Bush wants $25B in loans released to carmakers

Was going to post this in another thread but didn't want it getting lost in the negativity.



By JULIE HIRSCHFELD DAVIS, Associated Press Writer Julie Hirschfeld Davis, Associated Press Writer – 52 mins ago

WASHINGTON – The White House on Friday threw its support behind a plan to speed release of $25 billion in existing loans to the Big Three automakers but rejected a Democratic proposal to use money from a financial bailout to help the troubled industry.

The $700 billion financial rescue package was never intended to help automakers and shouldn't be now, White House spokeswoman Dana Perino told The Associated Press. But since Democratic leaders in Congress are pressing forward with a proposal to carve out a piece of its for the auto industry, she said the White House has decided to pursue a different approach: accelerating the availability of federal loans Congress first approved in September.

Those loans were approved to help automakers build more fuel-efficient vehicles and become more competitive companies in the global marketplace. The administration now supports allowing the loans to be released more quickly than the original legislation prescribed and to be used for more urgent purposes as the companies struggle to stay afloat.

"Democrats are choosing a path that would only lead to partisan gridlock," she said. "We are now actively calling on Congress to amend the loan program."

Good news....I am happy to read this...let's hope it goes thru...

Glad to see that this might at least clear up the false notion, which is rampant, that the car companies already got the $25 billion retool for alternative fuels vehicle money and blew it already.

I'ts about time. I was afraid that current administration was so stubborn to have it their way, they were going to sit on it until Obama gets into office and does it anyway.

So, now this, combined with whatever additional plan Obama may implement means very, very good news for GM.

Just a reminder, everyone... talk about the plan, the potential outcomes, etc., but leave the politicians and parties (and your opinions thereof) out.

:)

Just a reminder, everyone... talk about the plan, the potential outcomes, etc., but leave the politicians and parties (and your opinions thereof) out.

:)

Does that somehow include leaving out the UAW?

I don't think individuals should be taxed to give money to companies...whether it's a bank or a car company.

I also don't think that an additional 3 years is going to make a difference when they had 20 to come up with a plan.

I'ts about time. I was afraid that current administration was so stubborn to have it their way, they were going to sit on it until Obama gets into office and does it anyway.

So, now this, combined with whatever additional plan Obama may implement means very, very good news for GM.


Reminder...

This is not the loan being requested. It is the monies to retool and pursue fuel effiecient vehicle production.

This is not the survival loan at all.

Does that somehow include leaving out the UAW?

Yes.

I don't think individuals should be taxed to give money to companies...whether it's a bank or a car company.

I also don't think that an additional 3 years is going to make a difference when they had 20 to come up with a plan.

I agree.

Problem is they have become such a part of the economy we'd be more indebt and it would be far more costly (and I do mean, ALOT more costly) to the US taxpayer simply let them crash.

The important thing is to return GM to solvancy and profitability. Even if we have to send everybody in upper management packing in the process.

The part that bugs me about the whole situation is that the credit crisis was caused by Wall Street, meaning they are at least partly responsible for the mess that G.M. is in right now. If people with average credit could actually buy a car right now things would not be as bad. They managed to accelerate the decline of G.M. to the point where they are no longer able to turn things around on their own. For the government to turn their backs on them now is unbelievable.

Yes.
The important thing is to return GM to solvancy and profitability.

Until when? The next time they're not competitive and running out of money?

I hear what you're saying about the number of employees and the effect on the economy, but it's going to happen sooner or later...because they just can't think long-term and strategically. They have a proven track record of not being able to compete.

If that weren't true, they'd be able to get money from the private sector. But they can't, because nobody wants to invest in them now. So I am forced to? How does that work? We look down our noses for France and China doing things like this, but it's fine when we do it?

I hate to say it, because these companies are near and dear to my heart, but I'd rather keep my tax dollars and let them fail. That's the american way.

Part of the problem might also be the loss of millions of potential sales from lost good paying manufacturing jobs. Here in Ohio it's cost many bankruptcies, and foreclosures, snowballing for years.

I'll have to postpone my dream of driving a New Camaro, b/c my layoff looks pretty permanent this time, and retraining will take me a little while.

On one side, I don't feel sorry for companies in this position who are partially responsible. On the other, as Guy said, we simply cannot afford the losses that would result from GM going under.

On one side, I don't feel sorry for companies in this position who are partially responsible. On the other, as Guy said, we simply cannot afford the losses that would result from GM going under.

