Skip to comments.The auto industry lives. Can we admit that government intervention worked?
Posted on 08/02/2010 9:07:10 AM PDT by Nachum
Who could have imagined that the bailout of the auto industry, one of the single most unpopular moves by the Obama administration, would become one of its best talking points?
But don't for an instant imagine that the comeback of the nation's rescued car companies, particularly General Motors, will change the way we debate government's role in the economy. When it comes to almost anything the government does, ideology trumps facts, slogans trump reality, and loaded words ("socialism") trump data.
Let there be no mistake: Rescuing GM and Chrysler took political courage, and I want to put in a good word not only for President Obama but also for George W. Bush.
True, Bush's electoral career was over in December 2008 when he extended $17.4 billion of Troubled Assets Relief Program money to keep the companies alive long enough to give Obama a chance to act. Still, it took guts for Bush to decide not to "leave the next president to confront the demise of a major American industry in his first days of office." Yet it was Obama who put in the bulk of the cash -- in all, Bush's input had grown to $25 billion before he left office, while Obama put up an additional $60 billion -- and created the tough restructuring plan.
(Excerpt) Read more at washingtonpost.com ...
Uh, give the company to the unions. Screw the stockholders. Screw the dealerships. Take ownership of 60% of the company. $85 billion spent.... so far.
Um...How much profit did we make again?
Anything will give the impression it lives with that kind of cash infusion. Too bad they won’t be able to pay it back and nobody in their right mind will ever lend them money again. So, yeah, its fixed alright.
You forgot one: "Screw the bondholders."
Yeah...tell that to all the retirees who had GM Bonds and got screwed.....baawwaahhhhhhhh
Of COURSE it lives ! It’s subsidized by the government ! It can’t go out of business ! AMTRAK Redux !
If it were ALLOWED to die, then people who used to work the assembly line would go home, and start to build their OWN car design. Those designs would compete in the market place until the best rose to the top, and that one-time assembly worker would be head of his or her OWN car company !
REO stands for “Ransom E Olds” ! That’s not a coincidence !
May I suggest more coffee? You forgot the ‘barf’. ;)
It’s not dead yet, so that constitutes a policy that “works” ??
Lesee, the new “exciting” vehicle Government Motors has produced is the “Volt.” Its expense is such that its probably cheaper to buy and operate an SUV than to purchase this boondoggle.
GM survived. So did Ford. Which one is doing better today?
Which one, EJ, hmmmm?????
“The auto industry lives. Can we admit that government intervention worked?”
No, we can’t . .because it didn’t.
But we can admit you’re an idiot.
The foreign car makers received no bailout money and they survived. GM and Chrysler could have declared bankruptcy and survived.
Nationalizing the bulk of America’s auto industry was the SINGLE MOST TOXIC and WASTEFUL thing that that ass-clown Obama has done in office. Except for all the other toxic and waster things, LOL
GM Motors is now the biggest welfare scheme in history. And the Volt is going to be a disaster
Dionne is a demented know-nothing cheerleader.
Did China buy Detroit? Soros in charge of this propaganda also?
They are also dumping tons of GM and Chrysler cars on cities, Fed govt, etc. I bet Ford has not sold one vehicles to a city or govt entity.
GM is talking about an IPO this year or next year so the UAW members and O’s cronies will get rich off the assets they stole from bondholders.
So the future of General Motors (and the $50 billion taxpayer investment in it) now depends on a vehicle that costs $41,000 but offers the performance and interior space of a $15,000 economy car. The company is moving forward on a second generation of Volts aimed at eliminating the initial models considerable shortcomings. (In truth, the first-generation Volt was as good as written off inside G.M., which decided to cut its 2011 production volume to a mere 10,000 units rather than the initial plan for 60,000.) Yet G.M. seemingly has no plan for turning its low-volume eco-flagship into a mass-market icon like the Prius.
I know a divorced single woman in her late 50’s, with a bad back, who now works at a shop on her feet all day. She was a bondholder with GM as her major investment and protection for her later years. My understanding is that they really hurt the regular bondholders (traditionally blue chip bondholders are widows and orphan types), while they gave sweetheart deals to the big institutional bondholders. Horrible, horrible, cruel actions, that really underline that this is a government for the elites and is dedicated to hurting working Americans to help the elites.
|"Don't interfere with anything in the Constitution. That must be maintained, for it is the only safeguard of our liberties."
|"We have no government armed in power capable of contending with human passions unbridled by morality and religion. Our Constitution was made only for a religious and moral people. It is wholly inadequate for the government of any other. "
| Resistance to tyrants is obedience to God
|"The Constitution is not an instrument for the government to restrain the people, it is an instrument for the people to restrain the government - lest it come to dominate our lives and interests."
| "Public officials should not be chosen if they are lacking in experience, training, proven virtue, and demonstrated wisdom. "
|There is scarce a king in a hundred who would not, if he could, follow the example of Pharaoh get first all the peoples money, then their lands, and then make them and their children servants forever. It will be said that we do not propose to establish kings. I know it. But there is a natural inclination in mankind to kingly government. It sometimes
relieves them from aristocratic domination. They had rather have one tyrant than 500. It gives more the appearance of equality among citizens, and that they like.
