GM and its impact on FIRST

[Andrew Schreiber]

Originally Posted by Mr. Pockets

Just thought of something. A large portion of GM will now be owned by the government (over 50% if I'm not wrong). If that's the case and GM continues to support FIRST (in whatever way it does) then technically wouldn't that mean that the federal government would be supporting FIRST? Yes? No? I don't know just a thought. Sorry for straying off topic.

<off topic rant and personal views, feel free to disregard>
Yes, you have hit the nail on the head to why I simply CANNOT purchase a GM manufactured car as long as the Federal Government owns a majority share in the company. These are deeply held beliefs in the way capitalism is supposed to work, to have a company owned by the government is something that I cannot support.* To purchase a GM car would go against many of my core beliefs should they emerge from Chapter 11 as a government owned company. I apologize if this offends any of you, it makes me sad, every GM car my family has had has served us well. When I got my first car 2 years ago I only looked at American cars and GM was number one on my list, I ended up with a Saturn, a Saturn I enjoy driving. I don't dislike GM, Ive never had anything but wonderful experiences with them. I will consider Ford for my next car purchase because I consider them the last American car company.
</rant>

While I do greatly appreciate the support from GM I personally believe that GM support for FIRST should have been among the first things shed in order to help preserve jobs. I would rather see a dozen FRC teams fail than to see one American job lost. Of course I understand that even 100 teams with $20,000 budgets would have been a drop in the bucket compared to the losses GM was taking. However, understand that often perception is more important than reality, imagine the response of a GM worker when he just got told he couldn't come in to work for the next week because it was too expensive to pay him when he sees a dozen kids using GM owned equipment to build what is essentially (to him) a glorified remote control toy. If I had to worry about how I was going to feed myself or my family so some kids can play with their toys I would be pretty ticked off. We have to be careful about what we ask for, teams will need to cut back and trim the fat out of their teams. I expect this year will be one of the slowest growing years for FIRST, most of the growth that does occur will NOT be within the United States either. Many old GM powerhouse teams will be struggling this year because some of them will have to radically change how they do things. Many other teams will struggle because their primary sponsors are suppliers to GM, Delphi springs to mind as another major sponsor here. One downfall of our current system is that everything is linked into everything else, you would think that being a software programmer I couldn't be jeopardized by a failing in the manufacturing industry but I produce systems for GM suppliers. My point is GM is huge, this will affect our everyday lives for years to come.


Sorry for the novel, now if you will excuse me I am going to put on my safety glasses (Why does he not have a construction helmet on too?) and ride out the comments...

*There are exceptions, obviously some things are just logical to have government run (or at least controlled) Roads, Telecommunications, Utilities are a couple that come to mind.

[Mr. Pockets]

Originally Posted by Andrew Shrieber

Yes, you have hit the nail on the head to why I simply CANNOT purchase a GM manufactured car as long as the Federal Government owns a majority share in the company. These are deeply held beliefs in the way capitalism is supposed to work, to have a company owned by the government is something that I cannot support.* To purchase a GM car would go against many of my core beliefs should they emerge from Chapter 11 as a government owned company. I apologize if this offends any of you, it makes me sad, every GM car my family has had has served us well. When I got my first car 2 years ago I only looked at American cars and GM was number one on my list, I ended up with a Saturn, a Saturn I enjoy driving. I don't dislike GM, Ive never had anything but wonderful experiences with them. I will consider Ford for my next car purchase because I consider them the last American car company.

I don't like the idea of GM being government owned either, but my point was a little different. I was more commenting on the fact that for a long time we've been encouraged to make our elected officials aware of FIRST by say inviting them to a regional or whatnot. I was just musing about whether that will be accomplished through the government owning GM and GM supporting FIRST. Just a thought...

[Kyle]

Sponsors come and go, the real impact that FIRST will see is going to be the loss of amazing mentors as GM closes plants and offices that they work at. Many of those mentors are very dedicated to FIRST but they will have to think more about their families and finding work rather then spending time working with a FIRST team. Here is Delaware the GM plant is closing affecting over 500 jobs, I can't imagine what life is like in some of the towns where the GM plant was the life's blood of the town.

[Beth Sweet]

Speaking strictly from a financial standpoint, a company (such as GM) typically would get tax benefits by supporting a qualifying charity (such as a 501c3 like FIRST) to a monetary extent (it's been a year since I took tax, I don't remember off the top of my head, I'll look it up if you really want me to). To that extent, GM was able to pay fewer US tax dollars by supporting FIRST's charitable actions. Sorta like, giving them the option of doing the general good things the government wants to do, or picking which good thing they want to do. Additionally, the losses that GM has been taking for the last few years will "earn" them money in the coming years. If my memory serves me correctly, a current NOL (loss) can be applied to income as far as 20 years back, and they will receive back taxes for profitable years. (If a company hasn't been profitable in that period, or the losses outweigh past gains, it also carries forward, but I won't get into that)

Now, all of that given as truth, the bankruptcy, because of the extent of government involvement, may make some of those typical financial benefits of charitable support null. Typically (and the likely reason that Fiat bought Chrysler), a bankruptcy does not invalidate the ability to use these losses and charitable deductions, but with the billions in government aid, the media has been making it sound like this won't be your typical Ch 11 (and since they're on the conference calls, I'll trust them).

So, the point of that whole thing is: it has been in GM's best financial interest to support charities such as FIRST in the past, depending on government restrictions on charitable contributions, it may or may not be in the future