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Chris Wood

Any assistance plan must come with conditions. Executive compensation must be limited, and the companies must develop more alternative fuel vehicles.

UH2L

Good point Chris. I forgot to mention those things.

Ravindra Kharmai

Good points, and here a few other articles that supplement your view:

http://scrippsnews.com/node/38114

http://www.freep.com/article/20081117/COL14/811170379

http://www.washingtonpost.com/wp-dyn/content/article/2008/11/21/AR2008112101348.html

***Correction: GM's first plug-in hybrid (PHEV) vehicle is actually the 2010 Saturn VUE in which GM would still be the first full line vehicle manufacturer to bring the technology to market. The Chevy Volt is technically a Electric Range Extended Vehicle (EREV) and NOT a hybrid in the conventional sense. The difference is that traditional hybrid vehicles use both internal combustion engines and electric motors to propel the vehicle, whereas the Volt is driven only by the electric motors. The gasoline engine serves as a generator to recharge the batteries.

http://freep.com/apps/pbcs.dll/article?AID=/20080917/MULTI/80917011/1014

Todd

Atul,

I appreciate your passion. Other things to consider:

1) I guess the auto industry needs better lobbyists - or at least some key personnel directly invested in the future of the industry. Why are banks/insurance getting the big handouts? The government employees making those decisions (and leaving when the Bush administration ends) will be joining that industry when their government service ends. They stand to profit from handing out money to their future (or past) employers.

2) Why weren't the execs prepared for questions or at least the outline of a plan? That's basic business. If they weren't ready, how did they know that $25B was the right number? Congress was right to grill them; they should have grilled the other bailed out companies as well.

I don't agree that they'll repay the loans; it's more likely that the government will forgive those loans at some point in the future when things turn around.

I won't even ask where my handout is...

PHIL

Most of your article is accurate and unemotional, BUT how does any of this change the facts:
-Giving public funds to private business is illegal per the US Constitution
-Big Gov has no money to give away or "loan". The treasury is an empty cupboard.
-GM is gutless and will NEVER do the things it must to thrive. That is stand up to its worst enemies...Washington and the UAW.

Art A Layman

Excellent dissertation.

As much as the American populace has achieved more education, we have not moved far from the Salem witch trial paranoia.

If we had to depend on the cause and effect abilities of our populace, electricity would still be an enigma.

There is the looming question of whether $25B is all that is necessary. Simply telling the auto execs when the credit markets and the economy will turn around would enable an immediate answer.

Could it end up $100B or $200B? Very possibly. But it would still be cheaper than having the D3 fail.

Obama, employing political expediency, is calling for a plan before giving checks. Now this makes a lot of sense? To deliver an understandable, acceptable plan, they would all have to divulge proprietary strategies to each other and the world. Where does that get them?

My guess; they'll get the money, plan or no plan, after Obama is in the seat where the buck stops. He doesn't have a lot of choices. From a taxpayers perpective, you can make me pay now or you can make me pay later. Later will be far more painful.

mark Brown in NJ

Hey. I agree we need to save Detroit.
Detroit's big 3 need to survive. Long Live Detroit; however, The Automobile Industry is DEAD. Long live the TRANSPORTATION industry.

See MY blog post.
We need to give them loans, with a carrot to transform themselves into TRANSPORTATION companies.

here: http://sos-newdeal.blogspot.com/2008/11/next-prediction-save-car-companies.html
mark brown.

Aleksandar M. Velkoski

Is this really a "bailout" of the automotive industry? Or, is this a business loan that will be repaid to the government with interest (following the original Chrysler loan model)? What do we make of the $700 Billion provided to the financial industry? Was that not a "bailout?" Let's ask the following question: "will the financial industry pay back the $700 Billion bailout that they received (like the automotive industry will repay its $15 Billion loan)?" I think that the United States Government, the press, and the taxpayers need to rethink the way they discuss this issue.

I'm not taking a stand. Rather, I'm trying to generate some realistic and intellectual discussion. I understand the implications of the failure of the financial system. However, was AIG not a free market corporation? JP Morgan Chase? Bank of America? Where are the business plans and re-structuring plans for those organizations (whom are not even using the bailout funds they received to help free-up credit - the actual purpose of their bailout)? At the same time, what are the implications of the failure of the automotive industry? Which, mind you, employs how many people in the United States (and supports how many retirees)? We cannot extend a loan for $15 Billion to the automotive industry but can extend $700 Billion (or more) of taxpayer dollars to bailout the financial system? No questions asked? Something seems seriously wrong with this picture. Again, I'm not taking sides just trying to generate serious intellectual discussion.

The White House said today, "a precipitous collapse of this industry would have a severe impact on our economy,” and added, “it would be irresponsible to further weaken and destabilize our economy at this time." The White House seems to be correct. Do we really understand how interconnected the automotive industry is? How this could effect other large manufactures (including Toyota, Honda, and, more importantly, suppliers and professional services and support companies)? These are unprecedented times in the United States. As a conservative free-market advocate, I hold that we ALL need to take a second look what's going on here and what effect this will have on our lives and the nation. If you think you know it all, think again (and I include myself in that statement).

mark Brown

hey... take a look at my blog.

I agree that we need to save the AUTO companies.
over at my blog I say
1) save the JOBS and
2) Make the companies GREEN

1) http://sos-newdeal.blogspot.com/2008/12/auto-industry-rest-in-peace.html

2) http://sos-newdeal.blogspot.com/2008/02/proposal-transportation-and-energy.html

But the most important thing we need to do is;

FORCE the auto companies into a PRE-PACKAGED bankruptcy.
(the WARRANTY issue can very EASILY be taken care of the SAME way your TV is under warranty AN INSURANCE policy)
This pre packaged bankruptcy will last all of one day?

the stakeholders will agree to:
1) government taking over the medical needs of employees
2) Employess will give significant flexibility about health care costs.
3) Shareholders will agree to have government assume a large percentage of stock and ownership
4) DEALER networks (GM: example will go from 7,000 dealers in US to less then 1,000
5) new gm network called "GM", can sell any gm car in their NEWLY reduced line.
6) Newly trimmed companies will take the $$$ given by govenrment to retrain and retool to go into mass transit business.

7) dealers will also re-tool to become local installation/repair/maintenance groups to service the new rail lines

PS: This proposal is mostly from Feb 2008!

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