Why another GMAC bailout is (especially) bad for America

Posted Oct 28th 2009 10:10AM by Zac Bissonnette
Filed under: Scandals

The Wall Street Journal reports (subscription required) that GMAC Financial Services Inc. (NYSE: GKM) is seeking a third round of bailout funds from the Treasury Department ranging from $2.8 billion to $5.6 billion. This is, the WSJ writes, "a stark reminder of how some battered financial firms remain dependent on government lifelines."

Here's what is so incredibly so screwd up about this: GMAC provides financing for car buyers. Any personal finance expert will tell you that borrowing money to buy a car is one of the dumbest things that you can possibly do.

By shoring up GMAC's capital structure and therefore its ability to continue making car loans, the United States government is providing the means for Americans to get themselves into horrible financial situations.

That's unconscionable and it's immoral.

Our elected officials are now pitting the health of the auto industry against the financial well-being of families all over the country, and they're doing it under the guise of helping the economy.

News flash: in the long run, using taxpayer dollars to finance financial overextension will not lead to prosperity.

Tags: bailout, featured, gkm, GMAC

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Reader Comments (Page 1 of 1)

10-28-2009 @ 10:40AM

Phil said...

Hey Zac , tell that to wall street banks and AIG. The under the table funding of these places are a joke ! But then all of wall street is a joke. One day home sales are up? And the next day foreclosure rates are in cities not seen in yrs. LOL A clue for you and all the ANAL-YST out there. Unemployed people with NO MONEY BUY NOTHING in a 2/3rds consumer economy in the USA you fools ! Do any of you idiots get it ? Or has your anti union republican miss information got to your brain ? Like Mcintyre you fools spout off on pure BS. And hate anything American !

11-06-2009 @ 3:10PM

nomoedoughhics said...

I wouldn’t buy a GM car if they were selling new Caddies for $100. They have taken my money without my permission or consent. Let Obama and those fools in Congress buy their cars and big limo’s. They just bailed out GMAC to the tune of 6 BILLION more, and there isn’t a thing we can do about it. When this country finally goes bust there will be a revolt and then we will see who is in charge again.