One could just as easily say that we "cannot" afford to do this. Where the country is already in massive debt and each additional dollar spent is borrowed from Asia...there is not an endless supply of dollars out there.

Then I have to wonder...if the country "cannot" afford for these companies to go out of business, then how long are we willing to finance them? 3 years? 10 years? If they're still failing 20 years from now, are we going to continue to force the taxpayers to finance their bad business plans?

If they are going to go out of business at some point, I would rather they do it before we waste $25bil. If you took $25bil and divided it across the total number of people who would be unemployed...it's a lot of money. Enough for each person to find new work, get training for a new job, etc. $25bil to a failed company could be just throwing money away.

Does that somehow include leaving out the UAW?
Yes.

Actually, no, I don't think so. Stay away from union-bashing in general, but the UAW is not out of bounds.

:mad:Sad it is to be said, if these 3 big manu. were successful, they would have not been creamed financially thus far. They are greedy and did cashed in on the SUV boom a couple years ago. When it comes to loans and of the sort, GM and the dealers have their own financial institutions.

Just think, you can be taxed more to save these institutions at regaining ground and prosper in the future, but who will be there to save you whence while standing on the unemployment line collecting a couple bucks that would not even get you through the month.

With these 3 big names falling, a pyramid of jobless claims with ensue... but just think, many have already lost employment so far.

Another thing to think about is: The Asian Vehicle manufactures operating in the United States is not requesting a Bailout? I wonder why? You think they will get a bailout if they asked? Do you think Congress would opt to assist them since they employed Americans?

It does boil down to intelligent companies and proper managements, resulting in capitalism.

:mad:

It does boil down to intelligent companies and proper managements, resulting in capitalism.

I can only offer that the greatest management of capitalism results in a monopoly. That is certainly the air-tight assurance of survival and return for the investor.

Wisely we have instituted some discouragement of that "paradigm". Let's at least consider that capitalism best benefits when it benefits more than it damages. You will find no greater proponent of captialism than me. There is nothing bad with getting a return for risk.

When you get into a world economy things may get a bit skewed. A paltry dollar in one frame of context is a month's wages in another.

I again point out, what makes dependance on foreign oil so intolerable and thus counter to all we hold dear, as opposed to dependance on foreign labor being so readily viewed as the natural order of things?

I just don't accept that the American ideal is foundationally based on clay feet.

Hell, at the loan amounts they're talking about, the gov't could just buy GM and Ford at market value and be done with it.

At current stock prices, it would only cost something like $6 billion to buy them. If we're going to dump tax dollars down the rabbit hole, then we may as well do it directly instead of through loans. If we're gonna be subisidizing people's jobs, just go ahead and buy the companies and add them to the federal payroll. Our gov't can mismanage and lose money building cars just like they mismanage and lose money carrying letters and running trains....

Because honestly, between the 2 companies, they have ~$200 billion in debt, if $200 billion in debt couldn't get them right, WTF exactly is another $25 billion ,$100 billion or even trillion gonna do except prolong the agony. Its kinda like giving a drunk a drink at this point...

Hell, at the loan amounts they're talking about, the gov't could just buy GM and Ford at market value and be done with it.

At current stock prices, it would only cost something like $6 billion to buy them. If we're going to dump tax dollars down the rabbit hole, then we may as well do it directly instead of through loans. If we're gonna be subisidizing people's jobs, just go ahead and buy the companies and add them to the federal payroll. Our gov't can mismanage and lose money building cars just like they mismanage and lose money carrying letters and running trains....

Because honestly, between the 2 companies, they have ~$200 billion in debt, if $200 billion in debt couldn't get them right, WTF exactly is another $25 billion ,$100 billion or even trillion gonna do except prolong the agony. Its kinda like giving a drunk a drink at this point...

You hit the nail right on the head and drove it home. Consider one thing though- just my opinion- you can't have the government owning businesses. First off, they themselves don't run like one, so the business model is poor at best. Secondly, imagine the government running it and deciding how much of our tax money at any given time is going to be thrown at it to keep it afloat. There are no checks and balances to stop the government from writing a blank check once they are in control of it. That's a recipe for disaster IMO.