I am apprehensive therefore perhaps too apprehensive that the government of these States may in future times end in a monarchy [not called a monarchy but an executive with monarchial powers]. But this catastrophe, I think, may long be delayed, if in our proposed system we do not sow the seeds of contention, faction and tumult, by making our posts of honor places of profit. If we do, I fear that, though we employ at first a number and not a single person, the number will in time be set aside, it will only nourish the fetus of a king (as the honorable gentleman from Virginia very aptly expressed it), and a king will the sooner be set over us.
-- Benjamin Franklin
I knew there was something I forgot!
Don’t forget the GM bond holders who were wiped out.
they were given billions, there was incentives to buy cars.
Of course the far left media will say it worked they are and have been so busy supporting this man in office that they have no clue what the average guy or gal thinks about any of this any more.
Is Amtrack a success too .
Dionne does not have the first clue as to what went on with GM and Chrysler. We will see in a few years what the results are.
“auto industry lives”- Like 10+% unemployment, this is a new standard. We celebrate that a company “lives” given enough subsidy. We no longer seek to “thrive” in a free market economy.
I used to have a GM and a Ford. Now I have two Fords. Did it work? No.
Yeah riiiiiight! The secured creditors got screwed, GM & Chrysler owe the taxpayers billions that we'll never see, and the taxpayer is on the hook for some $18 billion in pension funds for GM. And now GM unloads a dog called the Volt that only gets 40 miles per charge with a $8000 tax credit that the taxpayer is on the hook for.
That, or maybe the the moniker, ‘E.J. Dionne’ is sufficient barf alert in and of itself. ;)
their messiah and cult leader goes to MI and now the bias corrupt media who has not done their job in years will say the billions given worked.
Really , well maybe this corrupt bias media should maybe see the profits and billions paid back before they go cheer leading for him again.
Just in case you bias corrupt media types are trolling here then get this into your cult like minded heads.
You have been a disgrace to your profession, you are an embarrassment and yet you wonder why your viewers and sales are down.
It is this kind of bias crap and shoddy work amateur piece which shows how pathetic your reporting has become. GET A GRIP OF YOURSELVES
The author of this article E.J. whatever has no clue how business works. The bailout only bailed out the unions.
If it protected the bond holders and the stock holders THEN it might have been a success.
The volt is just proof of failure.
how many new cars have just been bought by this far left socialist radical Govt when they didn’t really need to but did to try and make GM look like they are selliing?
Government Motors will never pay back Treasury.
In fact, it is having difficulty turning a profit despite writing off massive amounts of debt (greatly reducing interest expense), massive amounts of assets (greatly reducing depreciation expense), vast amounts of intangibles (greatly reducing amortization expense), vast amounts of employee pensions and benefits costs (greatly reducing labor expense), and shutting down money losing brands, product lines and factories (greatly reducing operating expenses).
The company is now driven by politics - e.g. closing profitable white dealerships and building green cars.
GM is a dog that needs to be auctioned to the highest bidder - who in all likelihood will sell most of the company's remaining assets for scrap.
Dionne is a statist hack.
The lamestream media purposely distorts the numbers. $60 billion to GM, $7 billion paid back. $15 billion to GMAC, zero paid back. $12 billion to Chrysler, $2 billion paid back. Bond and stock holders got raped for more billions, but the unions were saved. The taxpayers and investors will never see their money back if Government Motors is depending on the 0zer0 Volt to save them.
If GM and Chrysler had filed Chapter 11 they would still be operating under Chapter 11. The difference is they would be owned by the bondholders instead of the Government and the Unions. The Unions of course would have had to take substantial cuts in Wages and benefits as part of the deal to keep operating in Chapter 11 but now they get to keep their wages and benefits ( aren't we taxpayers lucky to have subsidized such a wonderful group of people) and they own most of the company !
All part of spreading the wealth ... to Obama's supporters.
