QOTD: Should the Feds Bail Out GM?

Robert Farago
by Robert Farago

It's been a frenetic couple of few news days, and most of it's been bad. Especially for GM. Thirty-two GM plants are off-line, high-profit truck and SUV U.S. sales are in the tank, production's been cut, GMAC is in the the crapper and… CEO Rick Wagoner got a 64 percent pay raise! Having GM DW'ed this saga since April 2005, I'm just about ready to pronounce the company R.I.P. (New Death Watch on its way). Let's assume for a moment that I'm right: GM files for C11. It seems perfectly obvious to me that if either Democratic presidential candidate makes it to the White House, a bailout– perhaps in the Chrysler-esque form of federal loan guarantees– is a dead cert. McCain, on the other hand, went to Iowa, stood in front of the corn farmers and told them he would NOT continue federal subsidies. To use the venacular, that is some serious shit. I'm not so sure John would cut the check for GM. But should he? One way or another, GM employs millions of people. What kind of deal should the U.S. gov'mint cut with GM? Or… not?

Robert Farago
Robert Farago

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  • Ttacgreg Ttacgreg on Apr 30, 2008

    Impressive thread. I thought I'd be the radical skunk at the garden party here, but apparently not. We have the "two Americas" model going on right now. The economic elites enjoy socialism. They can do no wrong and society bails them out. Hey Mr CEO, sorry you are running your major corporation into the ground, here is your guaranteed multimillion dollar rewards anyway. The common people (the other 90-98% of us) are increasingly being cut loose to suffer "free market" forces. Got cancer? Health insurance inadequate? Free market! Sell your house off or die. "Free market" is code for letting moneyed interests run the affairs of our society and culture. That has, is, and will be a disaster to a nation that, at one time anyway, valued a strong dominant middle class. Current powers at be are destroying the middle class. The Free Market is a wild savage beast. It must be tamed and harnessed, domesticated like a horse, so to speak. That said, what public good would bailing out GM do? They are at the inevitable juncture I could see coming since the early 80's. My only sympathies and concerns are for those who have their pensions and health are tied to GM. Let GM die.

  • JK43123 JK43123 on Apr 30, 2008

    Absolutely not. These multinational corporations all want to be "global" with "free trade" but when they can't cut it, expect the US government to bail them out. If Chrysler had gone belly up in 1980 the other two would be in better shape now anyway (of course I wouldn't have my Dakota). John

  • Menno Menno on Apr 30, 2008

    You might have had a Jeep pickup, instead, John. Had Chrysler died in bankruptcy court, neither GM nor Ford probably would have touched it. However, could American Motors and their then-partner (owning some 20 odd percent at that time) might have been smart to step in and cherry-pick the best bits, and brands. Plymouth would have probably died (AMC and Renault were already in the small car biz), and maybe the K-car and future minivans could have been built as Dodge products. AMC and Chrysler worked together, with AMC actually manufacturing some cars for Chrysler in the later 1980's - and starting in 1973, AMC bought Chrysler automatic transmissions. They could have cherry-picked the best 5-star Chrysler-Plymouth and Dodge dealers, too. American Chrysler Motors could have been a success, but it would have required the assistance of Renault (for the money and some expertise). Ironic that in 1987, Chrysler bought AMC and Jeep from Renault, isn't it? The other ironic part is that it is little known that much of the 1990's success of Chrysler stems from the executives and engineers taken on in that merger - in other words, American Motors guys saved the day so the whole enchelada could be sold to the Germans and ruined. Ironic.

  • Dimwit Dimwit on Apr 30, 2008

    Yes. Absolutely! Bail, bail like crazy. Of course, it isn't MY money being used, and the corp being undead only helps my economy even more. So bail 'em out please, so we don't have to.