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Hoo-ray for Obama: No to GM and Mopar Bailout
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President Obama got this one right. He is saying "no" to auto giants GM and Chrysler who have come asking for more money. According to the White House, the plans the GM and Chrysler submitted were "unacceptable."
The President did come short of demanding immediate payback of the funds received thus far, indicating that an immediate callback of funds would plunge the automakers into bankruptcy needlessly, since they do not have the funds available to pay back the loans.
In addition, Obama has asked GM Chairman and Chief Executive Rick Wagoner to step down.
In other posts I have said that the dinosaur auto makers need to figure out a way to survive or they need to go away. It's not what folks want to hear, but it's critical that market forces be allowed to drive the economy. The vacuum left by GM and Chrysler will be filled by other businesses. I'm not saying there won't be hard times, but those times will pass, and in the end we will have a stronger economy and future.
Part of this new auto plan is to give GM 60 days to restructure while being funded for basic needs. The government will back auto warranties during this period.
The government will also provide support to communities that are affected by plant closures.
These are tough times. Yes, it hurts. But it is time to move on to something better.
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