Jump to content
Sign in to follow this  

URGENT: Stop the Auto Bailout

Recommended Posts

December 10, 2008

Dear fellow Patriot,

Just as we promised, Congressional leaders weren't content with

their $700 billion bailout this past fall and are ready to pass

another one -- this time for the American automotive industry.

Visit our activist Liberty Blog at

http://www.campaignforliberty.com to learn how you can help fight

this round of government theft and wealth redistribution, or just

keep reading.

In the agreement just formulated earlier today by Congressional

Democrats and the White House, our government has pledged to

wrest another $23 billion away from taxpayers to subsidize the

inefficiency and reward the poor management and performance of --

count them -- one, two, three giant corporations.

But that's not all.

More intervention like this means greater government oversight

and regulation -- and more inflation as the government prints and

spends even more dollars.

As one economic thinker once reflected, a subsidy may be a form

of establishment, but it's really a means of capture.

Even if the bailout passes the house, we have a chance to muster

some opposition in the Senate.

Using the contact information provided on our website, tell your

Senator to support the Ensign filibuster. While you're at it,

thank Senator Ensign for standing up to Big Labor and Big


Auto Bailout Looming

It looks like the White House and Congressional Democrat

leadership have reached a deal on the auto bailout, although

there aren't very many details at this point.

Plans for a "car czar" seem to still be included as part of the

deal. So, not only will your money be spent for the bailout, it

will be used to pay a new government appointee, staff his office,

and take care of the other requirements that come along with that

job. (It also gives them one more person to shift the blame to

when the problems continue.)

All of this is being done again, of course, out of "necessity,"

we are told. Just like buying up all the toxic assets was a

"necessity" until the Treasury got the money and decided to spend

it on everything but. This is what happens when the majority of

Congress is not guided by any philosophy other than the one that

says that government can cure all of our ills with just a little

more money (or billions more).

A vote could come at any time, with signs pointing toward later


To keep reading for up-to-date news on the bailout, sample

letters, and yourrepresentatives' contact information, visit

C4L's blog at http://www.campaignforliberty.com and take action

right away.

If you haven't already done so, please bookmark our website

www.campaignforliberty.com for real-time news updates and

discussion regarding our shared freedoms and liberty.

For liberty,

John Tate


Campaign For Libety


                                               Look at the flowers

Share this post

Link to post
Share on other sites


Bush OKs $17.4B bailout of the auto industry

WASHINGTON – Citing danger to the national economy, President Bush approved an emergency bailout of the U.S. auto industry Friday, offering $17.4 billion in rescue loans in exchange for tough concessions from the deeply troubled carmakers and their workers.

Allowing the massive auto industry to collapse in the middle of what is already a severe recession "would worsen a weak job market and exacerbate the financial crisis," Bush said. "It could send our suffering economy into a deeper and longer recession. And it would leave the next president to confront the demise of a major American industry in his first days of office."

President-elect Barack Obama, who takes office a month from Saturday, praised the White House action but also warned, "The auto companies must not squander this chance to reform bad management practices and begin the long-term restructuring that is absolutely necessary to save this critical industry and the millions of American jobs that depend on it, while also creating the fuel efficient cars of tomorrow."

Stock prices rallied on Wall Street as investors cheered the government's action. Republicans on Capitol Hill, though, expressed disdain for the bailout. And while the United Auto Workers said the plan would keep factories running, the union said it was upset by loan conditions "singling out workers."

"We will work with the Obama administration and the new Congress to ensure that these unfair conditions are removed," said Ron Gettelfinger, president of the UAW.

Obama will be free to reopen the arrangement from the government's side if he chooses, an administration official said.

Bush said, "The time to make hard decisions to become viable is now, or the only option will be bankruptcy. The automakers and unions must understand what is at stake and make hard decisions necessary to reform."

Some $13.4 billion of the money would be available this month and next — $9.4 billion of it for General Motors and $4 billion for Chrysler LLC. GM is slated to receive the remaining $4 billion in loans after more money is released from the financial rescue account.

