National Debt Now Larger Than Entire USA's Total Economy's Worth

[WTF Are They Doing]

I really would like to know why many of my senators and congressmen/women and mostly Democrats do not seem bothered by the disasterious fact that the country is in $15.3 trillion dollars of debt and now surpasses in worth the United States of America's total economic worth in one year of $15.1 trillion dollars ?

If my college economics means anything this means the country is bankrupt yet the Democrats still want to spend more tax dollars.

Where is this all going to end ?

[Pulse]

I really would like to know why many of my senators and congressmen/women and mostly Democrats do not seem bothered by the disasterious fact that the country is in $15.3 trillion dollars of debt and now surpasses in worth the United States of America's total economic worth in one year of $15.1 trillion dollars ?

If my college economics means anything this means the country is bankrupt yet the Democrats still want to spend more tax dollars.

Where is this all going to end ?

Paul Krugman says we need to spend more! He is the Democrats economics guru, so pile on the spending!!

[You scared me!]

I really would like to know why many of my senators and congressmen/women and mostly Democrats do not seem bothered by the disasterious fact that the country is in $15.3 trillion dollars of debt and now surpasses in worth the United States of America's total economic worth in one year of $15.1 trillion dollars ?

If my college economics means anything this means the country is bankrupt yet the Democrats still want to spend more tax dollars.

Where is this all going to end ?

For a second I though you said Nassau County's debt.

[Unregistered55]

War with Iran coming soon!

Complete collapse of US economy to follow!

[Mr Informed]

After 9/11 there have been two wars that cost the U.S. over 3 trillion dollars.
The cost of these wars was off budget.

During WWII, the national debt also was equal to the nation's GDP for one year.

The situation is not good but both parties should share the blame. So you Republicans should stop with the crocodile tears.

[bambamobamaman]

look at the horrible figure of debt and obama now wants another 1.2 trillion dollars added to it for immediate use

he must want to buy this next election

and the country will tinker on collapse

an wont even know it

[Unregistered88]

look at the horrible figure of debt and obama now wants another 1.2 trillion dollars added to it for immediate use

he must want to buy this next election

and the country will tinker on collapse

an wont even know it

That's for money already committed. It would be like not paying your credit card bills. Try to educate yourself before posting.

[Unregisteredklmn]

That's for money already committed. It would be like not paying your credit card bills. Try to educate yourself before posting.

Obama stated he wants the debt ceiling raised once again to over a trillion dollars
the other poster seems to be right on
no matter how you cut it Obama and his democrats are sinking us into bankruptcy

[Unregistered88]

Obama stated he wants the debt ceiling raised once again to over a trillion dollars
the other poster seems to be right on
no matter how you cut it Obama and his democrats are sinking us into bankruptcy

No matter how you cut it you don't know what you're talking about. Raising the debt ceiling (which is something Republican presidents have also done) is about meeting your obligations. If you don't do it you become a deadbeat country. Like I said, TRY to educate yourself before posting.

[Bamamustgo]

All I know is that Obama campaigned on the fact that gearge bush took office with zero debt and he was leaving us in a hole 300 billion, now Obama is trying to justify a near 19trillion dollar debt? How does he look us straight in the eye and say this is a good idea?

[UnregisteredHasBeen]

The USA is on the verge of collapse, and what you are seeing is the Establishment taking care of their own with "bailouts" (TARP) and "Loans" (Solyndra, for example). Made-up threats like Iran and "Terrorism" keeps the MIC (Military Industrial Complex) raking-in the billion$.

Once economic collapse becomes reality, the politically connected will be getting-by just fine while the other 98%+ are waiting 2-hours on line for a government-provided loaf of bread.

But then, that IS the government the people elected. So you made your own bed, now sleep in it.

By the way, America's decline did NOT begin w/Obama (Americans like to forget history and simply blame the current President for everything from the economy to a bump in the road). Our decline began w/the founding of the Federal Reserve (and the income tax) and was cemented in the early 70's when we completely abandoned the gold standard.

Our Founding Fathers knew this and warned us and even drafted law to prevent this (the Constitution). But, in the course of the last 100 years the Constitution was slowly shredded while the "people" stood around picking their noses.

Oh well. Next.

[UnObserverb]

All I know is that Obama campaigned on the fact that gearge bush took office with zero debt and he was leaving us in a hole 300 billion, now Obama is trying to justify a near 19trillion dollar debt? How does he look us straight in the eye and say this is a good idea?

Did you get your numbers from National Lampoon? The debt was $10 trillion when Bush left office. It went up $4 trillion from there in 2 years. Your $300 billion number is ridiculous.

