The wildly successful auto industry bailout
Chrysler announced today that it is repaying $7.5 billion to the U.S. government years ahead of schedule. Meanwhile, GM has announced it will hire thousands of new workers in the U.S. after a successful IPO.
The bailout of the U.S. auto industry in 2009 by the Obama administration was very unpopular, but it will go down as one of the shrewdest decisions of President Obama. Letting GM and Chrysler go through a bankruptcy liquidation would have killed thousands of jobs and possibly turned the recession into a depression. Thousands of auto suppliers would have been insolvent immediately, thus creating even more job losses.
Most on the right, including presidential candidates Tim Pawlenty and Mitt Romney, opposed bailing out the auto companies. Mitt Romney even penned an op-ed arguing that we should let Detroit go bankrupt. They look like fools now, and the Democrats just released a preview of how this issue will be highlighted in the 2012 campaign, particularly in the Midwest.
Wildly successful, and the stock keeps going down- I can think of many other words other then “shrewed” when describing the Prez.
And successful IPO? It’s down $5/share since it was offered, I was retarded for buying it, and greatly regret it.
AND, I’m not buying what this AP “news” piece is selling.
The issue is not the GM stock price going forward. The issue is that GM and Chrysler still exist, along with all the jobs there and the jobs at their suppliers.
The issue is this was NOT a “wildly successful,” or “shrewd” move- it was an imbecilic move as everything this disaster cluster F does.
Here’s a telling article with a quote after:
http://www.theatlantic.com/business/archive/2011/05/gms-bailout-has
-been-a-huge-net-loss/238795/
“…the question was not whether GM could make a profit after a bankruptcy that stiffed most of its creditors and shed the most grotesque burdens of its legacy costs, nor whether giving companies money will make them more profitable. The question is whether it was worth it to the taxpayer to burn $10-20 billion in order to give the company another shot at life. To put that in perspective, GM had about 75,000 hourly workers before the bankruptcy. We could have given each of them a cool $250,000 and still come out well ahead compared to the ultimate cost of the bailout including the tax breaks–and over $100,000 a piece if we just wanted to break even against our losses on the common stock.
And if we’d done that, we’d have saved ourselves in other ways. We would have reduced some of the overcapacity that plagues the global industry. We would not have seen the government throwing its weight into a bankruptcy proceeding in order to redistribute money from creditors to pensioners, which isn’t a good precedent.”
The GM “bailout” was a mafia move to pay off the unions- no more and no less– typical political corruption from what is the worst administration ever– congrats to this clown for beating Cater. He’s horrible.
One more thing, addressing your next post- Palin or Bachman would be infinitely better than this complete idiot.
OK, now think of the next step. Most if the US supplier base would have been insolvent on the day that GM and Chrysler went bankrupt. How would that have affected the other auto makers? Why was Ford, their biggest competitor, in favor of the bailout? How much would the US government have had to pay out just in unemployment benefits had they not done the bailout? Also, this happened at a time when the crisis what happened under Bush’s watch was still going strong and the banks were not yet out of the woods. Burning $10 to $20 billion was a bargain here.
And on top of all that, you’re the idiot who bought their stock after the bailout?
Maybe that’s why you’re so upset . . .
Look at the difference in the Dow Jones since the date the bailout was announced until now. You should send Obama a personal thank you note
I knew this ap piece was a bullsh*t story– NEVER believe the garbage lies in the news (unless it’s FOX, of course
)
http://www.washingtonpost.com/blogs/fact-checker/post/president-oba
mas-phony-accounting-on-the-auto-industry-bailout/2011/06/06/AG3nefKH_blog.html
Did you read this clown’s argument? He’s simply arguing about the numbers, saying Obama needs to include amounts Chrysler got under Bush before Obama was president.
He specifically says he is not discussing whether the bailout was a good idea.
Both sides can quibble about the numbers. The real issue is this – were you prepared like most GOP officials argued, to let GM and Chrysler go through a liquidation in bankruptcy right in the middle of our financial crisis?
That’s the issue.