Filed under: Government/Legal, GM
White House up to addressing auto aid, extra $25 billion could come from bailout package
Word on the street is that President elect Barack Obama spent some time in the oval office yesterday with current President Bush talking about the auto industry, and the junior Senator from Illinois urged the President to address the automakers' dire situation post haste. The President seems to be on the same page, with word coming out of the White House that it would consider a congressional proposal to carve out $25 billion of the nation's $700 billion bailout plan just for the auto industry. That's in addition to the already approved $25 billion worth of low-interest loans to automakers, the distribution of which may also get sped up considerably. Those low-interest loans may even get restrictions lifted that were to ensure they be spent on green cars and retooling factories, but now may be used for anything the domestic automakers deem most prudent. Nothing's final until it goes though Congress and gets the President's approval, but it would seem the considerable squawking coming from General Motors for federal aid has reached the ears of those who may actually do something about it. Whether they should or not is still an open debate.[Source: Automotive News - sub. req'd, Jalopnik, Photo by JIM WATSON/AFP/Getty]
Reader Comments (Page 1 of 5)
Mike 12:42PM (11/11/2008)
Where is MY money?
Reply
Bungle 12:53PM (11/11/2008)
According to the article, it's about to go to the auto industry!
TJ 12:54PM (11/11/2008)
Welcome to the USSA! Your check is in the mail*.
*Legal Disclaimer: Government welfare and redistributionism is only for those making under $42,000/year and those do not responsibly invest. If you make more than $42,000/year we will increase your taxes, and if you invest we are doubling your capital gains taxes. Oh yeah, we are also going to steal your 401k's, make them taxable, and put that money in a 3% capped government insured bond; oh, yeah, contributions will also be mandatory. Corporations, do not make me laugh... your taxes are also going up. After all, Your success is vital to the success of all those who didn't work as hard as you.
Hanoi Jane 12:58PM (11/11/2008)
TJ, i've been using that USSA term for a while now, i demand royalties for stealing my material.
TJ 1:09PM (11/11/2008)
HJ: With what your name implies, we have different viewpoints as to whether the transition to USSA is a good thing or a bad thing....
tekd 1:30PM (11/11/2008)
Don't be silly Hanoi Jane, in the USSA your jokes are communal property. Don't make US sue YOU for trying to privatize jokes!
halogenrep 2:20PM (11/11/2008)
I like the USSA reference. Clever.
Domestic 6.0 2:24PM (11/11/2008)
What a great pic ... New vs Old
Say What? 2:35PM (11/11/2008)
"Where is MY money?"
Mike, you silly goose. Don't you know what's theirs is theirs.
And, unfortunately, what's ours is theirs too!
SimbaDogg 2:44PM (11/11/2008)
reminds me of don cheadle in oceans 13...
"pay me my money"
happy_penguin 3:20PM (11/11/2008)
You'll get your money when the people whose jobs are tied to the American auto industry continue to patronize the businesses you own and are employed by. You won't get your money if we all plunge into a depression when the massive ripple effects of failure are felt.
Big Rocket 5:19PM (11/11/2008)
@happy_penguin: Again with the doom and gloom prediction, about how America would suddenly plunge into a second Great Depression, or worse, if GM does not receive billions and billions in federal bailout (read: taxpayer's dollars), with no end in sight. Guess what, the job loss figures were fabricated by a firm with very close ties to the auto industry in general, and the Big 3 in particular. See the evidence for yourself below. Lobbyists are seldom known for accurate, unbiased information.
Washington Post: "The Center for Automotive Research said this morning that if ... GM, Ford and Chrysler ... fail, it will mean the loss of 3 million jobs across the entire auto sector in the first year of collapse. Should Detroit production drop by 50 percent ... some 2.5 million jobs would be lost, the report says."
http://voices.washingtonpost.com/economy-watch/2008/11/report_3m_jobs_lost_with_autom.html
Bloomberg: "A GM failure that stops production would cost 2.5 million jobs in the U.S. in the first year, according to the Ann Arbor, Michigan-based Center for Automotive Research."
http://www.bloomberg.com/apps/news?pid=20601087&sid=azOHgjt14vZ8&refer=home
The Ohio State University: "Dr. Giorgio Rizzoni, Director, Center for Automotive Research... His research has been funded by, among others, General Motors, Ford, DaimlerChrysler, Delphi , Visteon, Dana, ArvinMeritor, Fiat, Honda, Lamborghini..."
http://car.osu.edu/drupal/index.php?q=node/46
happy_penguin 5:58PM (11/11/2008)
Hmm, must be the same kind of firm that fabricates the $60 to $80 the workers make per hour.