[Unregisteredbanker]

Did you get your numbers from National Lampoon? The debt was $10 trillion when Bush left office. It went up $4 trillion from there in 2 years. Your $300 billion number is ridiculous.

Bush ran up a 4 trillion dollar debt when he left office

Obama in 3 years raised the debt up over 15 trillion dollars

Also why Dems say Clinton balanced the budget when president he also ran up the national debt to help balance that budget

Tea Party people will have the last laugh but the country will have collapsed and the progressive liberals will be saying capitalism doesn't work

[Mr Informed]

The Tea Party people will not laugh because most of them are on Social Security and Medicare.

Clinton (with a Republican congress) did have surpluses in the last few years of his term and the national debt was reduced.

[fg44]

The Tea Party people will not laugh because most of them are on Social Security and Medicare.

Clinton (with a Republican congress) did have surpluses in the last few years of his term and the national debt was reduced.

Ask anyone 30 and under if they expect Medicare and Social Security to be around when they are 60.

[lotsaluk]

Babyboomers an generation Xer's are corrupt as sin

the country is on the brink and wall street is just a blip on the screen

[UnObserverb]

Bush ran up a 4 trillion dollar debt when he left office

Obama in 3 years raised the debt up over 15 trillion dollars

Also why Dems say Clinton balanced the budget when president he also ran up the national debt to help balance that budget

Tea Party people will have the last laugh but the country will have collapsed and the progressive liberals will be saying capitalism doesn't work

The national debt was $10 trillion when Bush left office. Look it up. $10 trillion.

Tea Partiers want to push us back into recession. Don't believe me? Look at Europe. They decided to embrace austerity. 2012 will see Europe drift back into recession. Not us.

[fg44]

The national debt was $10 trillion when Bush left office. Look it up. $10 trillion.

Tea Partiers want to push us back into recession. Don't believe me? Look at Europe. They decided to embrace austerity. 2012 will see Europe drift back into recession. Not us.

Europe has no choice, Banks won't lend them money anymore, and their state welfare system has broken the bank. They cannot afford it. That is where we will be if we don't correct things over here NOW.

[UnObserverb]

Europe has no choice, Banks won't lend them money anymore, and their state welfare system has broken the bank. They cannot afford it. That is where we will be if we don't correct things over here NOW.

Right. That's where we will be if we shut down the economy like the tea partiers want.

[fg44]

Right. That's where we will be if we shut down the economy like the tea partiers want.

No, thats where we will be if we don't stop government spending, let private business expand,
Without the government picking their favorites, crony capitalism
Solyndra and 11 others went bankrupt

We are not Europe although liberals want us there real bad!!!

[UnObserverb]

No, thats where we will be if we don't stop government spending, let private business expand,
Without the government picking their favorites, crony capitalism
Solyndra and 11 others went bankrupt

We are not Europe although liberals want us there real bad!!!

In case you didn't notice OUR economy IS expanding. OUR auto industry is doing very well. If the tea partiers had their we wouldn't even have an auto industry. We are in much better shape than Europe because we did not hit the brakes (get it?) on our economy the way they did. Also, we control our own currency. There's no comparison with Europe, although tea partiers like to spread that fiction.

[Paul Revere Rides]

In case you didn't notice OUR economy IS expanding. OUR auto industry is doing very well. If the tea partiers had their we wouldn't even have an auto industry. We are in much better shape than Europe because we did not hit the brakes (get it?) on our economy the way they did. Also, we control our own currency. There's no comparison with Europe, although tea partiers like to spread that fiction.

Country is in the abyss for 15.3 trillion dollars and president Obama wants another 1.2 trillion dollars to spend this year

we all wish it were fiction but it's not the taxpayers will pay and pay and pay

[UnObserverb]

Country is in the abyss for 15.3 trillion dollars and president Obama wants another 1.2 trillion dollars to spend this year

we all wish it were fiction but it's not the taxpayers will pay and pay and pay

It's not "Obama wants another 1.2 trillion dollars to spend this year." That money is already "spent". Now we need to pay our bills. Not authorizing it is like not paying your credit card bill.

[fg44]

It's not "Obama wants another 1.2 trillion dollars to spend this year." That money is already "spent". Now we need to pay our bills. Not authorizing it is like not paying your credit card bill.

You cut your spending and you wouldn't have this bill. Obama rejected the recommendations of his own Commission, bi partisan which would have addressed the deficit, Obama...Massive Fail.