You hit the nail right on the head and drove it home. Consider one thing though- just my opinion- you can't have the government owning businesses. First off, they themselves don't run like one, so the business model is poor at best. Secondly, imagine the government running it and deciding how much of our tax money at any given time is going to be thrown at it to keep it afloat. There are no checks and balances to stop the government from writing a blank check once they are in control of it. That's a recipe for disaster IMO.

I didn't make it quite clear so don't get me wrong, I'm not arguing for a gov't takeover of GM/Ford/Chrysler, quite the opposite actually. I don't like the idea of any interference whatsoever. Interfering is going to do nothing but maintain the status quo which isn't working too great for anybody involved...

At this point, loans are not going to fix GM, Ford and Chrysler. If anything is going to fix them, its going to be Ch 11...

When it comes to large corporations like GM etc........ Capitalism is still the main focus...... for the high ranking Executives that is. They benefit and bank roll a high paying salary and jump ship when it sinks. Share holders in turn foot the bill as of recent.

History has shown time and time again Execs steps down first when companies fall.

Shameful at time is Corporate America.

Greed from financial corporations and Manufactures has led us to where we are today in the U.S.

I can only offer that the greatest management of capitalism results in a monopoly. That is certainly the air-tight assurance of survival and return for the investor.

I just don't accept that the American ideal is foundationally based on clay feet.

The FDIC does take over financial institution and resell them when bankruptcy occurs.

The gov should take over GM and resell it to the Japanese! I guarantee they will make rear wheel driver better!


I didn't make it quite clear so don't get me wrong, I'm not arguing for a gov't takeover of GM/Ford/Chrysler, quite the

At this point, loans are not going to fix GM, Ford and Chrysler. If anything is going to fix them, its going to be Ch 11...

:cry:ALBANY, N.Y. (AP) -- New York Attorney General Andrew Cuomo says Citigroup executives should forgo their bonuses this year after the company announced massive layoffs.

Calling the layoffs of 53,000 people "disturbing," Cuomo says top executives shouldn't get bonuses while investors, taxpayers and employees suffer.

Cuomo adds that other companies should consider doing the same, including American International Group, which has received billions of federal bailout dollars.

In October, Cuomo's office asked nine banks to turn over information on bonuses. He wants to ensure none of the $125 billion the banks received from the government's Troubled Asset Relief Program will be used on executive pay.

Goldman Sachs Group announced Sunday its top executives won't get bonuses this year.

I can only offer that the greatest management of capitalism results in a monopoly. That is certainly the air-tight assurance of survival and return for the investor.

I kind of disagree... Yes, if you were the only company in the marketplace, you would take advantage of your monopoly. But a monopoly is not the natural conclusion.

This is capitalism at work...when the U.S. companies made junk, the Japanese companies entered the market...and now they make better products. And now the Japanese control the marketplace. This is capitalism at work. Because of capitalism, there is no monopoly...and the weak will not survive. Unless their bad performance is subsidized by the government.

I can't even believe we're having this conversation. When Airbus competes against Boeing, everybody always cries about how Airbus is funded by the government and Boeing isn't...and how capitalism should be allowed to work, rather than socialism. And now...what? If I wanted to put my money into GM, I would buy GM stock. I shouldn't be forced to.

And, I say this as a Camaro afficionado, who wants an SS (or better yet - an LS7)...IF I were to invest money into a car company right now, it would not be in a company making a 400Hp V8 sports car.

Congressman do listen to the people... you better believe it!!!! As of right now, they are not permitting the bucks to pass.


Just imagine, if the House passes the bailout for the BiG Manu, all of us will be paying until we die in tax dollars for companies we don't own or a vehicle lease that we will never have.




I kind of disagree... Yes, if you were the only company in the marketplace, you would take advantage of your monopoly. But a monopoly is not the natural conclusion.


And, I say this as a Camaro afficionado, who wants an SS (or better yet - an LS7)...IF I were to invest money into a car company right now, it would not be in a company making a 400Hp V8 sports car.

In my next life I want to be a UAW worker.
Heard the compensation comes out to about $70/hr..

Now I'm trying to be on a strict "made in USA" way of life, but they make it pretty hard and I'm not for handouts in those circumstances.

In my next life I want to be a UAW worker.
Heard the compensation comes out to about $70/hr..

Now I'm trying to be on a strict "made in USA" way of life, but they make it pretty hard and I'm not for handouts in those circumstances.

Ya, something like that...

http://i185.photobucket.com/albums/x124/trm0002/wm2135_chart1.gif