Big Rocket 8:21PM (11/11/2008)
@happy_penguin: Just as I showed evidence of pro-industry lobbyists fabricating job loss figures to secure billions in government bailouts, if you have evidence that shows anti-UAW lobbyists fabricated the following labor costs, then please share the evidence with the rest of us.
NY Times, 2006: "On average, U.A.W. members at G.M and Delphi cost the equivalent of $67 an hour, including pay of about $27 an hour plus pensions and health care expenses."
http://www.nytimes.com/2006/03/23/business/23auto.html?ex=1300770000&en=57ea081b0a798618&ei=5088&partner=rssnyt&emc=rss
Bloomberg, 2008: "Ford's... $60 expense for a current UAW member's wages and benefits."
http://www.bloomberg.com/apps/news?pid=20601209&sid=aRxTHKjUeS7w&refer=transportation
Autoblog, 2008: "According to the Detroit News, UAW workers with at least 30 years on the job will get $70,000, plus full retirement benefits, and those with at least one year of service can opt to receive a $100,000 lump sum buyout option with six months of health care."
http://www.autoblog.com/2008/01/09/more-buyouts-for-chrysler-plant-workers/
happy_penguin 9:01PM (11/11/2008)
I can tell you what I don't have, what you don't have and what nobody other than some accountant in a dark corner will have is a balance sheet to prove how they arrive at those figures. That's because the corporation doesn't want you to know how they arrive at those figures because I will bet you that if you knew you'd find out how ridiculous it is, what they're calling "benefits" as they add them into hourly wages. I don't have to prove it's a false figure, because they don't prove that it is a true figure, and you can't prove it because nobody will provide you with the full information.
Big Rocket 9:46PM (11/11/2008)
@happy_penguin: First, you are assuming, without any evidence at all, the mainstream media outlets (New York Times, Bloomberg, Detroit News) have been regurgitating labor cost figures provided by GM's corporate accountants, all done with the hidden agenda to cast the UAW in a bad light. Alright then, for the sake of this discussion, suppose it is true. If you can't trust the mainstream media, perhaps you can trust the UAW president himself.
Bloomberg, 2008: "UAW President Ron Gettelfinger last month estimated that new contracts at Ford, General Motors Corp. and Chrysler LLC will save the automakers 'somewhere in the neighborhood' of $1,000 per vehicle. Buyouts of higher paid workers will help Ford increase the number of new hires at lower wage levels."
http://www.bloomberg.com/apps/news?pid=20601209&sid=aRxTHKjUeS7w&refer=transportation
That's about $1,000 for every vehicle in higher costs (or lost profits) for many years in the past, according to the UAW president. Can you still truthfully deny UAW's high labor cost weakened the competitiveness of the Big 3?
JN 12:44PM (11/11/2008)
Unless the restrictions (particularly for fuel-efficiency and other "green" provisions) stay, I say "no dice." After what we've all been through as far as gas prices this year, if the Three Stooges (my apologies to the late Moe, Larry, Curly, Shemp, Joe & Curly Joe) think they can get away with our tax dollars having no such strings attached, then let 'em go bankrupt.
Anyone who'd just give them a free pass like they have evidently given AIG ought to get a free ride out of Washington on a rail.
Reply
knifetramp 1:09PM (11/11/2008)
JN, I think the simple truth is that a "bailout" is less costly to our economy than having the Big 3 (and their thousands of suppliers) start walking the unemployment line.
Of course, it would be highly gratifying to see GM's failed "leadership" and their useless board of directors out on their collective ass.
Jake 1:30PM (11/11/2008)
So, their in this mess because the government, run by the union-own politicans, has been meddling with them telling them what they can do, how they can do it and whom they can hire to do it, and the solution is the give them more requirements on what they can and cannot do and so on and so forth?????
This is akin to attemptin to put out a fire by spraying gasoline on it. More of the same stupid stuff that is already being done.
The right answer is to let GM operate competitively in the free market without the two boat-anchors (unions, government) that they are currently dragging around.
Frylock350 1:55PM (11/11/2008)
@Jake,
Or just make the free market a FAIR market. $3500 tax on imported vehicles should balance things out AND keep American wages above the global standard.