Saving Detroit is Probably Up To Obama

Posted by: David Kiley on December 4, 2008

I’m not sure why they call these Congressional gatherings like the one in the Senate Banking Committee today to consider loanss to the auto companies…”hearings.”

Senate Majority Leader Harry Reid says today that the votes aren’t there to grant the loans. So, it would seem that these folks have stopped listening.

Saving the U.S. auto industry is going to be up to incoming President Obama to tap the $700 billion Wall Street bailout fund and the Federal Reserve once he takes office. The issue is how GM and Chrysler will avoid bankruptcy until he takes office.

Reader Comments

Paul (Vw)

December 4, 2008 10:32 AM

Obama saving Detroit? His political record is hardly anything of taking the initiative. If anything, he tends to wait until the eventual results are a fait accompli then decides in retrospect what side of the coin he was on.

It's chilling that current democratic majority in Congress is unwilling to take the initiative now. They were more than willing to send bills to Bush to end the war in Iraq only to have them immediately vetoed. Where is their courage now?

Getting back to placing faith in Obama whom we just elected? To quote Mr. Kiley himself from a recent posting: "And God help us if we keep going down the road of allowing the...results of poorly informed voters to make policy that could be the difference between Recession and Depression."

rocket

December 4, 2008 11:53 PM

Paul your view is 180 out of sink it is the stonewall Republican "One Mind Fits All" approach to solutions that has stopped progress for at least 8 years: "the times they are a changin"

Dude

December 4, 2008 11:55 PM

I beg to differ. Silence should not be perceived for making a considered decision. While the democratic majority should cease their belly aching let the one president in office today formally state what is going to transpire. Eventually it will work out but the bottom line is that B.O will make a decision and when he does he realizes his name and leadership capability will be tested. I am comfortable in his leadership, it cannot be any worse than what we have today.

Reality Check

December 4, 2008 11:57 PM

Where's the free enterprise?
What happened to good products?
What is going on about competition?

Let them sink!!!

It is a free market.

Jobs losses shall be covered with the insurance, workers comp, etc.

It is about time that the fat unions managers take the plunge too.

It is up to the people, start a new job in your garage and reduce consumption besides cutting in oil all the way around.

If Obama takes over this, he'll be the next fat cat.

chad

December 4, 2008 11:57 PM

Perhaps Paulson & Co. should realize that it is not merely the financial sector that steers the direction of the economy. I find it rediculous that none of the 700 bil is being offered when Detroit going down will be a lights out for the U.S. economy.

Charles

December 5, 2008 12:04 AM

Hey Paul (Vw),

Barack is not even President yet! Bush is. Why is Bush not doing anything? If Obama stepped into this, you would be complaining that he was overstepping his bounds because he hasn't been sworn in yet.

As far as your quote about poorly informed voters, If you're talking about the ones who put Bush in office twice, then I agree with you.

Opa2

December 5, 2008 12:05 AM

I really don't care about these auto executives. Nor do I give a rat's a++ about the members of congress "questioning" these gentlemen, as if anybody on those panels has even the least bit of understanding of what they are talking about. There is not a Senator with the possible exception of the guys from Michigan that knows anything about the automobile business. What is important in all those discussions is the 250.000 jobs that will go down the drain as long as Congress does nothing. Barnie Franks is right. White collar workers get bailed out. Blue collar workers get thrown out. Of their jobs that is. And the blue collar workers are the only ones that are blameless in this whole mess. The company presidents can afford to work for $1 a year. He made millions in the past few years. The blue collar worker worked his whole life at that plant and now, through no fault of his, sees it go down the drain. Shame on Congress if that happens and shame on Obama for not stepping in and telling people that this is what he wants done.

Myron

December 5, 2008 12:06 AM

David, you're right. Obama is basically the only person right now with the political power and wherewithal to make sure Detroit gets the loan that every smart person -- despite all the pontificating -- knows the Big 3 needs. This is not about the Big 3, but about the entire U.S. economy. You are correct that the issue is keeping GM an Chrysler solvent until January.

Herb

December 5, 2008 12:15 AM

Ah, Congress. I hear its members telling the auto workers and executives they must make sacrifices. I hear them tell Americans of all stripes they must make sacrifices.

I don't hear our elected represenatives offering to set an example by taking, say, a 10% pay cut. It is nobler, I guess, to say, "I share your pain..." than to actually do that.

Bill

December 5, 2008 12:22 AM

Paul I understand how difficult it must be for you to transition from a president that reacts before thinking to one that thinks before reacting. I have no problem with a president that can intellectually look at a problem and then try to solve it. I'm sure you think the shoot from the hip mentality has worked so well for us as a nation over the last 8 years. But unfortunately for you the majority of the country disagrees. I can't imagine why?

George

December 5, 2008 12:27 AM

Hey guys! Lets be real. Start with salary cuts like 10% for thoses making over $50k,over $100k-15%andover $250k-20% then will talk about loans.

chad

December 5, 2008 12:28 AM

Wow Paul, I guess your just way smarter than the rest of us! Sorry I don't think I want my tax dollars going to companies that are going to build Hummers and other gas guzzlers so I can also pay high gas prices! I also don't want my tax dollars going to companies that want to buy jets for their CEO's. I guess you make more money than me and enjoy giving it away to companies who are all about profit and not the future or the environment of our country!

