yet completed, but the news keeps LDV in the game and offers hope that it can indeed pull off yet another famous recovery.
The loan, from the Department for Business, Enterprise and Regulatory Reform (BERR), will - it's hoped - prevent the Brummie van maker from sinking into administration and keep the firm going whilst the deal is sorted out.
Whilst it isn't clear whether Westar, a Malaysian vehicle importer with whom LDV have long-term ties, has guaranteed that production will remain in Britain, it is doubtful whether the British government would be lending the money if UK production wasn't on offer.
Westar is probably the only hope to keep LDV going in Birmingham. If LDV had been forced into administration tomorrow, the most likely outcome would be another lift-and-shift of LDV assets and knowledge out to the Far East as we saw so painfully with MG Rover four years ago.