Bailout Watch 284: White House Promises GM and Chrysler TARP Funds

Robert Farago
by Robert Farago

The Washington Post reports that President Bush has signalled (from Air Force One no less) that he will “consider using funds from other sources to provide emergency aid to the nation’s Big Three car companies following the Senate’s rejection Thursday night of a Congressional bailout plan.” This is a reversal of Bush’s previous insistence that the money for Motown’s Troubled Twosome (Ford’s maintaining its low profile) must come from the Department of Energy’s $25b “retooling” loan program, and follows Congress’ abortive efforts to scarf the funds. “Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms,” the White House statement said. “However, given the current weakened state of the U.S. economy, we will consider other options if necessary — including use of the TARP program — to prevent a collapse of troubled automakers.”

Robert Farago
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  • Ronnie Schreiber Ronnie Schreiber on Dec 12, 2008

    no_slushbox, When an ideological conservative like Thaddeus McCotter (who will be the next governor of Michigan) supports a bailout, it's not because the UAW is giving him money - the UAW has given McCotter's opponents. He supports a bailout because the supply chain is strategically vital. Wage and price controls have never worked. Not under FDR and not under Nixon. Meanwhile, the president of the SEIU, the largest public employee union in the country, had material knowledge that Blagojovich was playing eBay with a US Senate seat and did they turn him in? No, the SEIU official, when Blago solicited a bribe, replied, on tape, "put that flag up and see where it goes." That's at most a hair's breadth away from participating in a criminal conspiracy.

  • No_slushbox No_slushbox on Dec 12, 2008
    Ronnie Schreiber: Thaddeus McCotter supports the bailout because he puts helping his rich supporters in Michigan stay rich even if it comes at the expense of US taxpayers and his principles. Claiming the bailout has anything to do with national security is a lie that the Republicans opposing the bailout did not fall for. There is no longer any overlap. Companies like Rolls Royce and SAAB have sold off their automotive units to foreigners because they want to focus on high-tech, profitable defense instead of low tech, money losing cars. Do you really think a war between the US and China or Russia is going to come down to who has the most light military vehicles? Not since Hiroshima and Nagasaki. The best engineers go into defense, and the auto industry gets what's left over. The lack of a defense industry is probably part of why Japan makes the best cars. "Wage and price controls have never worked. Not under FDR and not under Nixon." Neither has bailing out failed automakers: http://en.wikipedia.org/wiki/British_Leyland
  • PeteMoran PeteMoran on Dec 12, 2008

    Bloomberg are reporting Wagoner and Cerberus' Stephen Feinberg in private talks with Bush and officials. If Feinberg has direct access to Bush in this situation, it's done. This gets sillier by the minute.

  • Ronnie Schreiber Ronnie Schreiber on Dec 13, 2008
    Thaddeus McCotter supports the bailout because he puts helping his rich supporters in Michigan stay rich even if it comes at the expense of US taxpayers and his principles. McCotter's district is mostly middle class, though there are some more affluent folks on the north and west ends of the district. Looking at Opensecrets.org, the only "rich supporters" that I can find is the Thompson Foundation, set up by retired entrepreneur Bob Thompson and his wife Ellen. To get an idea of just how selfish they are, here's some info on them and their foundation: When Bob developed heart problems, he decided to sell the business to Oldcastle Materials in 1999. Thompson shared nearly one-third of the $461 million sale with his employees. He gave bonuses up to $1 million to those loyal employees who had been with the company for years, and set up annuity accounts for others who are still years away from retirement. Bob stayed on at the office to help the transition go smoothly and to continue to counsel and train existing team members to take his place. That same year, Bob and Ellen Thompson founded the Thompson Foundation with $100 million from the sale of the Thompson-McCully Company. The Thompson Foundation's mission is to help low-income people rise out of poverty and become self-sufficient. The Thompson Foundation has already: * Established 1,000 Detroit private school scholarships for Detroit inner city kids, 500 scholarships at Schoolcraft Junior College in Livonia, 100 Michigan Tech University undergraduate engineering scholarships, and 20 Michigan State University graduate scholarships; * Granted funds to dozens of other programs like food banks, guidance centers, and job placement and training facilities. Real greedy types, eh? Top 5 Contributors, Thad McCotter 2007-2008 Thompson Foundation $10,200 Air Line Pilots Assn $10,000 American Crystal Sugar $10,000 American Dental Assn $10,000 Bricklayers Union $10,000 Top 5 Contributors, Richard Shelby 2003-2008 Citigroup Inc $91,200 PricewaterhouseCoopers $68,250 JPMorgan Chase & Co $66,500 Southern Co $62,250 Collazo Enterprises $61,000 Looks like Citigroup and JP Morgan got their money's worth. BTW, Shelby's [s]slush[/s] campaign fund has over $13 million on hand.
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