Wednesday, May 27, 2009 5:04 PM
By: Kenneth R. Timmerman
Increasing numbers of Chrysler dealers are disputing the bankrupt automaker’s claim that it selected dealerships for closure on purely economic grounds, and they have filed a suit against the automaker in U.S. bankruptcy court.
"My business is being stolen from me under the guise of the bankruptcy laws [and] given to another dealer down the street," Jim Anderer, owner of Island Jeep in Lindenhurst, N.Y., told Reuters.
Like many of the 789 Chrysler dealerships slated for closure, Anderer claims his retail outlet was
profitable. Many of the closed dealers were also major donors to Republican candidates and political action committees, a review of campaign finance data from the Federal Election Commission shows.
This has led to accusations, which Rush Limbaugh aired last week, that President Obama's auto task force has been playing political favorites, first by forcing Chrysler into bankruptcy, and then by targeting dealerships for closure that funded the president’s political enemies.
An attorney representing some of the dealers, Leonard Bellavia, came close to supporting those
allegations himself after deposing Chrysler President Jim Press on Tuesday. “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."
Among the most prominent Republicans who stands to lose his business as a result of the Chrysler bankruptcy is Vernon G. Buchanan, owner of Venice Dodge in Venice, Fla.
Buchanan gave $2,300 to John McCain in last year’s election, and has given a whopping $5.3 million to Republicans since the 2000 election cycle, according to FEC records Newsmax examined. He spent nearly $4.5 million of that amount to get himself elected to Congress in 2006 in the 13th District of Florida, where incumbent Republican Katherine Harris resigned that year to run unsuccessfully for U.S. Senate.
Buchanan won the 2006 election with just 50 percent of the vote but came back in 2008 and won a more comfortable victory with 56 percent of the vote, and voted against Obama’s budget this year. But he has crossed aisles occasionally, notably voting in favor of an expansion of the State Children's Health Insurance Program that President Bush vetoed in 2007.
Other prominent Republican donors whose successful Chrysler dealerships will be shut down include Russ Darrow, owner of Darrow Chrysler Jeep of Menomenee Falls, Wis. Darrow spent $2.7 million of his own money to finance an unsuccessful challenge to incumbent Democratic Sen. Russell Feingold of Wisconsin in 2004.
Many dealers, however, gave to both political parties; some, such as Alan Spitzer, owner of Spitzer Dodge in Elyria, Ohio, gave only to Democrats.
Blogger Doug Ross (Directorblue.blogspot.com) has begun posting lists of Republican donors whose Chrysler dealerships have been targeted for closure. The most complete list of Republican victims of the Chrysler bankruptcy was compiled by an anonymous blogger at scribd.com/doc/15760333/Chrysler-Report, which identified 165 Republican donors out of 595 examined, or just over 27.7 percent.
One blogger, who claimed to work for one of the soon-to-be closed dealerships, reported on the blog Cars.com that his dealership was “in the top 125 out of the 3,500 dealerships nationwide . . . yet we are on the list. We are not small nor are we rural. We are in a large major metropolitan area. Our new vehicle inventory alone is well over $4 million.”
In addition, “Chrysler is already 'shopping' for dealers to take over the open 'points' (another name for franchise) left by closed dealership,” he added. “This is so much more than 'just business.' This is about control and power by our present administration in Washington.”
Auto-dealers as an industry tend to give more to Republican causes than to Democrats, according to an analysis done by Center for Responsive Politics, a nonprofit organization that compiles FEC data and operates the Open Secrets Web site.
During the 2008 election cycle, the center found that auto dealers and their associated political action committees made a total of $9 million in campaign contributions, giving by a 3-to-1 margin to Republicans. The automobile industry as a whole made $18.5 million in donations in 2008, also breaking roughly 3-to-1 in favor of Republican candidates and causes. But it ranked way behind lawyers, civil servants, hedge fund managers, teacher’s unions, and the entertainment industry, which were large Democrat donors.
One company that stands to benefit in a major way from the Chrysler restructuring is called RLJMcLarty-Landers, a start-up owned by Democratic Party insiders that operates six Chrysler dealerships throughout the South. Co-owners Robert L. Johnson, founder of Black Entertainment Television, and Mack McLarty, chief of staff to president Bill Clinton, provided capital and political clout to the partnership, which they formed in September 2007.
Johnson is a major donor to Democrat party causes but sharply criticized Obama during the primaries for his admitted drug use as a young man. He later apologized to Obama for the personal attack.
According to another blog, RLJ-McCarty-Landers will retain all of its six dealerships, while “eight competing dealerships [will be] totally eliminated from three of their markets.”
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