GM, Chrysler bailouts saved 2.6 million jobs - Autoblog
Retire and move to other jobs??? what other jobs were there in Detroit in 2008 / 2009? With the GM bailout, they had unemployment approaching 15%.... with the Dow at 6000, not many were retiring.
Yes, in the long-run, things might have shaken out... but the long-run would have been much longer (look at how slow the economy is recovering with GM in tact)... and, of course, in the long-run, we are all dead. Meanwhile, in the short-run, we would have had no auto industry, US unemployment in the 12-15% range and a US debt of $20T right now.
Last edited by upsideguy; 12-10-13 at 10:58 PM.
"It's always reassuring to find you've made the right enemies." -- William J. Donovan
All the big car companies rely on the same suppliers. If 2 of the Big 3 collapsed (as would surely have happened without government support), it would have taken out the suppliers, which in turn would have taken out Ford, and the American auto industry would basically be crippled. You'd have around 1.2 million more people unemployed, with non-transferrable skills -- which in turn could have hit $28 billion in higher benefit spending and lost revenues.
Nothing you've said changes this. Actually, you've said nothing. So...
I'm talking about Asian governments, because this is the kind of thing they do, and they're who US companies compete against. And yes, it makes sense for the government to hold a bunch of stock when bailing out a big company like GM or AIG.Further we're not talking about Asian governments. Last, can you post up a few times the Big Daddy has purchased stock in a structured bankruptcy.
If that was the case, the auto execs (including Ford's CEO Alan Mulally) wouldn't have debased themselves by driving to DC in a hybrid, to beg for government help.A normal bankruptcy was an option. period.
It's also a little bit tough to have a "normal" bankruptcy at a time when the credit markets are frozen rock-solid, when no one wants to invest in anything, and when inventories were plummeting. Oh, and I'm sure Americans would be thrilled if the tattered remains of GM were bought out by, let's say... a bunch of Chinese companies. Yeah, that'll work.
Uh huh. Well, in a normal bankruptcy, it would've been the employees and the pension fund who got screwed. Bondholders got 10% of the new company, currently worth $6 billion; they also got options for another 273 million shares at $18, for another $6 billion. 50 cents on the dollar, with more upside if the stock price goes up? Plus creditors collecting on credit default swaps? Yeah, I'm not broken up over it.Creditors would not have gotten screwed as much in a normal bankruptcy. Bond holder in a bankruptcy take a hit but don't lose everything....
Is it? Is that why they have $62 billion in liabilities on their books?Last GM has also posted profits for the last 15 quarters, do you know why, a big clue. Their bond debt is gone....
Most of their losses weren't because of debt. It was because they couldn't sell cars.
If it hadn't gotten a bailout, not only would we have lost a premier industry, but the government would have lost nearly $30 billion in benefits and lost revenues.And lets not forget the tax payer lost over 10 billion bailing out GM. Yes that is 10 Billion of some of my taxes went to bail out GM, actually my tax dollars went to bailout the unions. Period.
The funny thing is, you read the critics complain about it last summer, and they were talking about "$25 billion losses" and "GM can't make a profit." 18 months later, the losses were cut to $10 billion, and GM has actually had years of profits.
Considering that we paid out $418 billion for TARP, and got back all of it except for $12 billion, and basically kept the US economy from crashing into a telephone poll, I'm OK with it.
Really. Report: GM bailout saved 1.2 million jobsReally?
Some estimates go as high as 2.6 million jobs. GM, Chrysler bailouts saved 2.6 million jobs - Autoblog