The GOP Bungles the Auto Bailout

Reader Comments
Back to blog

So if all Republicans do not back whatever Pelosi and Reid want they're "grandstandning?" Yes, how dare they ask the UAW to make real concessions that would preserve their own jobs.
But important though this is, the bigger picture is how far these bailouts will go. Who's next? Will the quid pro quo be more government control, and thus a more statist economy? It looks that way.
Either way, pundits like Erbe would better serve their readers if they would lay off the snarkyness and make their poiints with facts and logic.

Tom the Redhunter of VA 10:40PM December 15, 2008

If conress or Bush won't send the domestic auto to the bancruptcy solution, then the customers will have. There are a lot of past customers out there that have had enough and will not purchase another Detroit auto. It's sad, because Detroit could be saved with the bankruptcy if they pursue it now. If they go ahead with loans and the companies will not make sufficent progress and the taxpayer will further abandon the U.S. Manufacturers and of course then it is to late. There is such a glut of unsold vehicles already by all manufacurers that if GM and Chrysler shut down for a short time it is not going to be significantly differen than what has to be done no matter what happens with their requests. The politicians will destroy the companies they are trying to help. I can see where people will avoid GM & Chrysler to get the problem overwith if congress cannot make sensible decisions.

loyal GM & Ford customer. of SD 9:46PM December 15, 2008

I don't endorse everything in G-L-B by any means. I also think that we failed to make a good legal structure and basis for new financial instruments and transactions that many people did not understand. That is by no means an excuse to go overboard in regulation and intervention - they have to find a good balance - and if you read any non-academic work by Paul Krugman, there is no balance! You can go way to extreme in not regulating, but you can also over-regulate. I just used the term "mental recession" (not an endorsement of Gramm's exact use of the phrase) because that is exactly how I feel every time I hear Paulson, Pelosi, and the rest of them speak! We need leaders that instill some confidence and optimism -- Obama may be the man and having Volcker and Orszag nearby is helpful... Because after we get through the recession, we will need to address our long run budget problems as well as any inflation that ultimately gets caused by pumping so much money into the economy through these less-than-well-thought-out policies.

Joe the Concerned Citizen of VA 1:22PM December 15, 2008

Phil Gramm was the author of a bill called Gramm-Leach-Bliley Act. It passed in 1999 and allowed banks to act as brokers, investors, insurance companies, with no oversight from ANYONE other than the Federal Reserve. This did away with the Glass-Steagull Act of 1933 that protected consumers and others from banks taking over other industries without oversight. Many analysts are saying this lack of oversight precipitated the current meltdown in progress. When banks conglomerate with other companies and have all their regulation removed and only report to the Federal Reserve, I think you see that the country falls into bankruptcy. I, too, believe in free markets but only with backstops against greed and corruption. Google and learn about the Gramm-Leach-Bliley Act and how it removed many regulation put in place during the depression to stop this very thing that rips at the fabric of our economy at this very moment. Also, recall that, in 1999, the Republican wave had taken hold in congress and senate. The house and senate were both a majority Republican.

Bill Swami of TN 12:39PM December 15, 2008

Henry Paulson, Nancy Pelosi, Barney Frank, Chris Dodd, and the rest of our so-called "leaders" in Congress and the Bureaucracy have done nothing but try to scare Americans into supporting these misguided and almost thoughtless bailouts. When firms go into Chapter 11 Bankruptcy PROTECTION they continue operating. As for the TARP, they did not debate long enough what exactly Treasury was supposed to do; consequently, we have Henry Paulson changing his mind when he feels like it (and Geithner is right there with him, so I wouldn't expect a change with the TARP after January 20). They are all creating a hysteria that could dampen our spirits further in this country and really lead to a serious recession. Phil Gramm spoke of a "mental recession"; it is condescending to say that given the context in which he made the statement, but a wave of irrational behavior sparked by our irresponsible leaders can send our economy further into stagnation. Then we have certain experts who want to drive us into even deeper debt. I am hopeful that a change in administrations can be an automatic morale booster to our country.
We all have so much to be proud of. This is a country where innovation is driven by small entrepreneurs - the reason we have a strong economy. The unholy alliance between these failed big businesses, big labor, and our corrupt and irresponsible big government is not what makes our economy robust - it is innovation and ideas! We have also liberated and helped so many people since WW2 and there is so much more work we need to do. The bailouts and overbearing intervention that stifles innovation are not going to help America one bit.

Joe the Concerned Citizen of VA 12:24PM December 15, 2008

I am also a FORMER Republican. It is good to see their true colors before they can do any more damage to this country.

Bill swami of TN 12:15PM December 15, 2008

But are finally started to get to get back on track. This "auto Bailout/bridge loan is completely against everything this country was founded on. It is NOT the Federal Governments responsibility to save privae comapanies. There are market tools and processes for dealing with issues like the car companies have, let the market work.
Thank God the Republicans stopped this bailout/loan, who knows who would have been next company too big to fail to come running with their hand out.

Larry of CA 10:29AM December 15, 2008

I am also an ex-Republican...1961 to the Iraq Invasion. Didn't always vote the ticket but stuck it out. I am appalled at today's Republican Party incompetence and their continuing desire to put rightwing political dogma before the good of our nation. The GOP has truly lost its way and the abilty to represent the American people's best interests!

Andy of FL 6:22AM December 15, 2008

What are you talking about? Where I live -- California -- "American" cars come with lower price tags on them than "foreign" cars in the same categories, and you talk about the cost of labor as if that's why Americans aren't buying "American" cars. Americans are buying fewer "American" cars because of their poor construction, poor gas mileage, and poor durability. It's that simple. (And I use all of those quotation marks, because Honda and Toyota and Nissan make American cars too.) Are you basically saying that "American" auto makers can't compete with non-"American" auto makers unless they can sell their vehicles at relatively lower prices?

of CA 2:48AM December 15, 2008

I hear that legislaters in foreign countries make far less than American legislaters here, so in all fairness, when are Corkle & Co. going to cut their salaries in half? After all, he is already wealthy, what does he need taxpayer funds for, and we need to make America competitive in this global economy?

Go UAW of KY 10:47PM December 14, 2008