Posted on 11/12/2008 3:37:20 PM PST by Fred
Rick Wagoner's future as chief executive of General Motors Corp. may hinge in large part on what kind of bailout the ailing auto maker gets from the U.S. government.
Momentum is building in Washington to provide financial help for the auto industry and Nancy Pelosi, speaker of the House of Representatives, plans to push for legislation next week to give "emergency assistance" to auto makers in a lame-duck session of Congress.
Three big financial institutions that got federal bailouts -- including insurer American International Group Inc. and home-lenders Fannie Mae and Freddie Mac -- had to replace their top executives as part of terms worked out with the Treasury Secretary Henry Paulson.
Mr. Wagoner said earlier this week he sees no reason to resign, telling Automotive News that "it's not clear to me what purpose would be served."
On Wednesday, Tony Cervone, a GM spokesman said "it doesn't do anybody any good to speculate" on conditions the government might tie to financial help. "We have been careful not to be prescriptive with respect to terms of any loan program, but we do believe in the restructuring GM has undergone and don't believe it would be constructive to make a management change."
The question of replacing management may be less pertinent at Ford Motor Co. and Chrysler LLC because those companies brought in new CEOs from outside the industry in the last two years. Also Ford said it is preparing for the future without counting on additional governmental loans while GM has said they're necessary for survival, raising deeper questions about decisions made by its current leadership.
On Wednesday, House Financial Services Chairman Barney Frank said that the CEOs of the Big Three auto makers, and the United Auto Workers, have been invited to attend a hearing on an aid
(Excerpt) Read more at online.wsj.com ...
Dealing with Frank? I imagine its all under the table...so to speak.
Bush should tell the dems that he won’t sign any bailout deal unless it involves reworking the union contracts that constitute a major component of the problem facing the automakers in the first place.
Wagoner has no concept of what a worthless piece of dog dung is.
This is mainly a rescue package to bail out Auto unions.
The current model at US car manufacturers is broken and unsustainable. They need to go bankrupt and the new owners need to void all union contracts and fire all the top executives without giving them golden parachutes.
Anything else is good money down the rat hole.
I think that would require a small amount of backbone. So it's not going to happen. Bush is more apt to throw the tax payer under the bus, for a trade deal that would lower peoples income and move more business out of the country.
It can’t be that easy. If we throw money at GM don’t you think the Japanese, French and Germans will sue for trade damages?
It is silly to subsidize bloated payroll lists when Michigan unemployment is at 9% and heading higher. Let the labor rates sort themselves out in the market. In the south they are building better cars for 25% less cost than in Michigan.
Hey maybe Obama can appoint Peggy the Moocher CEO of GM. Then she really wouldn’t have to pay for gas.
You think its going to help?
GM can keep building cars, but who is going to buy them? GM employees? Almost nobody else can get a damn car loan, probably 1/3 of the car dealers will be out of business in the next 12 months and there will be a glut of new cars siting on vacant lots that few will even want to buy if they could.
But GM will keep making more cars with US Treasury dollars? Makes no sense.
No they won't, they have to pay the workers whether or not they are making cars (so says the union contract) but they don't have to buy the materials. So the UAW employees will sit on their asses collecting our tax dollars and not produce a single f'in car.
Under the Table? I rather imagine it will be behind the back...your back, my back...everyone’s back...
I guess the DhimmiRats found such success in creating a couple of generations of entitlement driven voters that they will now start on corporations. Unions have been in the LibTards’ pockets for many years, anyway.
bahney fwank et al can’t effectively run their own lives, And everything in America, except feeding my cat, has been turned over to them.
The sooner this all disintegrates, the better.
Barney is lobbying for a bigger stick shift.
There is a market out there...GM builds some good cars. Some of the new ones coming out in the next year or two are wonderful. What makes you believe that an American worker can’t build a great car. Do you hate your country and fellow citizens that much? I remember a time when Americans were proud of their country and business. Also, if the big three fail prepare for huge price increases for cars. Hopefully this will not happen.
There are millions of jobs at stake here. GM has been struggling, but it is the credit crisis caused by our Wall Street buddies that pushed it to the edge. You don’t seem to understand. The kind of job losses we will see if GM and other companies fail will cause another depression. The economy will literally melt-probably deflation will be the problem. This is a much worse economic situation then inflation.
Again, aside from my job, I do not believe a great country can remain great without a thriving manufacturing base. Look where the areas of growth are in the world, and you will find a healthy manufacturing segment. America will not remain a great economic power and will not be able to afford the weaponry needed to remain a great military power with a service economy. Serving hamburgers to one another will not work in the long run. Also, if millions of manufacturing jobs are lost, what jobs will replace them? Will we have a European type permanently unemployed class? If so, prepare for socialism. People will demand the government provide them with health care and other benefits they used to provide themselves by the sweat of their brow.
I believe America is the greatest country on earth. American workers are the best also. Believe me, there are some really good decent men and women who work for GM on the line and in management who can build wonderful cars. Of course, you are too good to drive an American car apparently-judging from your post. You think foreign is always best- a self hating American. This is not a patriotic attitude, and it’s really bad for our country.
Sorry, I missed the part about car loans. some dealerships are providing loans. They are self financed. However, this is why money is being given to non-banking loan companies. Banks are hoarding money and won’t make loans. Paulson is going to give the money to basically credit companies who will take more risk. He has to get liquidity in the market or we are all sunk.
I don’t think my patriotism is at question. I went to a Dodge dealership, the car I like is 70% German. The Dodge Charger! An American classic.
It has nothing to do with patriotism it was, as you later noted, a question of personal finance. I live in California, where inflation is approaching 8% and will probably increase 50% in the next year. I know a guy who makes $100k a year, he couldn’t get a car loan for a Buick. The dealer said “sorry man, we would do if we could, but our lenders don’t have the cash”.
I just think the whole is greater than the sum of the parts in this case. With 12% unemployment fewer cars will be sold. With loans hard to get its even worse. But with a slow economy, people will likely prefer to hang onto their old car longer. Why buy a new car when you are a little scared, or a little embarrassed to show off.
I am seriously concerned. I recognize whats Paulson is doing with the latest loan scheme. But this abrupt turnabout sure doesn’t instill confidence in our leaders when they change their minds on important issues like this. Expect the stock market to shed another 500 points... maybe more.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.