House Approves US Auto Bailout, But There's No Sign Of The Fat Lady Yet

The US House of Representatives last night approved a $14bn (£9.4bn) bail-out of the US car industry. (Wasn't it $15bn yesterday??)

The House approved the rescue plan by 237 to 170, mostly along party lines.

However, the bill must now go before the Senate Republicans, where the Democrats have a razor-thin majority, who have the power to kill it stone dead.

A number of high-profile Senate Republicans have already said they had every intention of scuttling a taxpayer-financed rescue for General Motors and Chrysler.

This initial rescue package is simply seen by them as the first installment of throwing good money after bad.

General Motors and Chrysler say they risk ruin without immediate aid. Ford says it may need funds in the not too distant future.

Under the terms of the proposed package the "Big Three" have until 31 March to submit plans to the "car tsar" detailing how they intend to restructure to ensure their longer-term survival. By that time of course the money will have already been spent.

It all seems like a very strange "deal" to me, and not one that any sound and rational businessman or financial institution would want to enter into.

Try ringing your bank this morning, tell them that your business is in danger of immediate collapse. Ask for a large sum of cash upfront today, and tell them you are about to start writing a business plan detailing how you are going to turn things around. You can let them have a copy by, oh say the end of March.