Bailout Watch 196: The Battle Lines Are Drawn Pt. 2
The weekend talkers are going all-Motown all the time, as Dems talk up their bailout plans and Republicans show off some freshly-developed backbone. And if you talk about Detroit long enough, some nasty things are going to be said. “They’re not building the right products,” Alabama Senator Richard Shelby told Meet The Press (via AP). “They’ve got good workers but I don’t believe they’ve got good management. They don’t innovate. They’re a dinosaur in a sense.” And Shelby, the senior Republican on the Senate Banking, Housing and Urban Affairs Committee, doesn’t give money to dinosaurs. “Companies fail every day and others take their place. I think this is a road we should not go down,” he said. The second ranking Republican in the Senate, Jon Kyl (R-AZ), agrees. “Just giving them $25 billion doesn’t change anything. It just puts off for six months or so the day of reckoning,” Kyl told Fox News. Isn’t it amazing what losing a few elections will do to a party’s sense of principle? Of course, the Rs are running downhill on this issue too. All they have to do is delay bridge loans until Obama is sworn in, and the question will become moot as the automakers run out of cash. And they’ll be scoring populist points (at least with us) every step of the way.
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It certainly doesn't hurt the Republicans that most of GM, Ford and Chrysler are based in "blue" states and a primary benefactor of any bailout is the UAW.
Shelby wants C11 for GM, and it is a doomed option. Shelby probably knows it and thinks it's a foregone conclusion that GM will fail, with or without C11. I'm in favor of a lifeline for GM until late 2010. By that time, GM will have engineered its own fate. Wagoner can improve GM's chances by resigning. If he really believes a bridge loan of 1-2 years will be enough, he should be far more transparent with his strategy.
Shelby's just reppin his non-unionized hood.