Our last stimulus package cost 168 BILLION. The money was borrowed from China! It didn't do a thing to improve our economy. We have bailed out and bailed out. Still our economy is going down the tubes at a rapid pace. Not enough credit is being given to the role the record breaking cost of gas played in the downward spiral of our economy and the demise of businesses from the largest corporations on down the line. Families and business have struggled this past year to get buy while being slammed with high fuel costs. The average family broke the budget filling up the car alone. Then to add insult to injury, every consumer product cost us more due to increased production and shipping costs. Food, clothing, everything imaginable now cost more as well. Electric companies were quick to raise prices some as high as 22%. So, we cut back, drive only when we absolutely have to , quit going out to eat. Stop buying new clothes. Sadly the ripple effect is never ending, this results in even more jobs being lost. OPEC responds to our lowered consumption by cutting production and they continue to cut and will do so until they get the price per barrel back up. We need to end our dependence on foreign oil. We have so much available to us in the way of FREE energy sources such as wind and solar. We have modern technologies such as hybrid and electric plug in cars. Why don't we invest in America becoming energy independent. 168 billion would go a LONG way towards getting some of these things set up. We are using oil at the rate of 2x faster than new oil is being discovered. World demand is rising as 3rd world countries become more modernized and populations explode. Jeff Wilson has a new book out called The Manhattan Project of 2009 Energy Independence NOW. President elect Obama needs to read this book and provide every elected official one. We can't continue to bury our heads in the sand. We have the knowledge, we have the technology, what we seem to lack as a nation is a plan. www.themanhattanprojectof2009.com

I am not sure why we need to bail out the US car makers...they have been building really crappy cars for longer than I can remember, they are over bloated with expenses...and they still insist on building crappy cars!

I feel really badly for the people who have worked for these companies, and have so much to lose...but maybe the time has come to say goodbye. Perhaps if the big three would study the quality of other car makers (Toyota, VW, Honda, Nissan...c'mon Hyundai is even building a better car than the big three...and that is embarrassing).

Quit building plastic rattleboxes that are worthless before they are even close to being paid off, then perhaps they would not be in this bind...and perhaps we Americans could honestly state "we are proud to buy American" (cars).

Why should we pay the bill for their stupidity, and their inability to build a better product? They are only going to keep losing money, and eventually go belly up anyway (and take all of the tax payers money with them when they go down).

We are only prolonging their death, so I say pull the plug!!

To : Thomas,
The mushroom effect of your well thought out plan has a rambling destructive path
not with just domestic havoc, but global
ramifications as well. Many more lives will become adversely affected. It does appear, from my vantage point, The Big Three, has failed to recognize market saturation by others for a number of years. Why were they (BIG 3) willing to surrender market share so easy ?
Could there be an untold saga that you and me missed ?
DOES THIS PROVE MUCH THE SAME WITH
OTHER AMERICAN INDUSTRY ? NAMELY :
TEXTILE, STEEL, SHOES, ELECTRONICS. THE LIST GOES ON AND ON AND ON.
TAG IT GLOBLIZATION !
THIS DID NOT START AS SOME WOULD LEAD YOU TO BELIEVE AT THE ONSET OF
THE CURRENT ADMINISTRATION.
EACH OF US SHARE IN THIS DAWNING OF A NEW DAY. UNCHARTED WATERS.

Our "Big 3" and the UAW seem to thing we are all idiots. Why should we buy something that they can't even assemble properly or that is inferior in design, construction and durability to cars, also made by American's, but using foreign design, manufacturing techniques and creativity. A bail out will not save the failed management and labor practices of the "Big 3" and in the long run will cost our country much more than would allowing these companies to go bankrupt and re-structure themselves. And government management of the resulting mess will only exagerate our losses. If anyone thinks this bail out move will help our economy (other than preserving some jobs short time) they are sadly mistaken.

It is difficult to take someone seriously when they say something like "the UAW seem to thinG we are all idiots." If that is not an ironic statement, I do not know what is.

This was a very good summary of the Chrysler Loan Guarantee, and applicable to today's situation. There was only one fact missing. Not only did the Loan Guarantees not COST the government anything, the US MADE money from stock warrants in excess of $300 million and millions of jobs were saved for a generation, resulting in countless millions in taxes to federal, state and local governments and providing good jobs to not only direct Chrysler employees but the many indirect jobs that are dependent on this company. The difficulties of this industry start with the uneven playing field that it has tried mightily to participate in for years. First, against the Japanese, who were heavily supported by their government, next by the Koreans who depend on exports yet have a nearly hermetically sealed market and soon, the Chinese will be getting into the act. It's time for the US Government to step up to the plate and pay for the years of neglect to this vital industry.

