Word: gm
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Dates: during 2000-2009
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...GM. It has taken government money and made it clear that a great deal of the cash has been wasted. Even with the evidence of that completely uncovered, the Administration has so little power that it cannot let AIG go under, as a punishment for taking taxpayer money and using it for multimillion dollar bonuses...
...wooden but plucky CEO of GM, Rick Wagoner, told the press that if his company is allowed to go into Chapter 11, it will end up being a simple liquidation. GM will be torn into pieces and sold off as scrap. He made one good point to support his point of view. If a bankruptcy of the No. 1 U.S. car company drags on for several months, potential auto buyers will purchase vehicles from competitors that they view as being "safe". No one wants to buy a car that won't be serviced. Wagoner has made this point before...
...GM has effectively taken a page out of the AIG playbook for gaming the Administration and Congress. Henry Paulson and his associates were led to believe, perhaps rightly, that if AIG failed it would cost other financial companies so significantly that the government would have to bailout almost every large financial firm in the country. GM's argument is even simpler. A liquidation of the car firm would probably cost tens of thousands of jobs at the company, and many times that at suppliers. That argument is also old, but with the chance of liquidation in the next few months...
...GM has been in the middle of quietly challenging the government's plan to close it down for three months now. The Administration has now sent its car experts to Detroit, and they have said that a bankruptcy of either GM or Chrysler is undesirable. They did not elaborate much on this analysis, but, from the standpoint of the car companies, they do not need to. It is enough that the blue chip analysts sent by the President to evaluate the car companies have a belief system that matches the one in The Motor City. (See pictures of the remains...
...GM is going to get a raise because the government will give it another $20 billion or $30 billion. The car industry embezzlement is more artful. With more than one million jobs at risk and unemployment rising at a pace rarely seen in American history, letting GM fail would completely compromise any chance of keeping the unemployment rate below 10%. If this figure rises above that number, it will make every American shudder...