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Obama Rejects GM And Chrysler Plans

From an elated Associated Press:

U.S. President Barack Obama announces that Edward Montgomery (R) will serve as the Director of Recovery for Auto Communities and Workers as he speaks about the auto industry in the Grand Foyer of the White House in Washington, March 30, 2009.

White House questions viability of GM, Chrysler

By Philip Elliott, Associated Press Writer

WASHINGTON – President Barack Obama refused further long-term federal bailouts for General Motors and Chrysler, saying more concessions were needed from unions, creditors and others before they could be approved. He raised the possibility Monday of controlled bankruptcy for one or both of the beleaguered auto giants.

At the same time, eager to reassure consumers, Obama announced the federal government would immediately begin backing the warrantees that new car buyers receive — a step designed to signal that it is safe to purchase U.S.-made autos and trucks despite the distress of the industry.

In a statement read at the White House, Obama said he was "absolutely committed" to the survival of a domestic auto industry that can compete internationally. And yet, "our auto industry is not moving in the right direction fast enough," he added.

With his words, Obama underscored the extent to which the government is now dictating terms to two of the country’s iconic corporations, much as it has already taken an ownership stake in banks, the insurance giant AIG and housing titans Fannie Mae and Freddie Mac.

In an extraordinary move, the administration forced the departure of Rick Wagoner as CEO of General Motors over the weekend, and implicit in Obama’s remarks was that the government holds the ability to pull the plug on that company or Chrysler.

Uncertainty about the industry’s fate sent stocks tumbling, with the Dow Jones industrial average losing as much as 300 points in midday trading

Even as he pronounced their effort unsatisfactory, the president said the administration will offer General Motors "adequate working capital" over the next 60 days to produce a reorganization plan acceptable to the administration.

He said Chrysler’s situation is more perilous, and the government will give the company 30 days to overcome hurdles to a merger with Fiat SpA, the Italian automaker. If they are successful "we will consider lending up to $6 billion to help their plan succeed," Obama said

"But we also cannot continue to excuse poor decisions," he said. "And we cannot make the survival of our auto industry dependent on an unending flow of tax dollars." …

"Let me be clear: The United States government has no interest in running GM; we have no intention in running GM," Obama said

Of course these two companies should have been allowed to declare bankruptcy and restructure (sans unions) long ago.

But rather than let that happen, Mr. Obama decided to use this crisis to grab more power and control over what is left of our capitalist system.

And to pay back his auto union supporters and financiers.

So now the US government (aka the taxpayers) are the people to go to for warranty repairs.

And more laughable still, the US government is going to decide who should run these car companies and what their business models should be.

Yes, given our government’s wondrous track record at doing these kind of things, we have nothing to worry about.

What an absolute farce.

This article was posted by Steve Gilbert on Monday, March 30th, 2009. Comments are currently closed.

24 Responses to “Obama Rejects GM And Chrysler Plans”

  1. curvyred

    Having the federal governent back the warranties really doesn’t give me more confidence – my next car purchase will be a Ford , Toyota or Honda.

    • U NO HOO

      We are buying a Ford.

      First On Race Day or Fix Or Repair Daily or Found On Road Dead?

      Whatever.

  2. David

    He said Chrysler’s situation is more perilous, and the government will give the company 30 days to overcome hurdles to a merger with Fiat SpA, the Italian automaker.

    Seems odd to me that the administration would be putting so much emphasis on a foreign take-over of a US company. Is there a way to find out if anyone behind this scheme might happen to have a bunch of Fiat stock?

  3. jrmcdonald

    Hey Execs! You better keep ‘Massa’ happy, otherwise you will have an Acorn goon squad on your front lawn.

  4. Rusty Shackleford

    And the hits just keep on coming. Just when we’re focused on one thing and trying to figure out what his mental problems are…he comes around from another angle and hits America with this.

    I wonder if he spends his weekends thinking to himself, “heh heh…this’ll really piss ‘em off” and then grinning that American Idol grin and struttin’ his bad self to the Mrs to ask permission for his latest takeover.

    The list will grow ever longer, my friends. It’s just a couple of months into the first quarter and he’s gone and done some things…Taking over one bank so far….a very BIG bank…and now…his assault on American business begins in earnest.

    Using the tactic of the typical left-wing dictator, he says, “I do this because it is apparent that GM cannot do it by itself. We have given them ample time (which means ‘we watched and waited for the right moment to move’) and money (which means, ‘we own their sorry asses, so we win;).

    And at the same time he has the unmitigated BALLS to tell America they have no interest in running GM. So let’s say a bunch of people come into my place of work, start telling me this is how to do things..and the president will be most displeased with that and so on…and fire the CEO as well….tell me that they don’t have any interest in ru(i)nning GM.