Auto industry...would have continued just fine, they would have went into Bankruptcy as Hostess just did this week. The only difference is Obama stole money from stockholders of the auto companies and gave it to the Unions. The auto industry still would have been operating, but with labor concessions instead of senior citizens losing their savings in "safe" auto company stock and bonds.

[UnregisteredCollapse]

In case you didn't notice OUR economy IS expanding. OUR auto industry is doing very well. If the tea partiers had their we wouldn't even have an auto industry. We are in much better shape than Europe because we did not hit the brakes (get it?) on our economy the way they did. Also, we control our own currency. There's no comparison with Europe, although tea partiers like to spread that fiction.


The economy's expansion is artificial; created w/make-believe money and credit. You say "If the tea partiers had their we wouldn't even have an auto industry." By "auto industry" you must mean GM because Ford didn't need a bailout and Chrysler would have been bought-up by someone anyway. If the markets were allowed to work, GM would have collapsed for no other reason than their products suck and they've known it for 30+ years. Had GM collapsed those car buyers would have bought other brands fueling growth on that side, so nothing would have been lost.

[polonuis]

Because in the end they are going to steal your money and raise your taxes to give to their voters who are brown skinned and limited. They pay little in taxes yet want voice! Their kids are not as bright but get promoted and even excepted to schools, depriving more deserving students. They commit more crime, its on film and its not reality its racism. Their schools and neighborhoods suck, with anything not sat on stolen. And then they give us
this jackass Obama! Its a wonder we pay our taxes! We should all pull a Sharpton a make up a lame excuse! No tax breaks for unwed mothers and
no more illegal immigrants. Invitation only! W were find with out you and now we're bankrupt! Get fucking out!

[Mr Informed]

Polonius: What bar did you hear that in?

[falseflag]

The economy's expansion is artificial; created w/make-believe money and credit. You say "If the tea partiers had their we wouldn't even have an auto industry." By "auto industry" you must mean GM because Ford didn't need a bailout and Chrysler would have been bought-up by someone anyway. If the markets were allowed to work, GM would have collapsed for no other reason than their products suck and they've known it for 30+ years. Had GM collapsed those car buyers would have bought other brands fueling growth on that side, so nothing would have been lost.

Spot on about the auto industry.

[fg44]

Spot on about the auto industry.

What? You mean the Democrats claim of saving American industry is false?
All they did was steal money from retired pensioners and give it to the auto labor unions, pay to play.

[Mr Informed]

The U.S. auto industry is doing just fine. The TARP money was all they needed to weather the credit market crash.

You guys are a bunch of nay saying whiners. By the way, if GM had gone bust, so would have the parts suppliers. Then what would Ford have done?

Your hero Ron Paul is nothing more than a fringe lunatic (who gets lots of earmarks for his congressional district.)

[UnObserverb]

The economy's expansion is artificial; created w/make-believe money and credit. You say "If the tea partiers had their we wouldn't even have an auto industry." By "auto industry" you must mean GM because Ford didn't need a bailout and Chrysler would have been bought-up by someone anyway. If the markets were allowed to work, GM would have collapsed for no other reason than their products suck and they've known it for 30+ years. Had GM collapsed those car buyers would have bought other brands fueling growth on that side, so nothing would have been lost.

You're kidding, right? Nothing would have been lost? People would have bought other brands, yes. Honda, Toyota, Nissan, Subaru, BMW, Audi, etc. So when we send our cash to foreign companies instead of keeping it here, nothing's lost?

[UnObserverb]

You cut your spending and you wouldn't have this bill. Obama rejected the recommendations of his own Commission, bi partisan which would have addressed the deficit, Obama...Massive Fail.

Auto industry...would have continued just fine, they would have went into Bankruptcy as Hostess just did this week. The only difference is Obama stole money from stockholders of the auto companies and gave it to the Unions. The auto industry still would have been operating, but with labor concessions instead of senior citizens losing their savings in "safe" auto company stock and bonds.

There ARE labor concessions from the auto industry. That was a condition of their being allowed to continue to operate.

"would have went". Stop cutting those English classes, they come in handy.

[fg44]

There ARE labor concessions from the auto industry. That was a condition of their being allowed to continue to operate.

"would have went". Stop cutting those English classes, they come in handy.

American law (until Obama threw law out the window) dictated that GM file for bankruptcy and undergo a orderly re organization , as other companies have successfully done before them, except this involved labor unions , and Obama owed the labor unions, so he stole the pensioners equityin GM and gave it to his campaign contributing friends, the unions.

