Boy, this ought to really help Chrysler negotiate a deal with Italy's Fiat corporation. emphasis mine.
The administration's auto task force agreed to provide Chrysler with short-term aid for the next 30 days as the automaker works to complete a tie-up with Itay's Fiat SpA and said it would consider loaning the partnership up to $6 billion if a deal can be finalized.
But it warned that if Chrysler and Fiat cannot come to terms on a partnership, the Auburn Hills automaker would not get any more taxpayer money -- a move that would likely force the company's liquidation.
But, but, but... the brain drain. They had a contract. Wall Street destroyed the world economy, and they got unlimited taxpayer money, bonuses, and jets.
At GM, the Obama auto team forced out CEO Rick Wagoner. The task force also disclosed that the automaker planned to replace a majority of its board of directors in the coming months. The Obama auto team said it would give GM unspecified working capital for 60 days as the automaker continues to restructure.
Surgical, oooh.. Sort of like the smart bomb. It will minimize collatoral damage (assets) while blowing up the enemy, unionized American workers.
The government raised the possibility that a bankruptcy filing may be GM or Chrysler's "best chance at success" -- but emphasized that it would be a short-term "surgical" bankruptcy and would be undertaken with the government's support.
Old liabilities. He means the retirees, and their pensions and health care. You know, the stuff they earned over 30 years through - yep, you guessed it, CONTRACTS.
"Unlike a liquidation, where a company is broken up and sold off, or a conventional bankruptcy, where a company can get mired in litigation for several years, a structured bankruptcy process -- if needed here -- would be a tool to make it easier for General Motors and Chrysler to clear away old liabilities", the government said in a fact sheet outlining the task force's findings.
The country's unemployment rate, Michigan's 12% in particular, isn't high enough to satisfy the Obama administration. Wall Street stole and/or destroyed everything in site and kept their jobs and our money. GM and Chrysler simply didn't stay competitive enough (with $3/day labor), particularly during the WS caused economic meltdown, and the American jobs they provide got fucked. Sure proves my dad right. If you are going to steal, go big or stay home. If you get caught, you need to make damned sure it is worth it.
The task force said GM's plan to close, shrink or sell four of its eight brands didn't go far enough. --snip--
It also disclosed that Chrysler plans to close two assembly plants and five engine plants by 2014 and reduce its structural costs by 29 percent by the end of this year from 2007. Chrysler's total salaried headcount will fall 60 percent by 2010 over its 2000 level, the government said.
With friends like this, who needs enemies.
The tough medicine in the plan shocked Michigan members of Congress. President Barack Obama held a 30-minute conference call Sunday night with Michigan's two senators and its two senior House members. Michigan members held conference calls late into the night trying to figure out a response but held off at the White House's request.
McCotter is an ass, but this time he has Obama nailed.
Rep. Thaddeus McCotter, R-Livonia, said the announcement "sends a very ominous signal that this administration believes the existing viability plans aren't painful enough."
"What is their definition of 'significant restructuring?' How many more jobs must be lost? How big a hit do the retirees have to take?"
McCotter complained that there was a double-standard in forcing Wagoner to step aside while allowing bank CEOs whose companies have received billions in aid to remain in place.
We don't want your damned welfare. We want the manufacturing jobs Daddy Bush, Bill Clinton, Republicans and Democrats have been destroying with their crappy trade deals and support for offshoring.
The Obama administration is also appointing a director of Auto Recovery. Edward Montgomery, a top labor economist and former deputy labor secretary, will serve in a new position as director of recovery for Auto Workers and Communities, with a goal of working "to leverage all resources of government to support the workers, communities and regions that rely on the American auto industry."
OK, here it is, as predictable as a clock is right twice a day. Everybody has to sacrifice but...Wall Street.
"And that's going to mean a set of sacrifices from all parties -- management, labor, shareholders, creditors, suppliers, dealers," Obama said. "Everybody's going to have to come to the table."
From Open Secrets, Obama's top donor list is pretty interesting. It could explain his love affair with Wall Street, Ahnold, and data collection.
University of California $1,385,675
Goldman Sachs $980,945
Microsoft Corp $806,299
Harvard University $793,460
Google Inc $790,564
Citigroup Inc $657,268
JPMorgan Chase & Co $650,758
Stanford University $580,904
Sidley Austin LLP $574,938
Time Warner $547,951
National Amusements Inc $541,251
UBS AG $522,019
IBM Corp $518,557
Skadden, Arps et al $510,274
Columbia University $503,566
Morgan Stanley $490,873
US Government $479,956
General Electric $479,454
Latham & Watkins $467,311
He will, of course, be having his big press conference on this today. I don't expect much, if anything, to change. It will be too bad, so sad, and get the fuck out of here. It isn't hard to see the path to higher unemployment and foreclosures that he charted with this plan. Bailing out Wall Street and mainitaining the wars on Iraq, Afghanistan, and drugs are failures worth rewarding and black holes deserving to be filled with taxpayer bucks. If rewarding Wall Street's failure doesn't do it for you, think KBR and Haliburton.
News reactions in SE MI to Obama's speech:
*You can't incentivize people who are terrorfied of losing their jobs, and $1,600 isn't even close.
*Deep structural cuts can't meet time lines and will have huge financial costs. Question ROI.
*Stalemate between unions and bond holders. GM owes money to bond holders for interest and union for VIVA. GM wants to pay union .50 cents on the dollar (been sacrificing for a long time), and bond holders .30 cents on the dollar and make up the difference in stocks. Bond holders are balking, and unions are hanging tough. If no breakthrough, GM will enter into bankruptcy.
*Firing Wagoner and leaving the bank CEOs in place is an outrage. This wasn't even a bailout, it was a loan.
*GM has no power to force anybody to do anything IF it doesn't go into bankruptcy.
*This will have world wide impact.
Update: There are several comments about the donor list being OT. If I hadn't of witnessed Obama's about face with my own eyes, I would agree with you. MI and OH followed his every word when he campaigned in our states. Autos are
a huge "the" deal to us. He promised, over and over, to renegotiate trade and to save auto and manufacturing jobs. Given his retreat on renegotiating trade, buy American, and taxing companies that offshore jobs, there is no conclusion other than he lied pandered to people in MI. If he pandered to us, the question is "who else". Maybe the list offers no clues, maybe it does.
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