George

December 5, 2008 12:30 AM

Hey guys! Lets be real. Start with salary cuts like 10% for thoses making over $50k,over $100k-15%andover $250k-20% then will talk about loans. That goes for the government worker and the politicians.

LM

December 5, 2008 12:35 AM

Something is very wrong. Paulson comes screaming to the President that his buddies on Wall Street, (who we don't know) need 700 billion immediately, with no strings attached and no oversight. And, Congressmen and Senators from both parties agree to Paulson's demands without blinking.

Enter "Detroit". There are people we can see on TV, people with fairly familiar faces, the leaders of an industry that employs millions of Americans, and they have to plead for help to save American jobs.

What's wrong is this picture?

chris hackney

December 5, 2008 12:47 AM

to heck with bailing out detroit/those jerks messed their companies up themselves! why should they get bailed out because they ran a company into the ground/ and screwed up ?how about helping the homeowners who got screwed by the loan companies that knew they were making bad loans and did so anyway?and then still get paid outrageous millions for cheating hard working people out of their homes !???????hello!!?? whats wrong with this picture???????

Dave

December 5, 2008 12:49 AM

I was employed by United Airlines when they asked Congress twice for a loan. Both times they were turned down. Well you now what followed: Reorganization, pensions turned over to the PGC, and pay concessions. I think It's time for the big three CEO's to be creative and do what they are paid for.

Pat

December 5, 2008 12:57 AM

If the union supported democratic party will not save them, then there must be a reason which are many..It is disturbing to hear the blame on management when everyone knows that the AWU has ended the american auto industry..Ridiculous wages, ridiculous layoff payments, ridiculous everything..Non Union companies are thriving, let the big three go bankrupt and come back non union..THEY WILL THRIVE

Steve K

December 5, 2008 1:04 AM

What are they going to save? The bad management of poor performing firms? What other industry would come to Washington to beg for money, after running their businesses into the ground. To bad SBA can't recommend this to small business owners.
These companies will be bought by real managers and leaders that can build up the US Auto industry. Then it can be competitive, or even win against the 9 main Japanese companies. I hate to see the market and country go through the shock of losing these big firms, but it is better than funding these losers!

Steve K.

Stock Master

December 5, 2008 1:26 AM

We can see one more fight in between Americans and Japanese. Genuine Americans and fighting for American industry, jobs, families and economy and Japanese are fighting for their self.
Richard Shelby is Japanese if you didn’t know. He changes his faith, nation and legacy. He traded himself for a hand full of dollars.

Conclusion:
Not all American born people are Americans.

Mike Smith

December 5, 2008 2:01 AM

NO BAILOUT!!! These companies have BAD management. Mulally spent $760,000 on "personal" (not business) corporate jet use. He has total compensation of $22 million. Ford also gave away free computers to its employees in 2000 when it was losing market share! Just this year, Ford gave out HUGE bonuses in 2008 even though the company is going down. NOW THEY ARE AFTER THE TAXPAYER DOLLARS???? NO WAY!

Fair Trade

December 5, 2008 9:32 AM

To Reality Check -- The US Market is a free market but the US automakers do not enjoy the same free markets overseas. We need FAIR trade policies not what we now have which are FREE trade policies here and CLOSED reciprical markets such as with all the major Asian countries. Beyond trade, how many dollars has the Japanese goverment given for US automakers to build plants in their country as Alambama and other states have done here?

bjgeibel

December 5, 2008 5:26 PM

First, Congress shouldn’t be making financial decisions for our economy. We are supposed to me a market economy not a socialist or communist one. If they have to go into bankruptcy and form a sound economic plan, they will emerge a much stronger and viable company. Also, congress can’t even manage the government like they are supposed to. They think nothing about the future of this nation and believe either that the money they barrow from China to prop up our government will be never-ending or that when our government does collapse they will no longer be in office so they won’t be blamed. No bailout for auto companies and no more corporate welfare!

Common Sense

December 5, 2008 7:17 PM

It makes me extremely upset and angry when I start thinking what mismanagement and bad bets Citi Bank have done when they needed $300 billion with almost no supervision how they are going to spend them!!?? $300 billion. I will repeat one more time, $300 billion. + $150 billion for AIG + other thief that should be in jail how for making millions of American families living life worst then in third world countries.

Why they are not lending that money back to tax payers, small business? Are they sending our money outside of country?

Why we don't have $450 billion to stop foreclosures and get the economy out of this pit and we have $450 to donate to Citi and AIG? Why they are so much important then American people?

What our president is doing letting car makers going of the cliff in situation when is very difficult to sale any car even for Honda and Toyota?

Every lost job in one of Big Three's will consequently lead to loosing 10 more jobs all around the country.

I wonder are those people who are making decisions really believe in what they are saying? and are they saying truth.

Post a comment

 

About

Want the straight scoop on the auto industry? Our man in Detroit David Welch, brings keen observations and provocative perspective on the auto business.

BW Mall - Sponsored Links

Buy a link now!