That’s like claiming that the fact that several hundred million people emerged alive from the end of the communist era in the USSR and eastern Europe are proof that communism “works”. Yeah, but compared to what?
The real test will be down the road.
Just wait when cities and states start settling their municipal bonds in the same fashion in order to pay for pensions.
GM and Chrysler are just walking dead. When they have more layoffs their won't be enough Democrat voters left to justify another bailout.
“Well, ther’ ain’t no sense in it. A body might stump his toe, and take pison, and fall down the well, and break his neck, and bust his brains out, and somebody come along and ask what killed him, and some numskull up and say, ‘Why, he stumped his toe.’ Would ther’ be any sense in that? No. And ther’ ain’t no sense in this, nuther.” -
Mark Twain, Adventures of Huckleberry Finn
EJ Dionne seems to be using the same tortured definition of ‘success’ as Twain’s characters do in identifying a cause of death. If you ignore all that has gone before and doggedly portray the outcome as a thriving industry when it is anything but then logic has completely gone out the window.
Which one is still running on government handouts? Which one took a TARP load and paid it back with another TARP loan?
How did the last car company bailout work for a car company? Look up the Henry J by Kaiser - Frazer or also known as the Red Car. After a loan in 1950 from the government it was agreed to build this car the government way. Priced at under 1,300 (1,299) it did not have luxuries like a glove box, trunk lid, or passenger sun visors. Thanks to government intervention that is why today there are so many models of Kaiser-Frazer available today.
Yes, making union retirees comfy is the goal of business and taxpayer bailouts...Dionne is another Lefty maggot who spews the ‘Bammy lie-vomit.
Quantifying just how much taxpayer money will have been wasted on the hastily developed Volt is no easy feat.
Start with the $50 billion bailout (without which none of this would have been necessary), add $240 million in
Energy Department grants doled out to G.M. last summer, $150 million in federal money to the Volt’s Korean
battery supplier, up to $1.5 billion in tax breaks for purchasers and other consumer incentives, and some
significant portion of the $14 billion loan G.M. got in 2008 for “retooling” its plants, and you’ve got some idea
of how much taxpayer cash is built into every Volt.
American Thinker 8-1-2010
STOP SPENDING FOOLS!!!!!!!!!!!1
Another point that needs to be emphasized. Any pension trustee that invests in a company with a large union labor force needs to be sued for the shirt off his/her back for gross negligence. They are on notice that their investment can be expropriated without compensation at any moment and there's nothing they can do about it.
What follows is an e-mail that I received this morning.
:”You can fool some of the people all of the time, and all of the people some of the time. But not ALL of the people, ALL of the time”
Sooner or later it will all come to light!
This could be a scandal of epic proportions and one that makes Nixon’s
Watergate or Clinton ‘s Monica Lewinsky affair pale by comparison. Why
was there neither rhyme nor reason as to which dealerships of the Chrysler
Corporation were to be closed?
Roll the clock back to the weeks just before Chrysler declared bankruptcy. Chrysler,
like GM, was in dire financial straits and federal government “graciously” offered
to “buy the company” and keep them out of bankruptcy and “save jobs.”
Chrysler was, in the words of Obama and his administration,
“Too big to fail,” same story with GM.
The feds organized their “Automotive Task Force” to fix Chrysler and GM. Obama,
in an act that is 100% unconstitutional, appointed a guy named Steve Rattner
to be the White House’s official Car Czar - literally, that’s what his title is.
Rattner is the liaison between Obama, Chrysler, and GM.
Initially, the national media reported that Chrysler ‘had made this list of dealerships’.
The Washington Examiner, Newsmax, Fox New and a host of other news agencies
discovered that the list of dealerships was put together by the “Automotive Task
Force” headed by no one other than Mr. Steve Rattner.
Now the plot thickens.
Remember earlier we said that there was neither rhyme nor reason why certain
dealerships were closed?
Actually there’s a very interesting pattern as to who was closed down. Again,
on May 27, 2009, The Washington Examiner and Newsmax exposed the connection.
Amazingly, of the 789 dealerships closed by the federal government, 788
had donated money, exclusively to Republican political causes, while contributing
nothing to Democratic political causes. The only “Democratic” dealership on the
list was found to have donated $7,700 to Hillary’s campaign, and a bit over $2,000 to
John Edwards. This same dealership, reportedly, also gave $200.00 to Obama’s campaign.
Does that seem a little odd to you?
Steve Rattner is the guy who put the list together. Well, he happens to
be married to a Maureen White.
