Congress Denies Big Three Bailout For Now

After two days of hearings, the CEOs of Chrysler, Ford and GM failed to convince Congress that they deserve federal assistance in the form of a $25 billion loan. The Democratic leadership requested more-concrete written proposals by Dec. 2. If the argument is compelling enough, more hearings will follow and Congress will convene Dec. 8 for a vote. This will be the automakers' last chance for action before President-elect Barack Obama takes office Jan. 20. GM in particular warns that it might run out of cash before year end, touching off a domino effect that could take down suppliers and other automakers.

Congress was left questioning if a loan would work, if the companies would be back soon asking for more money and whether assistance would result in long-term viability. The Detroit executives didn't help their case by flying to the hearings on corporate jets and becoming cagey when asked how they arrived at the $25 million figure and if they would personally accept salaries of $1 per year as a symbolic gesture.

Comments

[Jules]

I'm sorry. It's reasons like this I say to let the Big 3 die. Sure Toyota, Nissan, and all them good companies are from Japan. BUT, they brought many plants over to the US which brought many American jobs. So anyone who says they don't help America's economy is obviously in need of a Dunce cap.

[markt]

i would say give ford some money, they seem poised to pull them selves out without govt assistance. GM although i would like to see it die, shouldnt be allowed to, simply for economic consequences. GM folding will be like setting an atom bomb off in NY city. disaster for all americans. give them money, but only to redesign their product line and bring some of their european cars here. Ford should do the same too. i wont even talk about chrysler, let them die.

[James]

I think it's great that my party is finally willing to let GM die on the vine like they deserve. Now I'm proud to say I am a Democrat. Bad companies like GM don't deserve to live-on.

[B]

These chumps won't come back with any decent proposals, but it doesn't matter because Congress will relent and fork over the cash anyway. This crummy can will get kicked down the road one way or another.

[Skinner]

Jules..." Sure Toyota, Nissan, and all them good companies are from Japan. BUT, they brought many plants over to the US which brought many American jobs. So anyone who says they don't help America's economy is obviously in need of a Dunce cap."
The reason they built factories over here is because those cars would have been taxed / tarrifed to death otherwise! It was NOT out of the goodness of their heart, as you imply.

[Tony]

I would just get them all arrested for recket

[Tony]

Skinner,
I don't understand your position. As a matter of fact, Toyota, Honda, Nissan are an American Auto industry. Because they make cars here. The reason they do it here is because here they are next to the consumer. Do you think, shipping and packing is free? This is normal practice for any automaker. If they sell large volumes they simply produce where they sell. This also gives them flexibility to modify cars for specific market. Another thing to consider is Kioto agreement. Japanese makers couldn't produce everithing in Japan. They would probably run out of "dirty air credits". Since America didn't sign the Kioto pact, for any manufacturer is a good way to come here and pollute here.
And don't tell us a thing. Because GM, Ford, they build cars in Canada and Mexico. Surelly, if they didn't have union and pension overhead they would be OK to keep factories in the US.

[Sam Silverberg]

Hail to Nancy Pelosi and my fellow Democrats for not giving in! Even if GM was given $50 Billion why should anyone believe they would be successful? Toyota, Nissan, Subaru, Honda, are not begging the US or Japanese tax payers for a bail-out!!!! Bottom line is GM deserves to go out of business because they make low quality unattractive vehicles.

[GV]

WE TAXEPAYERS WILL NOT BAIL THESE CORPERATE GREEDY PEOPLE THAT ONLY WANT THERE SALARIES SAFE !!!INSTEAD GIVE US THE MONEY THE AMERICANS THAT NEED IT THE MOST !!!

They all flew to D.C. in private corporate jets and want money to save the asses?
Common sense?

