You may have seen or heard this news snippet:
“GM says it doesn’t need more cash in March. General Motors Corp. says its restructuring plan is starting to take hold, improving the automaker’s fortunes at least to the point that it won’t need a US$2 billion U.S. government loan instalment that it had requested for March.” http://www.autonet.ca/autos/news/2009/03/12/8727786-ap.html
This article goes on to state that,
“Chief financial officer Ray Young said Thursday that GM formally told the Obama administration’s autos task force on Wednesday that it wouldn’t need the money this month. But in an interview with The Associated Press, Young would not say when the struggling automaker would need more government money or whether it will reduce the size of its loan request. “It seems like our company-wide cost reduction efforts are moving well, as well as we’ve been able to defer spending that we previously anticipated in January and February,” Young said. “I think that’s a positive development.”
So, no additional cash is needed this month. Wow, what a remarkable turn around.
Wait a minute, when something seems to good to be true, it usually isn’t true. Why, could something “be rotten in Denmark”, or in this case “Detroit”. Might the Obama Administration be prevaricating again, say like feigning surprise over the AIG bonuses?
Auto suppliers to get $5 billion in aid – Government to provide financing for troubled auto parts suppliers
WASHINGTON (AP) — The Treasury Department, trying to stabilize the battered auto industry, said Thursday it will provide up to $5 billion in financing to troubled auto parts suppliers who are linked to Detroit’s carmakers.
The funds would be made available from the government’s Troubled Assets Relief Program, or TARP, said members of the Obama administration’s auto task force. It would create a financial entity similar to a revolving credit to provide financing for auto parts that large suppliers have shipped to the Big Three automakers but have not yet been paid for.
U.S. automakers — General Motors Corp., Chrysler LLC and Ford Motor Co. — would have the option of using the program and would be required to pay a 5 percent fee of up to $250 million to join. The car makers would designate the parts suppliers who need financing and the suppliers would have to agree to terms of the government-backed protection and pay a small fee for the right to participate.
GM and Chrysler, which have received $17.4 billion in government loans, said they would use the program. Ford, which has not sought the government aid, said in a statement it would not participate “as we remain viable and expect no issue with continued payments to our suppliers.”
Members of the auto task force, who spoke on condition of anonymity because their discussions have been private, said the financing was a first step in restructuring the auto industry. The panel is expected to provide a framework for the revamping of GM and Chrysler by March 31.
The move was intended to help with the cash flow needs and stability of distressed auto suppliers, whose collapse could lead to the disruption of car production by the Big Three and lead to significant job losses.
“The program will provide supply companies with much needed access to liquidity to assist them in meeting payrolls and covering their expenses, while giving the domestic auto companies reliable access to the parts they need,” Treasury Secretary Timothy Geithner said in a statement.
Officials said foreign automakers with U.S. operations would not be eligible to use the so-called “supplier support program.”
So if you work for one of the foreign owned, but domestically located auto plants, a plant that pays Local, State and Federal taxes in your Community – your employer and the Business that is a valuable member of your Community, will be put at a competitive disadvantage by using your private and that Companies Corporate tax payments to strengthen a competitor who made add nothing to your Community.
In addition, the Government will now make direct payment to the Auto Suppliers while GM & Chrysler will receive direct part shipments. I can’t wait to see the waste and cost control measures gone awry.
So now the Government will now make good on GM & Chrysler parts I.O.U.’s – payments that GM & Chrysler “deferred” so that the Government could make direct payment.
No GM did not need the $2 Billion March Bailout Money – In it’s place the Government agreed to pay $5 Billion on behalf of GM directly to the GM parts creditors ….
Another payout at taxpayer expense – a plan with no plan – a bailout without an exit strategy – a public expenditure with no reasonable means of repayment ….
Isn’t enough … enough.
So GM doesn’t need any “March Bailout Money”
What a sham! What a bunch of prevaricators!
|to speak falsely or misleadingly; deliberately misstate or create an incorrect impression; lie.|
Synonyms: evade, shift.
Filed under: Auto Industry Bailout, Bailout, Banking, Banking Crisis, Detroit 3 Bailout, Economic Crisis, Tax Payer Rip Offs Tagged: | Bailouts - No End In Sight - $5 B More For GM, Detroit 3 Bailout Increased By $5 Billion, GM Gets Additional $5 Billion