    And also….putting Chrysler on notice. “You boys bess be checkin’ it. We be comin fo yo sorry asses next”.

    What kind of events have to occur to make the MSM wake up and report what is really happening here? I suppose if they went and grabbed Katie Couric from her home and beheaded her, they would say that “Obviously, Katie had transgressed very seriously to warrant such firm action on the part of the government”.

    He’s really got brass ones this guy. And why did the CEO of GM not raise a fuss? Has he been emasculated as well as fired?

    This is a clear violation of corporate law, at least and federal law at most. Where are the lawyers? Or is it that they feel there’s no money in it?

    Note the article citing the reason why the market is down 200 points already. The real reason is because of more government takeover.

    Mr Obama, the consequences of businesses making poor decisions…is that the business goes OUT of business. Bear in mind….that you have now forced the hand of American car buyers to buy more Hondas, Suzukis, Toyotas, etc. So you may have just saved the car industry by causing us to buy elsewhere.

    And why….WHY do you think that installing a bunch of green-leaning pukes will result in better cars? Again, you haven’t done your homework. Viable, sustainable eco-friendly vehicles are not-sustainable yet. They may never be. Your idea to FORCE it to happen does not change the laws of physics.

    What’s next? Commandeering 90% of the growing fields in the US to grow CORN? Just to cover your ass so you can later say, “See? We’ve got bio-fuel…..and it works”.

    You, Obama….YOU …are an idiot of epic proportions. I may have to go out and intentionally buy a foreign car to trump your takeover of GM. And….I’ll make sure it is as unrelated to GM or Chrysler as possible.

    He keeps crossing that line….and nobody in power says a word or does a thing. Amazing.

    • Gila Monster

      Buy a Ford product Rusty. So far, Ford has stayed away from gubbamint’ money and it looks like they will continue that rather sane policy.

      Just my two cents worth but GM and Chrysler should have declared bankruptcy and rolled their financial dice in court. By taking the fed hand-out, their hands are now tied to the whims of the Obamessiah administration that will crucify them at every opportunity, at least in the realm of public opinion, as is happening now.

    • Rusty Shackleford

      Well, as it stands, I have a 1994 Ford pickup with 278,000 miles. And, a 20 year old Porsche 944. I have been pondering replacing my old F-150 with a used F-250.

      Ford will hopefully be able to weather the economic downturn. So far, it appears that their management made one of the wisest decisions in history.

      I would LOVE to hear Lee Iacocca’s uptake on this.

  5. proreason

    I can’t wait to get a trabant, made in the usa by obamy’s union thugs at taxpayer expense and forced down our throats.

    To prepare, here are the 50 worst cars of all time:

    http://www.time.com/time/speci.....45,00.html

    (try to ignore the political asides. One couldn’t expect a Time “reporter”, even one reporting on cars, to avoid injecting the corporate approved party line into even a report on toilet seats.)

  6. jobeth

    Correct me if I’m wrong, because I am not up on the intricacies of bankruptcies, but if the car makers had been allowed to do what free interprise does when it’s mismanaged…go bankrupt… the unions would have been out of the picture all together.

    Couldn’t the car makers then be allowed to restructure without the hindrance of the unions?

    If so, seems to me that would have been the answer to the whole question. A leaner car industry would have been more apt to work…as in the non-union Japanese car dealers who set up shop here in America.

    If someone knows the answer of that I would like to hear it.

    • Rusty Shackleford

      You’re absolutely correct but the history of carmakers and unions is odd. The carmakers went to Washington to grovel for money. This may have been an easier, though much costlier path than to file BK. Then, there is the propensity for UAW violence when sugar-daddy stops paying.

      This is an Obama wet dream. He just got 335,000 new federal employees.

    • jobeth

      Thanks Rusty, Sometimes I think I am living in Oz.

      You are right of course, about the Union thugs creating violence.

      My husband and I were discussing Bush bailing out the airlines, and while I remember the complaints about that (rightful complaints I might add), I don’t remember him trying to micro-manage the innerworkings of the airlines.

      This is such a scary situation. He is trying, with success, at intertwining his tenticles throughout every part of our society so that everything is dependant on the his goodwill and blessings.

      God help us.

  7. jobeth

    This is a Win-Win for Obalmy.

    Either he completely controls all aspects of our society and finances or he completely bankrupts this country for many, many years to come…weakening our country, defense, economy and quality of life….if we are fortunate enough to even have a “life” after Obalmy.

    Either way he ruins this country.

    I just can’t wait for the next elections to come about. Maybe we can stunt some of his plans.

