Playing chicken with 3 million jobs
Another installment of the U.S. Treasury’s bailout is underway for Citigroup Inc., a financial services giant that is considered too big to fail.
While Citigroup waits for another injection of $20 billion and help offloading a portion of its toxic financial assets, Detroit’s automakers are still fending off bankruptcy without any federal assistance in sight.
Perhaps the car makers should rebrand themselves as banks with sideline automotive production businesses and resubmit their requests for emergency relief funds.
The ruse just might work because the Bush administration has established a pattern of responding to the troubled economy by throwing tens of billions of dollars at large banks without asking how the taxpayer’s money will be spent.
The automakers are likely to find more sympathy from Barack Obama’s incoming administration, but there are growing doubts that General Motors Corp. will stay in business until the president-elect’s inauguration on Jan. 20.
Democrats in congress are doing themselves a disservice by adhering to a double standard that provides easy relief to a group of nine banks and holds higher standards for the automotive companies, which were asked to slash executive salaries and present comprehensive turnaround plans.
Congress is essentially playing chicken with three million jobs, and the Democrats have a lot to lose if GM declares bankruptcy by yearend and casts a huge pall over Obama’s first 100 days in office.
Congress will eventually ride to the rescue for Detroit. The only questions are when will the relief come and how much will it cost?
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24. November 2008 at :
This administration is not going to spend any money to provide relief for working people who produce things. The banks that they are rescuing are doing nothing to get us out of the mess that they put us in. This is all about unbridled greed, not creativity or new banking products. I propose that we follow the Keynesian philosophy as suggested in the essay just below this one on the line. There must be massive government spending, but this will not happen until George W. Bush and his minions of evil are back in their home states, in George’s case, clearing bush on his property. As to Cheney, it is obvious to me that when he leaves he will go back to Hell in the crevice in the earth that will open on January 20, 2008. As to t he rest of them, they will probably turn into gypsy moths and flutter away into the trees.
One fellow in the line of a NY Times column remarked that the morality that the Bush Administration was talking about was completely phony. Well, I’ll go him one better. Kaiser Souzay says in “The Usual Suspects,” that “the greatest thing that the Devil ever did was to convince the World that he didn’t exist.” Well, the most fantastic thing that Bush ever did was to convince the Christian Evangelists that he was one of them.
24. November 2008 at :
I’m not certain why we need to bail them out. In this instance, there is no giant lending crisis that will follow, which is why we bailed out Wall Street. The fallout from this is the potential loss of jobs, but I’m dubious. In bankruptcy, these companies can emerge with better labor agreements and balance sheets. Why would we avoid that?
25. November 2008 at :
I don’t understand why the oil companies that make record profits year after year, and are essentially kept in business by auto manufacturers, don’t bail out Detroit.