Welfare is only OK when we help out our big business buddies and our friends who with major share holdings in those companies....

Quote :

"WASHINGTON (AP) -- -- Automakers plan to urge Congress to support funding up to $50 billion in low-interest loans over three years to help them modernize their assembly plants and develop next-generation fuel-efficient vehicles. Industry officials said the loans, which are twice the amount authorized in last year's energy bill, are a top priority when Congress returns next month because of the declining fortunes of Detroit's automakers and tightening credit markets. "The amount of concern and urgency from the Detroit companies has increased in the last month and significantly ratcheted up what they're communicating what their funding needs are," said Alan Reuther, legislative director for the United Auto Workers union. Congress authorized $25 billion in low-interest loans in last year's energy bill, but the auto industry's allies in Congress have been unable to get funding for the plan. The loans would provide low-interest credit for up to 30 percent of the cost of retooling facilities to build hybrids, plug-in hybrids, electric cars and other alternatives. Massive losses "

Does not this defeat the purpose of capitalism. If GM and Ford can't compete we thus are going to shove money down the chute to keep them floating anyway?

Quote :

"But in a statement released Friday, the Arizona Republican said Congress should fund the loan program in the energy bill: "I believe we should fund it and take action that will assist Detroit and its suppliers in making it through this difficult time of transition." Douglas Holtz-Eakin, McCain's top economic adviser, said the conditions had declined for auto companies seeking access to capital. "It's a common sense response to the realities on the ground," he said."

It kind of upsets me McCain supports this. I like living in the United States of America not the United States of Big Business. Obama supports this tool but this is no surprise. I would have though McCain would be more appreciative of the free market and want to be more conservative w/ tax payer money.

8/24/2008 5:07:05 PM

Quote :

"Income Statement Quarterly (Jun '08) Annual (2007) Annual (2006) Total Revenue 38,156.00 181,122.00 205,601.00 Gross Profit -881.00 14,543.00 18,912.00 Operating Income -12,476.00 -4,390.00 -5,823.00 Net Income -15,471.00 -38,732.00 -1,978.00 Balance Sheet Total Assets 136,046.00 148,883.00 186,304.00 Total Liabilities 193,016.00 185,977.00 191,956.00 Total Equity -56,970.00 -37,094.00 -5,652.00 "

http://seekingalpha.com/article/36931-gm-s-balance-sheet-a-sign-of-impending-doom

That article was written a year ago and was saying...

Quote :

"It may take a year. It may take two or three. But as far as I'm concerned they are already bankrupt. Just read their balance sheet, and weep. "

The quarterly June 08 income is for just the quarter. -15 billion * 4 = too much and a lot more than 38B.

Company's already dead. Why do we want to give low interest loans to this again?

8/24/2008 5:24:44 PM

no shit;

they can't repay the loan if they go broke

8/24/2008 5:26:43 PM

dude, i would bet so much money that they won't pay back any sympathy loans from the government.

Bankruptcy means you can't pay back the loans you already have. So hey, lets give them more loans at a lower rate.

8/24/2008 5:31:09 PM

loans

8/24/2008 6:29:14 PM

More like the United States of Bailouts, AMIRITE?!

8/24/2008 8:54:56 PM

I cant find the link on Mankiws site, but he had a quote from someone like.....

Quote :

"Heres an example of why the government is so big and inefficient. Amtrack was doing poorly so we flooded them with subsidies. Now with the higher gas prices, Amtrack is doing quite well. So what do we do? Flood them with subsidies."

8/25/2008 12:07:00 AM