A bailout too far

December 12, 2008

AUTOS/Senate Republicans who killed an auto industry bailout must have had a particularly nasty sense of deja vu. If they didn’t get on board, the economy would collapse. “For the hundreds of thousands of people whose jobs depend on this industry, this will not be joyous season,” bellowed Sen. Chris Dodd. It was up to the Republicans. To save Detroit, all they had to do was sign over a fraction of what they’d agreed to for Wall Street.

It wasn’t as if there was another industry waiting in the wings, ready to head to Washington demanding a bailout as soon as the automakers got theirs. So the Republicans couldn’t have feared yet another dollop of largess around the corner. Ultimately, it came down to good old lefty Union vs. rightly Republicans arguing over when workers would agree to take pay cuts.

Has the countdown begun to industrywide bankruptcy? That’s what the automakers say — because of their shared suppliers and vendors, the failure of one Detroit automaker could drag down the other two, as well as other businesses. GM, Ford and Chrysler employ nearly 250,000 people directly, and 100,000 more jobs at parts suppliers could hang on their survival. The companies say one in 10 U.S. jobs is related to the auto sector.

Rebellious Republicans argued that the White House, which favored the bailout, had become irrelevant. After all, the new president takes office in just over a month, making George W. Bush about as lame as a duck sunning on a Fort Lauderdale beach.

Attention is now turning to the Treasury Department’s tattered TARP program, and whether Hank Paulson will do an about-face and throw Detroit a lifeline from what’s left of the $700 billion rescue program for the financial industry. Could Bush’s grand finale be to thumb his nose at his own party and keep hundreds of thousands of people working through Christmas?

Deals of the Day:

* Germany’s Daimler signed a $250 million deal to acquire a 10 percent stake in Kamaz, Russia’s largest truck maker, executives from Daimler and Kamaz told a joint news conference.

* Britain’s Brulines Group said it had completed the acquisition of Vianet from the administrators of Vianet Group for an undisclosed sum.

* South Korea’s retail giant Lotte Group said it was in the bidding for Doosan Corp’s spirits-making division, in a deal reportedly worth up to $500 million, as it looks to beef up its liquor business.

* KB Financial, which runs South Korea’s top retail bank Kookmin, has sold a 3.2 percent stake in itself near the bottom of an offer range for $300 million, three sources with knowledge of the sale said.

(Photo: Reuters/Carlos Barria)

6 comments so far | RSS Comments RSS

And keeping people working through the holidays…about all it would accomplish. The UAW will not allow Detroit to survive – they suck the lifeblood out of whatever is left of the big 3(2.5) after the failed business models over the years have all but guaranteed their demise. One shouldn’t continue to pour oil into an engine that has already seized.

Posted by Robert | Report as abusive

I find it amazing that anyone who isnt intererested in giving the american auto companies loans have not been affected by the economy . why is it republicans are insistent on turning america into a third world country is beyond me .

Posted by Marc Anthony | Report as abusive

Anyone and i do mean anyone who thinks that after all the millions that have been given to the already rich kids on wallstreet and loan companies who out of greed started this big mess in the first place,thinks that the big 3 don’t deserve this money must be out to make the companies over sea rich.Are people that stupid to think that when the doors close that nothing will happen,do they think that things will get better,who and what is wrong with people who think this way.This country can’t handle what will happen,this country is not like it was in the 30s people today don’t think the way they did then.People today would come into your home and take what they want and do away with anyone who got in their way.Stop and think what would happen without a bailout,We don’t live in a God fearing country no more.God help us if this blows up in our face and it can.


Is no one thinking outside the box? “Trickle Down Economics” VS “Build From the Bottom UP”.
From the bottom up: A ONE-TIME ONLY EVENT – $1M to every citizen of the 50 US states, living in the 50 states, banking only in the US, paying taxes in US. Cost $2 – $3T. All these businesses would be salvaged without “gov’t bailout/loans”. THIS IS A WIN-WIN SOLUTION. Details are available.
Top down: Several trillion dollars already showing and it’s only the beginning. And nothing is really fixed.



Can you really be that naive? If the government is going to equally reward every citizen, why would anyone choose brain surgeon or engineer as a career when they can just work part time in a candy shop and make the same money? Then who would be left to to brain surgery or design more fuel efficient automobiles?

Scary thing about this is your suggestion is pretty much exactly what that socialist Obama is planning for us.

Posted by Matt | Report as abusive

Natalie: It’s called INFLATION. If everyone had 1 million dollars how much do you think people would charge for in demand goods? A lot, cause everyone’s a freakin millionaire.
dlb: I totally agree with you, the GOP has been trying to make us a 3rd world country in manufacturing, health, science, edumacation… not sure why but it may have something to do with being greedy traitors.

Posted by AdamC | Report as abusive

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