Bailout Watch 346: Feds Turn on the Taps, Bailout Bonanza Begins
Even before President Obama becomes President Obama, the democrats have put a light on that Hill (go Jumbos!). In other words, the bailout bucks are flowing freely, with House Democrats unveiling an $825b stimulus bill. Here’s a challenge: define “stimulus” without using the words “pork” or “special interest.” And one of those special interest groups that’s especially interested in sticking their snouts in the federal trough: the U.S. auto industry. Surprised? “The money for advanced battery support includes $2 billion — half in loans and half in grants — and $200 million to encourage electric vehicle technologies,” The Detroit News, no stranger to industry encouragement, reports. “The bill also calls for $300 million to retrofit older diesel engines and replace some diesel vehicles, such as school buses, and use $400 million to help state and local governments buy more efficient alternative-fuel vehicles. Additionally, the measure includes $600 million for the federal government to replace older vehicles with alternative-fuel automobiles.” And get this: Motown’s hometown heroes are feeling shortchanged.
“The House bill will face changes when the U.S. Senate introduces its own bill, which is expected to shift more of the $2 billion in battery research money to grants not loans.” Yeah, why require them to pay it back? That’s… un American!
“Automakers should benefit from other provisions, including a $30 billion boost in highway construction spending and at least $31 billion to modernize federal and other public infrastructure projects, which should increase the sale of pickup trucks for work use.”
And let’s not forget the ethanol industry! “It increases to 50 percent from 30 percent an alternative refueling property tax credit, which could be used for installing rapid recharging units for electric vehicles and E85 pumps.”
Although GM CEO Rick Wagoner just pronounced the Chevy Volt a money loser, his PR spinmeister stayed on message.
“”It’s good to see the stimulus bill recognizes that to keep pace in the global technology race, the U.S. must make the capability to produce advance batteries a national, competitive priority,” Greg Martin said. “Greater advance battery funding can help jumpstart a green manufacturing sector and get advanced vehicles like the Chevy Volt on the road at greater numbers.”
The DetN reports that the House forgot to include some serious bailout billions. “Automakers had hoped to get a second $25 billion included in the stimulus bill for a federal loan program that was approved in September to retool older plants and equip new plants to build advanced vehicles or produce high-tech components, such as batteries and other parts.
“Automakers had also hoped that Congress would have added money to retire older vehicles, known as ‘Cash for Clunkers.’ Proponents wanted to give people up to $4,500 to scrap older, less-efficient vehicles in exchange for buying a new one.”
Oh, did you hear the one about the U.S. auto suppliers lining up for their shot at the federal bailout buffet? That’s one for another post. Meanwhile, how is this not socialism?
More by Robert Farago
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The difference between Reagans policies and what Obama is proposing is that Reagans worked. You will soon see the devastation of Obama's Keynesian policies. The problem with the economy is that the government is to big, to make it bigger is just going to make things much worse. We already have a very socialist high tax high regulation economy and that is the problem. If the companies cannot afford a very expensive health care system what makes you think the government can? Ayn Rand the Founding Fathers and the Constitution are in agreement that freedom in economics and life is the proper path. That is the proven system that works. Confiscating the money from the winners and handing it to the losers will not work. I have a few bucks and I am going to invest it where it will do me the most good for me. That is the proper way, and if the socialism in our society makes it unprofitable to invest in a business that would be for the greater good that is not my fault. The Depression ended with WW2. The US came out of the Depression by supplying arms to England and then bombed the competition to rubble. After WW2 the US controlled a huge amount of the economy since the competition was destroyed. West Germany and Japan quickly recovered through extreme hard work and capitalism. Socialist East Germany the rest of Eastern Europe and Russia have still not recovered to this day. Look up the "Economic Miracle" if you want the true story of the West German recovery. It wasn't mostly due to the Marshall Plan as is commonly believed in the USA. If you look at the history of socialism in the 20th century it is a succession of failures. Snort snort double snort Clinton was elected due to Bush 1 making a deal with the Dems to raise the taxes which they promptly used against him in the election. Kinda like Bush 2 making this deal with the Dems to waste trillions of taxpayer dollars on 'stimulous'. And then Ross Perrot taking a large chunk of the vote away from Bush 1. It had nothing to do with Reagan's policies. The Bush's seem to have a hard time learning you cannot trust the Dem's.