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The airlines are subsidized partially by the government. Would you like for all of them to go under? What does your party tell you to think about that?
I haven't seen a PanAm plane in along time, or National or Piedmont or any of the 11 airlines that have gone out of business yet, there are still plenty of them to choose from if you want to fly.
Can we get just a little bit of nuance into this discussion?
The auto industry needed help. It got it. That is a good thing.
Here is a partial list of the things that were not so good, in the fine points:
1. GM bondholders were absolutely screwed in favor of the union benefit plans, contrary to the rule of law.
2. Chrysler secured creditors were screwed, again in favor of the unions, contrary to the rule of law.
3. Taxpayers got nailed in order to preserve the FULL retirement benefits of retirees as young as 48 years old--instead of letting the retirees hit the PBGC benefits, where younger retirees and higher-dollar retirees would have taken a haircut.
4. The companies remain yoked to pre-bankruptcy union retirement promises that have historically ALWAYS been modified in bankruptcy.
5. The union labor contracts, which virtually ALWAYS get thrown out completely in bankruptcy, were left in place so that older workers could continue to be paid twice the market value of their labor.
6. To compensate GM for carrying so much union deadweight out of bankruptcy, the government gave them tens of billions of dollars in future income tax forgiveness--another cost to taxpayers.
But I'd also like to say, GM is thriving and will survive and I have made a fortune in their stock with more gains to come. Thanks, TARPmeisters! Thanks, President Obama! Thanks, fellow taxpayers!
I have a friend who retired from GM 10 years ago and STILL gets a Christmas bonus. Go figure.
I just hope a lesson is learned.
We can never bailout a failed company again.
There's front door and backdoor bailouts.
General or special purpose foreign aide doled out by the U.S. is used to buy U.S. manufactured weapons, equipment and big pharma which keeps U.S. people employed.
The entire defense industry is dependent on the government money for their jobs.
The Defense Department's annual budget pays for over 3.1 million employees, both military and about 800,000 civilians. Another 3 million people are employed by the defense industry both directly, making things like weapons, and indirectly, such as working in local businesses supported by a contractor's location.
It's big money and job figures that make lawmakers fight for defense contracts in their districts and defense contractors lobby Congress for their contracts.
I can understand bailing out GM and Crysler to save the last good paying jobs in the US but why in Hell did we bail out AIG and the other failed Wall Street financiers?
"to save the last good paying jobs in the US". Talk about mis-informed!
The company’s CEO lobbied for the TARP, as Ford feared that a collapse of GM and Chrysler at the time would have hurt suppliers and, in turn, Ford itself. Ford Chief Executive Officer Alan R. Mulally also asked Congress for a “credit line” of up to $9 billion in case the economy worsened. In other words, Ford was for the government bailout of GM and Chrysler.
I seem to recall that the Big Three U.S. Auto Makers descended on DC to ask for a bail out.
DETROIT (AP) — General Motors stock would have to sell for $95.51 per share for taxpayers to break even on bailing out the company, according to a government watchdog's report released Wednesday.
That price is about three times what GM shares are selling for now, even after a 25 percent increase in the price so far this year....
Taxpayers are still $18.1 billion in the hole on the $49.5 billion bailout, including interest and dividends, according to the report.
If the government sells its remaining shares of GM for the current stock price of $36.61, it would get just over $6.9 billion, meaning taxpayers would lose about $11.2 billion on the bailout.
I haven't seen a PanAm plane in along time, or National or Piedmont or any of the 11 airlines that have gone out of business yet, there are still plenty of them to choose from if you want to fly.
I used to fly Piedmont out of Charlotte. They were bought up by USAir.
Most people fail to realize if GM went under a good percentage of their vendors who supply parts to Ford, Toyota and the other mfgs would have gone under too. It would have made a bad situation worse.
The only ones who may have gained in 'the short run' would be Japanese and German employees of their Auto companies until Americans were all out of work and could not afford to buy their cars any longer.
Great-So the taxpayers get to absorb the losses without reaping the rewards of the profits.
Government loses GM wins. How is that beneficial?
The only reward to the taxpayer if the Federal Gov't sells shares at any profit is that much lowered National Debt. And when it comes to National Debt, $100B is a rounding error. So it's a feel good exercise, as nothing is returned to the taxpayers.
Secondly, if the Federal Gov't sells a share at a profit, that means that someone or some entity in the private sector has to pay that much more per share. That is money taken from the private sector and placed into a Gov't that does not need or use the money. See the above. Subsequently that added cost is like that much more tax taken from the private sector. And that much less private sector capital gains when it sells its shares down the road.
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