Peter, I would like to point out some flaws within your article.

The Chevrolet Volt is absolutely NOT going to save GM, they have already stated that at whatever price it comes out at (i predict $36,990) it will be a loser in terms of $ for GM.

I would MUCH rather introduce you to the Chevrolet Cruze. The Cobalt replacement that will be built in Lordstown and is supposed to get over 40mpg, easily making it the MOST FUEL EFFICIENT vehicle in its class. This is GM's saviour, you can ask ANYONE at GM what car will change GM, and they will say the Cruze. It is what the market wants, and it has everything that it needs to overtake the Civic, if only GM can survive that way.

Actually you briefly touched on the real reason why chrysler was turned around and that was because of the leadership that Lee Iacocca gave them.

One thing that we are forgetting here, and I am NOT advocating that we bail them out, although I think a loan is something that I would be willing to consider.

We are forgetting that our corporate and political leaders are offshoring the American consumers jobs and believe me, it is much worse then you have been told and I wish I could force the corporations to give me accurate numbers to back this up.

But my point is, that when 70% or more of any retailer, manufacturer or raw material producers sales come from the American consumer and you put the American consumer out of work, or significantly reduce their wages, it is going to directly affect the bottom line of ALL retailers, manufacturers and raw material producers and it is only a matter of time before the situation gets dramatically worse if we don't do two things:
1. Give me links to the Companies and CEO that are sending American jobs offshore and sending their assets offshore so that they don't have to pay their fair share of the taxes that are necessary to run our national budget
2. Immediately start bringing our jobs home and our consumers will start buying again.

I know for a fact that if I had a job, I would like to have a chevrolet extended cab, short wheel bed and a harley fatboy and a pool table and a hottub and a nice flatscreen and surround system.

If I am only one person and I would like all of that, imagine what putting 20 MILLION people back to work will do to our economy.

Help me spread the word about this site and give me more names for the "Wall of Shame"

Virgil
http://www.KeepAmericaAtWork.com

The North American way of thinking at the top for the last few decades has been short term gain at the expense of long term viability. This is why so many once great and innovative companies have been sold off to foreign interests and left the country. The leadership at the top of the Big Three and big business wants more and more money, not for the company but themselves. The Ceos and board members are getting richer and of course a bit of money is directed to the shareholders to keep them happy and on board. When companies are "losing" money in the amounts reported, the guys at the top should be fired not given multimillion dollar salaries and bonuses. With thousands of workers losing their jobs due to arrogance and mismanagement by these people they should be going to jail. Yet, they are set for life after a few years of outlandish salary and seem untouchable. Given the choice between firing one bad Ceo or 200 front line workers why are we not saving the 200 workers, the spin-off jobs and thereby the communities and turfing the bad apple?
Lets not forget that most of the losses these companies are reporting are on paper and are nothing more than creative bookkeeping. If they make a billion dollars less net profit from the year before they have the nerve to state they lost a billion dollars! If their projections are lower than expected sales are off and they justify cuts.
Any moneys directed to the Big Three and the banks for that manner should be conditional on the firing of the people at the top who through greed and refusal to conduct sound business practices have created the current situation.
Lastly the government needs to reign in the oil companies who are undermining the very livelihood of the nation with the excessively high prices we are forced to pay for gas and heating oil. How many billions of dollars profit do these companies need? What is the chance the government will put the needs and interests of the people over the tax revenues it receives from high fuel prices? Will the government ever be a government by the people for the people or ever remain funded by Big Business for Big Business?

first off the person that wrote this article is only part right. the money for the bailout was not approved until after the election in 1980 after reagan got elected not jimmy carter because their was a lot of discusion that he and the republicans wouldn't do this. but he did. next one thing that you forgot was chrysler and gm were competing for the military contract to build the m tank with chrysler version fo the m1 tank haven been chosen. it did not make sense to let this automobile company to go under and destroy the pentagons weapon system. the money was approved chysler sold the tank division to general dynamics to raise cash and started producing the k car which the federal and state and local governments were encouraged to buy. this help turn the company around this reporter should get his facts straight before writing a story something he obviously neglected.