Maureen happens to be the former national finance chairman of the Democratic
National Committee. As such, she has access to campaign donation records from
everyone in the nation- Republican or Democrat. But of course, this is
just a wacky “coincidence,” we’re certain.
Then comes another really wacky “coincidence.”
On that list of dealerships
being closed down, a weird thing happened in Arkansas , North Louisiana , and
Southern Missouri. It seems that Bill Clinton’s former White House Chief
of Staff, Mack McClarty, owns a chain of dealership in that region, partnered
with a fellow by the name of Robert Johnson.
Johnson happens to be founder of Black Entertainment Television and
was a huge Obama supporter and financier.
These guys own a half dozen Chrysler stores under the company title of
RLJ-McClarty-Landers. Interestingly, none of their dealerships
were ordered closed - not one!
While all of their competing Chrysler/Dodge and Jeep dealership were!
Eight dealerships located near the dealerships owned by McClarty and Johnson
were ordered shut down.
Thus by pure luck, these two major Obama supporters now have virtual
monopoly on Chrysler sales in their zone. Isn’t that amazing?
Go look in The Washington Examiner, the story’s there, and it’s in a dozen
or so other web-based news organizations; this isn’t being made up.
Now if you thought Chrysler was owned by Fiat, you are mistaken. Under
the federal court ruling, 65% of Chrysler is now owned by the federal
government and the United Auto Workers union!
Fiat owns 20%.
The other 15% is still privately owned and presumably will be traded
on the stock market. Obama smiles and says he doesn’t want to run the auto industry.
As horrifying as this is to comprehend, and being as how this used to
be the United States of America , it would appear that the president has the
power to destroy private businesses and eliminate upwards of 100,000 jobs
just because they don’t agree with his political agenda.
This is Nazi Germany stuff, and it’s happening right here, right now, in our back yard.
There are voices in Washington demanding an explanation, but the “Automotive
Task Force” has released no information to the public or to any of the senators
Demanding answers for what has been done.
Keep your ear to the ground for more on this story. If you’ve ever wanted to
make a difference about anything in your life, get on the phone to your
national senator or representative in the House and demand an investigation into this.
Benjamin Franklin had it right when he said, “All that’s necessary for evil to triumph
is for good men to do nothing.”
Car Czar No More
An amazing thing happened as this story was going to press. Obama’s Car Czar,
Steve Rattner, resigned on July 13 and was promptly replaced by former
steel workers union boss Ron Bloom.
According to CBS News, Rattner left “to return to private life and
spend time with his family.”
Treasury Secretary Tim Geithner said, “I hope that he takes another opportunity
to bring his unique skills to government service in the future.”
By the way, Rattner is under investigation for a multi-million dollar
pay-to-play investment bank scandal in New York .... Uh-oh!
But, we’re certain that had nothing to do with his resignation.
And, according to several news sources out there, there are rumors he’s being
investigated for what could be pay-to-play scandal involving the closing of
Chrysler and GM dealerships. Really? Again, that couldn’t have anything
to with his resignation-that’s ridiculous! Like CBS said, this guy just
wants to “spend more quality time with his family.”
Obama has 32 personally appointed “czars” who answer to no one but
him, all of whom are acting without any Constitutional authority but paid by YOU the tax payer.
But hey, we’re sure they all have “unique skills,”......as Tim Geithner likes to say!
SOOOOO. HOW’S THE CHANGE WORKING FOR YOU?..
Check it out at the following websites.....
This goes beyond corruption in
high places - to gross criminal actions on the part of our government!
I hope you will spread this far and wide, and hopefully the taxpaying
public will demand some of that transparency we were
promised......followed by criminal prosecution of the perpetrators!
What a crooked government we have!!!!! Vote ‘em all out...November, 2010!
Please, do not post commie propaganda on FR.
the auto industry would have survived regardless. what the obama administration saved was the UAW.
Sure it “works” ... if you give me a few million, I’ll stop working and THAT WILL WORK too (at least for me!).
Not a joke,- but I really do consider not posting their lies here. However, I learn so much from the posters on a thread like this that it is instructional. Yes, it makes one upset, or mad to read the lies, but hearing our response to them is more than helpful.
The "rescue"/bailout of GM and Chrysler only DELAYED the bankruptcy filings of both. The subsequent government takeover and interference with the bankruptcy process screwed a bunch of teachers out of substantial portions of their retirement funds, and screwed a bunch of other investors (along with the taxpayers) out of funds, and ultimately left both of these companies probably in worse condition than they would have been had the bankruptcy reorganizations been allowed to naturally play out according to the rule of law.