Car dealers are some of the most politically connected people in America. As we reported yesterday, more than a few axed GM store owners demonstrated their political muscles by forcing the nationalized automaker to rescind their franchise terminations. Further back in time, we highlighted the Obama administration’s “stealth” dealer bailout: a car dealer-specific Small Business Administration (SBA) loan program. Under the program, the SBA guarantees 75 percent of a car dealer’s floor-plan line of credit, ranging from $500,000 to $2 million. The SBA’s network of private-sector lenders make the loans. In theory. In practice, it’s been what the Brits call a damp squib. Although Automotive News [AN, sub] fails to put any hard numbers to the program’s failure, they acknowledge that the SBA dealer deal “has had trouble attracting lender participation since its May launch.” Needless to say, the “answer” to the SBA lenders’ entirely understandable reticence/prudence is . . . bigger loans and more federal backing.

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The WSJ reports that GM will draw “north of $2.5b” from its government escrow account to fund its own bailout of its major supplier, Delphi. Considering GM has committed $1b in debt assumption, $2b in forgiven claims and $1.75b in investments, we can assume the amount will be well north of $2.5b. But how much is left in that escrow account anyway? Estimates at the time of GM’s exit from bankruptcy were that some $20b was left to draw upon. And we’ll know exactly how much is left when GM discloses its government-money expenditures to the SEC by the end of this week. GM sources claim the money has not been used to cover operating shortfalls, and CEO Fritz Henderson has even gone on the record to say GM will not need further government assistance. Considering GM’s cash burn over the last four years was in the $10b/year range, let’s hope that claim isn’t entirely based on the assumption that a planned IPO next summer will be a rousing success.

No, we’re not talking about genuine job creation or a tax holiday for convicted felons. Well actually, we are. GMAC was given one humdinger of a present last year with $12.8 billion nestled near an open fire. That fire has now consumed nearly all that money. So the question now is what you should do if you were an involuntary investor in this black hole venture. Sue? Protest? Burn an abandoned house or two? Naaahh… just let the politicians shovel the greenery of course. The latest number under the bow is between $2.8 billion and $5.6 billion. Just in time to shop for more lobbying influence. Anyone need a sweetheart deal on their home mortgage? car? 401k plan? Contact your representative stat!

We’re not public yet but we will be and if we do our job that stock is going to have real value. We thought it was fair. We thought it was thoughtful

GM CEO Fritz Henderson comments on Pay Czar Kenneth Feinberg’s decision to dock his salary to a flinty $950,000. The AP reports Henderson’s total compensation could be worth $5.5m, apparently based on some unfathomable projection of GM’s IPO value. But Fritz is going to work for it. When asked if he’d read Steve Rattner’s magnum opus calling GM management “stunningly poor” and “perhaps the weakest finance operation any of us had ever seen in a major company,” Fritz’s responds in the affirmative…

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The New York Times reports that the “troubled finance company” known as GMAC is hitting-up Uncle Sam for more, as-yet-unspecified billions. The Gray Lady tells us it’s not a question of “if”, it’s a question of how GMAC and the Treasury can sleaze the deal, so that taxpayers don’t end up owning the company. ‘Cause that would “reignite” the “debate” over the bailouts that have already been given. “GMAC and Treasury Department officials have been locked in negotiations over how to structure the third bailout as it approaches a crucial deadline in early November for shoring up its finances [as a $5.6 billion payment comes due]. The government has injected $12.5 billion into the company and already owns about a 35 percent stake from a broader restructuring of General Motors, its onetime parent.”

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Is anyone surprised that the lawyers who guided “old” GM into the dustbin of history scored $255,555 a day for 90 days? The $23 million price tag seems like small beer to me. According to The Detroit News, “AP Services, headed by Al Koch, who doubles as the chief restructuring officer of GM’s bankruptcy estate, had a team of 153 people working on GM’s bankruptcy case, and several charged $835 an hour in June.” Fair enough, you know, for a $50 billion-plus taxpayer “investment.” Besides, AP dropped their rates when the Justice Department bitched about them to a federal judge. Of course, the move wasn’t retroactive. But then, why would it be?

Former head of the Presidential Task Force on the Auto Industry, Steve Rattner has penned a retrospective for Fortune on his time guiding the auto industry bailout. He covers everything from how he assembled his team and developed a strategy to the decision to fire Rick Wagoner and the showdown with Chrysler’s creditors. There are no real surprises if you’ve followed TTAC for the last year or so, but it’s fascinating stuff to read coming from the horses mouth. Take Rattner’s initial impressions of the GM “culture thing”:

Everyone knew Detroit’s reputation for insular, slow-moving cultures. Even by that low standard, I was shocked by the stunningly poor management that we found, particularly at GM, where we encountered, among other things, perhaps the weakest finance operation any of us had ever seen in a major company.

For example, under the previous administration’s loan agreements, Treasury was to approve every GM transaction of more than $100 million that was outside of the normal course. From my first day at Treasury, PowerPoint decks would arrive from GM (we quickly concluded that no decision seemed to be made at GM without one) requesting approvals. We were appalled by the absence of sound analysis provided to justify these expenditures.

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“What do you think the percentage likelihood is that, if we give this deal a chance, it will succeed?” Rattner didn’t make the decision any easier. “Fifty-one per cent,” he said. “But, Mr. President, in my experience, deals get worse, not better, over time.”

Ryan Lizza recounts the decision to bail out Chrysler in his epic New Yorker piece on Larry Summers and the president’s economic team [via Kausfiles]. This exchange came after the economic council split 4-4 on the automaker bailout, and Rattner was identified as the tie-breaking vote. Is it safe to say now that nobody expects Chrysler to survive?

“There must be increased access to capital through the entire supply chain — from the largest tier one to the smallest family-owned firm,” Dave Andrea, vice president of industry analysis and economics at the Original Equipment Suppliers Association told the Senate Banking Committee [via The Freep]. “Without assistance this country will needlessly lose manufacturing capacity, technology development and jobs.” Which is about what suppliers have been telling congress since bailout mania struck. What the Freep fails to properly explain is that the supplier bailout passed earlier this year was an unmitigated disaster for suppliers and their relations with OEMs.

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From The Detroit News:

Pelosi said Democrats want automakers to “thrive,” and she hasn’t ruled out additional support for automakers if they show that they are “viable.”