I do not agree with the premise that the Chrysler bailout was successful. It only prolonged the agony for nearly 30 years with the UAW continuing to ignore economic reality and incompetent management remaining in control. Had Chrysler gone bankrupt, the picture would have forced a much higher degree of realism in the industry as to what might be afforded in the long haul. This action only helped to the extent it facilitated the entrance of Honda and Toyota and others to penetrate the U.S. market. At least they listen to their customers and manufacture reasonable and reliable products.

Mike , No matter what Cruz GM introduce, what we need here for GM to provide is a strong R&D. A car that last with very little maintnance like the one Toyota and Honda built. I thought GM will built a study Saturn. It was good the first year when I bought one. the next Saturn I bought always require maintenance. So how can you bailout a company that turn junk car.

It seems Bob may work for a Jap company making a living wage only because of the UAW.Let the big 3 fail and see what Bob gets for pay LOL!!

Bob, I guess you think janitors deserve to be paid 40 dollars an hour at GM is a living wage LOL. 70 dollars an hour to bolt screws into cars. Yeah, that's really competitive! You're an idiot!

The point of the original article is two-fold. First, to say loans to teetering auto companies can work. Second, to underscore that possibility requires focused, good leadership at the top of the company.

Chrysler's 1979 loan was repayed. This is significant because we're talking about a bridge loan for the Big 3, not a bailout.

While the Big 3 certainly have issues, they've been making strides and the UAW has been participating. Enough on both sides? I don't know, but is it worth 3 million jobs?

Anyone live in a town where a major employer just closed up shop? Anyone have a friend, neighbor, or relative who got laid off or fired because the employer down-sized or moved? The potential job losses at stake with one or more of the Big 3 going belly-up is huge: 1-3 million. If that happens, the current recession will last for years. Walmart doesn't have enough low-paying, part-time jobs to put 3 million people to work. So, like it or not, we need the Big 3 right now for the sake of our economy.

Few people batted an eye regarding the $700 billion bailout for Wall Street banks. In 5 business days, not only was that a good deal, but the Senate stacked another $100 billion of pork on top of it. But a $25 billion loan to the auto industry? Why such wailing and gnashing of teeth? I'm confused. $700 billion is ok for an industry that created the current economic crisis through greed and questionable practices gets $700 billion even though it makes no real product. But an industry with tangible products and manufacturing plant shouldn't even be allowed 1/28 of that in the interests of 3 million jobs? Seems penny wise and dollar foolish to me.

I see a lot of guys with pony tails that apparently still think they're in the 1960s. Several comments here seem to be coming from people still stuck in the 20th century. Take a look at J. D. Power's initial quality ratings. Mercury is 6th and Ford is 8th in overall quality. Others in the top ten are predominantly luxury brands: Porsche, Infiniti, Lexus, Mercedes. Toyota is 5th and Honda 7th. Cadillac, Chevrolet, Pontiac, Lincoln, and Buick all come out ahead of Acura, Nissan, Volvo, BMW, Volkswagon, and Suburu. Time to stop already with the "crappy cars" whine. That's so passe.

Bailing out the car manufacturers is equivalent to placing a band-aid on a terminally ill patient. Sherry's post on 11/15 goes into detail about what the average American has lived through this year and I believe with the way this whole situation is being handled it is only going to get desparately worse. Rick Wagoner's "sacrifice" to say he will work for a dollar for the entire year makes me laugh in anger. What has he earned per year up until now?! The interest he earns from what he has stockpiled is more than the average American earns in five to ten years. Take note that he has not mentioned giving up his pension in order to save what means so much to him. All that money and he is still not intelligent enough to realize that the average American is still not going to be able to buy their cars when we don't have any money due to job losses. Every cent of that money needs to be distributed to the average Americans. The only way out is for our bills to be paid. It's a ripple effect that would help everyone, including the car makers. Chrysler's last bail out request in 1979 may have worked for a short time, but they realized it took a long time to pay off those loans and they don't want to do that again. They want a hand-out. The car makers and insurance companies (AIG) are like the bums on the street corners with can in hand saying they will buy food, but instead buy liquor and end up on the same corner with the same can the next day.

John E Gibbons:

The Chrysler loan guarantee of 1979 (please don't call it a bailout - that implies the money did not get paid back) was successful. The money was paid back ahead of schedule, with interest, and the government made a nice return on the investment.

As like any loan given by a bank, its success or failure only depends if it is paid back and the terms are met.