[Bloke]

I couldn't agree more about the corporate jet thing. What a bunch of a**holes. I would also love to be the one to ask a CEO of one of those companies if they can deal with getting $1 for a years salary. That should be definitely be in the stipulations. I would really rather see a situation where those who cannot afford a new car, and who drive an older vehicle without the gas mileage or emissions of a newer model get some kind of grant to purchase a new GM, Ford, or maybe even a Chrysler.

[GR]

Sure, they could easily agree to a $1 salary but their bonus will be several million. They need to start firing from the top!

[Trainer]

Give the bailout incentives to car BUYERS: tax credits for anyone who buys a new American nameplate vehicle, make interest on car loans tax deductible, and allow people to take money out of their 401Ks tax free for the purchase of a new American vehicle. At least people who need new transportation would benefit from the bailout money, and the measures would revive the big three.

[JM]

Hail to the Pelosi and the Democrats for not giving in?!

Are you kidding me?!

SHe's the one that wants to bail everyone out instead of just letting them go bankrupt like they are supposed to! PELOSI is the one messing up the capitalist system.

Here's something for the liberals: you guys are big on handing everyone what they 'want' when they 'want' it, so why not just buy up the inventories of the Big Three and then just give them to the American people?

[JM]

Hail to the Pelosi and the Democrats for not giving in?!

Are you kidding me?!

SHe's the one that wants to bail everyone out instead of just letting them go bankrupt like they are supposed to! PELOSI is the one messing up the capitalist system.

Here's something for the liberals: you guys are big on handing everyone what they 'want' when they 'want' it, so why not just buy up the inventories of the Big Three and then just give them to the American people?

[d money bags]

i would like to purchase an american car but quality & customer service has gone down so much over the years i'm forced to consider german engineering .
also there's isnt any more true american cars... ie ford mustang, take a look at the sticker you"ll find the tranny is from france... during the bailout proceedings the chrysler ceo spoke of high quality in reference to their product ... where's this evident

[d money bags]

whats sad is most of us if not all americans want to purchase n take pride investing in our nations products, but corps here are only interested in profit not customer loyalty & product quality.foreign automakers have mastered this simple understanding. u provide a good quality product n the result is not just profit but longterm unprecedented revenue. funny... greed in business does produce a profit but far less profit than good business.

[DodgeFan]

I leaning towards the loans which are not a bailout. That 700 billion to the financial industry is a bailout. What hard assets do the financial industries have, none!!! If this companies go bankrupt the tax payer will pay more to fund the pension plans of the autoworks. Do people here know of Pension Plan Guarrentee Corp? Can anybody say Medcaid (spelling?) for poor people. Or how about Unemployeement insurance, ohh my states already run out of money there too? How about all the other states that are beggin the government for a loan. We all pay one way or another.

[MotorTrendYesUSA]

Unless we all stop this American bashing in the US and start some more buying of Ford, GM, and Chrysler cars then several million taxpaying Amercians will be out of work when the Detroit 3 go belly up and that will hurt your neighbors, your family, your beloved Honda, Subaru and Toyota and your local government that operates your schools.
Millions of Big 3 cars routinely go to 150,000 miles and over and are bringing owners to their jobs day in day out.
The stereotype that some of the old Big 3 bashers continue to spout about the quality issue is false at this time.

[Tony]

Last post....

---At this point big 3 have ruined reputation on quality by their past.
--- Their corprote management proved disaterous
--- Since they are almost "done", less people will buy their product fearing, who is going to support warranty

At this point, this is point of no return. They must go down.

[R Kolk]

When the two auto executives from Ford and GM were asked if they would also work for a dollar. They should have responded with: If our pay is based on performance then so should congress don't you think?

[Tony]

R Kolk,

You good, man. You good. Seriously. You're right.

What I heard is that in some successfull asian country there is a law under which the CEO can't make more then (something like) 50 times then least paid worker.

May be if in the US we would make a federal law like this then we would see less corporations go down.

Note that this is salary law and has nothing to do with the ownership. I fear some people will jump on me and say that I am socialist :o) like they do to Obama because he wants 3% extra.