Under terms of the loans, the government will have the option of becoming a stockholder in the companies, much as it has with major banks, in effect partially nationalizing the industry. Bush said the companies' workers should agree to wage and work rules that are competitive with foreign automakers by the end of next year.

And he called for elimination of a "jobs bank" program — negotiated by the United Auto Workers and the companies — under which laid-off workers can receive about 95 percent of their pay and benefits for years. Early this month, the UAW agreed to suspend the program.

Treasury Secretary Henry Paulson said Congress should release the second $350 billion from the financial rescue fund that it approved in October to bail out huge financial institutions. Tapping the fund for the auto industry basically exhausts the first half of the $700 billion total, he said.

If the carmakers fail to prove viability by March 31, they will be required to repay the loans, which they would find all but impossible. A firm will be deemed viable only if it can show positive cash flow and can fully repay the government loans.

General Motors Corp. CEO Rick Wagoner said in Detroit that GM had much work ahead but he was confident it could reinvent itself with the government help and even lead an economic recovery in America.

House Republican leader John Boehner called the administration's plan "regrettable." He said that granting loans for automakers was never the intention when Congress passed the $700 billion plan to rescue financial institutions and that the new plan "has failed both autoworkers and taxpayers."

Rep. Jeb Hensarling, R-Texas, chairman of the congressional oversight panel for the Wall Street rescue program, decried the decision, saying a Chapter 11 reorganization, not loans rewarding decades of mismanagement, would have been a better decision.

"Unless union contracts are renegotiated, and unless demand picks up for domestic autos, $14 billion, $34 billion, $74 billion — even $104 billion — will not solve the problem," Hensarling said. "I fear that a devastating precedent has been set that the federal government will now be pressured to bail out every failing company in America — something that taxpayers and future generations cannot afford."

Under terms of the loan, GM and Chrysler must provide the government with stock warrants giving it the option to buy GM and Chrysler stock at a specific price. In addition, the automakers would be required to agree to limits on executive pay and eliminate some perks such as corporate jets.

Paulson, who plans to discuss the deal with congressional leaders and Obama's transition team in the near future, said he was confident that the Treasury Department, Federal Reserve and Federal Deposit Insurance Corp. have the resources to address a significant market crisis if one should occur before Congress approves the use of the second half of the rescue fund.

Friday's rescue plan retains the idea of a "car czar" to make sure the auto companies are keeping their promises and moving toward long-term viability.

The short-term overseer will be Paulson. But the White House deputy chief of staff, Joel Kaplan, said that if the Obama team wants someone else installed to bridge the administrations, Bush is open to that. Kaplan said there have been discussions with Obama's aides throughout the process and the White House believes Obama's view of the problem and the solution tracks with theirs.

The White House package is the lifeline desperately sought by U.S. automakers, who warned they were running out of money as the economy fell deeper into recession, car loans became scarce and consumers stopped shopping for cars.

The carmakers have announced extended holiday shutdowns. Chrysler is closing all 30 of its North American manufacturing plants for four weeks because of slumping sales; Ford will shut 10 North American assembly plants for an extra week in January, and General Motors will temporarily close 20 factories — many for the entire month of January — to cut vehicle production.

Chrysler CEO Bob Nardelli thanked the administration for its help.

In a statement Friday morning, Nardelli said the initial injection of capital will help the company get through its cash crisis and help eventually return to profitability. He said Chrysler was committed to meeting the conditions set by Bush in exchange for the money.

Ford President and CEO Alan Mulally said his company would not seek the short-term financial assistance but predicted the aid would stabilize the industry.

"The U.S. auto industry is highly interdependent, and a failure of one of our competitors would have a ripple effect that could jeopardize millions of jobs and further damage the already weakened U.S. economy," Mulally said.


Share this post

Link to post
Share on other sites
Sign in to follow this  

  • Create New...