According to MSNBC.com President Barack Obama refused further long-term federal bailouts for General Motors and Chrysler. President Obama believes that more concessions are needed from unions, creditors and others before they could be approved. According to cnn. com "The federal government will give GM "adequate working capital" over the next 60 days to work in conjunction with the administration in developing a better recovery plan, Obama said." He also granted Chrysler a 30 day period to complete a merger between Chrsyler and Italian auto maker Fiat. There are two sides to this argument. Some people believe that there is no place for the government in the auto industry, while others believe the government should continue to give the industry more money to bail them out.
Below are the links to the two articles I have sited, along with the video of President Obama's speech:
http://www.msnbc.msn.com/id/29944834/http://www.cnn.com/2009/POLITICS/03/30/obama.autos/index.htmlhttp://www.msnbc.msn.com/id/21134540/vp/29957543#29957543Do you think that the plan outlined in the articles or speech can solve the problem? Do you have any suggestions for what should be done?
Do you think that the government has too much control over the struggling auto industry?
Here is clip of Jackie Mason discussing the GM bailout.
ReplyDeletehttp://www.youtube.com/watch?v=Nl_48676ioQ
Also I am copying and pasting a comment some one left on youtube regarding the video and bailout. It is point that I had not thought about. Kind of scary.
tkunk (3 weeks ago) Show Hide +1 Marked as spam Reply GM is the #1 consumer for over 6000 small companies which will disappear after GM, 200 employees per each small company on average. There are over 6500 GM dealers in the US alone. Bob Carter, the vice president of Toyota sales said, just the mention of GM bankruptcy from their auditors has put most of our suppliers credit lines in jeopardy because we all use the same suppliers. If our suppliers can't get funding to invest in product development we are all going down.Global catastrophe ITS over
I found an article that talks about President Obama's involvement with the issue. The thing I took away from the article most were the quotes. Obama states, "We cannot, we must not, and we will not let our auto industry simply vanish." He clearly thinks that he must take authority and fix the problem. The article also gives insight on the auto company's point of view. It's an interesting article, so give it a look if you get a chance!
ReplyDeletehttp://online.wsj.com/article/SB123841609048669495.html
Here's another clip which can shed some light on the issue. http://video.google.com/videosearch?source=ig&hl=en&rlz=&=&q=obama%20and%20gm%20chrysler&um=1&ie=UTF-8&sa=N&tab=wv#
ReplyDeleteIt is quite inevitable that alot of GM plants will close down in the near future. There has been considerable effort by the government to intervene and help bail out GM. It is also unfathomable that Chrysler has to consider merging with an italian auto producer. It really appears like bankruptcy is imminent for GM.
This comment has been removed by the author.
ReplyDeleteI would agree with Rob, and I also believe that any effort to save these companies would be in vain. In a free market economy businesses that are not making it on their own need to sometimes fail in order to produce a more successful business model. Although President Barack Obama has said repeatedly that the federal government has no interest or intention of running General Motors, he has asserted unprecedented governmental control over the auto industry by forcing the resignation of Wagoner. Despite the fact Wagoner may be turning out to be the public scapegoat for the failures of General Motors, the enormous growth and quiet acceptance of governmental growth is the more relevant circumstance. I am concerned that articles directly addressing the changing climate of the automotive market do not also address the growing presence and power of the federal government. By ignoring this reality, it silently accepts the rapidly changing business model in America.
ReplyDeletehttp://www.youtube.com/watch?v=E4Q0-rWXtb4
I find this entire controversy to be quite a gamble for the American auto industry. From what I’ve heard it sounds like bankruptcy is inevitable for Chrysler and GM, and no one is really sure if they can bounce back and restructure after the deadlines. I do believe that the government is taking the necessary steps in order for the auto industry to rise up, even if they may be over stepping their boundaries, slightly. One thing that I noticed about Obama’s speech was that he mentioned the used car trade-in incentives. Although I don’t know much about the auto industry and its cars sales and, I do believe the plans in Germany and Britain, which entail giving up to 3000 euros credit to people who trade in used cars for new eco-friendly cars, is the best way to get Americans to buy new and more efficient cars. Of Course Americans would have to realize the importance of buying American made cars rather then foreign, which seems to have gotten us in this mess in the first place.
ReplyDeleteI understand GM needs to do whatever possible to avoid bankruptcy, but I don't think removing the former CEO, Rick Wagoner, was really necessary. I feel like this is an issue where the shareholders must decide who is and is not fit to be the CEO rather than the government's. There is no saying that the new CEO will do better than the former. Especially since he has less experience with the company and he is coming into the job at such a hard and crucial time. Instead of interchanging the CEO's, GM and the government, since they are making themselves involved, need to come up with a realistic restructuring plan. If GM goes bankrupt, a lot of people are going to be without jobs, and it is going to take a toll on many families. Hopefully, something can be done, and the new CEO Fritz Henderson knows what he is doing.
ReplyDelete