Carmageddon?
The US House of Representatives could vote on a $15bn bailout of the US car industry as soon as today, according to media reports.
The $15 billion package being proposed is substantially less than the revised $34 billion that was requested for last week.
General Motors and Chrysler say they risk ruin without immediate aid. Ford says it can wait awhile, but it too will need aid before too long.
All three are quick to point out that letting them simply go to the wall would result in up to 3 million more Americans on the dole. Certainly all three also appear to have been genuinely shocked by the lack of sympathy from Congress for their plight.
Many in Congress are acutely aware that bailing out the Big Three means stepping over the line that has been drawn in the sand between financial institutions and the rest of commerce. If they step over the line then what happens next?
Only a week ago the Big Three revised their needs from $25 billion to $34 billion. That beggars a few big questions: a) are things so bad that what would have sufficed a week ago, now needs $9 billion more to save it this week? b) if so, how do we know that you won't need another $9 billion next week? c) if you do need $34 billion then surely $15 billion is simply delaying the inevitable? d) what is the criteria now exactly for qualifying for a government bailout? Can any large mismanged conglomerate have one?
The $15 billion package being proposed is substantially less than the revised $34 billion that was requested for last week.
General Motors and Chrysler say they risk ruin without immediate aid. Ford says it can wait awhile, but it too will need aid before too long.
All three are quick to point out that letting them simply go to the wall would result in up to 3 million more Americans on the dole. Certainly all three also appear to have been genuinely shocked by the lack of sympathy from Congress for their plight.
Many in Congress are acutely aware that bailing out the Big Three means stepping over the line that has been drawn in the sand between financial institutions and the rest of commerce. If they step over the line then what happens next?
Only a week ago the Big Three revised their needs from $25 billion to $34 billion. That beggars a few big questions: a) are things so bad that what would have sufficed a week ago, now needs $9 billion more to save it this week? b) if so, how do we know that you won't need another $9 billion next week? c) if you do need $34 billion then surely $15 billion is simply delaying the inevitable? d) what is the criteria now exactly for qualifying for a government bailout? Can any large mismanged conglomerate have one?