  8. gipper

    “Let me be clear: The United States government has no interest in running GM; we have no intention in running GM,” Obama said…

    Whatever Obama says, believe the opposite.

    • jobeth

      Exactly!

      He’s ALREADY started for pete’s sake. The CEO of GM said he was “asked” to step down so he did.

      Ummm….wonder just how that question was “asked”. Perhaps, with a few union thugs overlooking the meeting….just for their edification of course.

      As Ann Colter would say….”RIIIIIIGHT”! LOL

  9. bousquem

    Watch the next thing coming out of will be a mandate that cars in the US can only be run on electricity produced by eco-friendly solar panels and wind turbines. If a company is not producing things people want and/or can’t run a profitable business then they deserve to go under or get restructured in bankruptcy court. All that is going on is a power grab by the annointed idiot in DC and a chance to pay back the unions for all their support. Watch the unions have to give up some little insignifigant amount or itme and then everyone else will get the shaft, the creditors will get told/ask/threatened to “forgive” the outstanding debts (probably under the threat of being though of as “too big to fail” and get a goverment take over coming of them). I have a 1999 ford taurus with a little over 100,000 miles on it and I’ll probably be driving it for between 1 and 5 more years if I can and depending on my financial situation. I’ll be buying a Ford, Subaru, VW, or another asian import (not chinese). I refuse to support companies that are so far in bed with obama (lack of capitalization is intentional).

  10. “As Detroit goes, so goes the nation.”

    “Four legs good, two legs bad”.

    “We have no intention in running GM”.

  11. proreason

    Gee, I wonder if 300,000 UAW workers/voters and 1,000,000+ retirees/voters might have something to do with this.

  12. Right of the People

    I have one word for a government run auto company: YUGO!

    Soon our comrades at GM & Chrysler will be cranking out quality, inexpensive transportation for the masses that run on donkey dung or some other exotic, natural fuel and helping to save the earth from the evils of our civilization. Remember to always look for the union label to be sure you’re getting 100% union made crap.

    I was planning on trading in my Cadillac on another one but now there is no way. Guess I’ll have to give Lincoln a try. Stock up on all the ammo you can get, I hope change is coming soon.

    10-7

  13. Enthalpy

    This is the harbinger of President Obama’s Health Care Plan. He or his representative has rejected your request for any heart surgery because you have not prepared properly for the operation by keeping fit as you were instructed and you have failed to reduce your weigh by the required amount. You will then be advised as to what options are remaining for you in your last days. How fortunate you are to have someone watching you and watching out for you. May His Name Be Praised.

    • jobeth

      I know you are only half kidding but you are so right. This medical thing really gets me going.

      My father-in-law (a Brit) in 2006 was denied all nourishment (just plain saline…no nutrients) for 6 weeks…yep, not kidding…6 weeks because he had the audacity to have a massive stroke at the age of 85. Of course he died. He was legally euthenized (sp?) He was declared too old and unimportant to the state. Before that he was a strong active old guy with a great sense of humor. Not to mention a war vet…who took shrapnel for the ingrates that killed him.

      Not to mention that for weeks prior he was denied care when he was having TIAs (mini-strokes). They refused to take him into the hospital when he was having the TIAs and of course ultimately he had the big one. The just kept giving him appointments weeks away, probably hoping he wouldn’t be around to keep it.

      Once in the hospital, they said “he said he doesn’t want to live”
      We asked him…his mind was quick, and he managed to say “yes, you silly booger”

      I about had a cow when I was told that the patient and family had NO SAY in how one is treated medically.

      I’ve gone over this before here, but this is our future if/when Obalmy gets is Nationalized health plan in.

      Sooo…Too old?….Too handicapped?….Inconvenient expensive treatment?

      “Too bad for you….Bye,Bye… Hope the afterlife is nice….”.”

      Grrrr…..

  14. U NO HOO

    “I would LOVE to hear Lee Iacocca’s uptake on this.”

    If you can find a better car, buy it.

  15. sheehanjihad

    “I have one word for a government run auto company: YUGO!”

    Yes! Government run anything is YUGO screw yourselves…..it’s our dime, it’s their call. We lose.

    • jobeth

      Yep, makes me want to think twice (or more) about thinking about buying anything that Obama has a hand in building!

      Today its the CEO…tomorrow it will be “put cheaper parts in, we have to cut costs somewhere and the unions won’t let me start with wages and benefits”

      Yikes…another Yugo, only this time “Made in Amerika”

  16. Confucius

    I fault Bush. He started the financing of GM and Chrysler despite everyone knowing they were insolvent. Worse yet, he used TARP money that was meant to solve the credit crisis.

    So now, how twisted is it that Obama will be the one doing what should have been done months ago?


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