You must be a Democrat, there were no personal insults on this thread until you appeared

[UnObserverb]

American law (until Obama threw law out the window) dictated that GM file for bankruptcy and undergo a orderly re organization , as other companies have successfully done before them, except this involved labor unions , and Obama owed the labor unions, so he stole the pensioners equityin GM and gave it to his campaign contributing friends, the unions.

You must be a Democrat, there were no personal insults on this thread until you appeared

If you had your way America would no longer produce the Corvette. America's not America without the Vette! How dare you?

And who are you kidding Pulse? "a orderly re organization" Really?

[fg44]

If you had your way America would no longer produce the Corvette. America's not America without the Vette! How dare you?

And who are you kidding Pulse? "a orderly re organization" Really?

Personal insults get thrown. Straight Alinsky tactics! Right from the playbook.

GM, and the Corvette, would still be in production in the US, profitably!

An orderly re organization, as all other American companies that filed for bankruptcy protection undergo.
This President broke the law and stole money fronm retired pensioners and gave it in equity to the labor unions.
Those are facts.
And what the hell is a Pulse? Another American classic car?

[UnObserverb]

Personal insults get thrown. Straight Alinsky tactics! Right from the playbook.

GM, and the Corvette, would still be in production in the US, profitably!

An orderly re organization, as all other American companies that filed for bankruptcy protection undergo.
This President broke the law and stole money fronm retired pensioners and gave it in equity to the labor unions.
Those are facts.
And what the hell is a Pulse? Another American classic car?

We got a reorganized company, with labor concessions, WITHOUT the pain of bankruptcy.

[WTF's WRONG]

Are made in Mexico !

[fg44]

We got a reorganized company, with labor concessions, WITHOUT the pain of bankruptcy.

Tell that to the retired pensioners who held GM bonds. They were robbed!!!!

Lot of pain there, in addition to breaking the law

[UnObserverb]

Tell that to the retired pensioners who held GM bonds. They were robbed!!!!

Lot of pain there, in addition to breaking the law

Just looked it up. There was a bankruptcy AND the secured lenders received $1.5 billion from GM assets sold out of bankruptcy.

In earlier court papers, Treasury has indicated that the $1.5 billion loan repayment was part of the larger $33.3 billion bankruptcy loan it extended to GM to prevent the auto maker's total collapse in bankruptcy. GM's bankruptcy estate completed its Chapter 11 case earlier this year. The reorganized GM is again operating as a publicly traded company.

So where's your beef?

[fg44]

The biggest losers here are GM's bondholders. According the Treasury-GM debt-for-equity swap announced Monday, GM has $27.2 billion in unsecured bonds owned by the public. These are owned by mutual funds, pension funds, hedge funds and retail investors who bought them directly through their brokers. Under Monday's offer, they would exchange their $27.2 billion in bonds for 10% of the stock of the restructured GM. This could amount to less than five cents on the dollar.

The Treasury, which is owed $16.2 billion, would receive 50% of the stock and $8.1 billion in debt -- as much as 87 cents on the dollar. The union's retiree health-care benefit trust would receive half of the $20 billion it is owed in stock, giving it 40% ownership of GM, plus another $10 billion in cash over time. That's worth about 76 cents on the dollar, according to some estimates.

In a genuine Chapter 11 bankruptcy, these three groups of creditors would all be similarly situated -- because all three are, for the most part, unsecured creditors of GM. And yet according to the formula presented Monday, those with the largest claim -- the bondholders -- get the smallest piece of the restructured company by a huge margin.

[UnObserverb]

Bottom line: without Treasury assistance, GM probably goes under, which is good for nobody.

[fg44]

Bottom line: without Treasury assistance, GM probably goes under, which is good for nobody.

The whole point of this thread was how the government stole bondholders equity and gave it to his campaign contributers, the unions.

Treasury assistance still could have been given without stealing from the bondholders.

In a genuine Chapter 11 bankruptcy, these three groups of creditors would all be similarly situated -- because all three are, for the most part, unsecured creditors of GM. And yet according to the formula presented Monday, those with the largest claim -- the bondholders -- get the smallest piece of the restructured company by a huge margin.

[UnObserverb]

The whole point of this thread was how the government stole bondholders equity and gave it to his campaign contributers, the unions.


Sorry, that wasn't "the whole point of this thread."

[345554]

General Motors Co.'s recent stock offering was staged to start paying back the government for its $50 billion bailout, but one group made out much better than the taxpayers or other investors: the company's union.

Thanks to a generous share of GM stock obtained in the company's 2009 bankruptcy settlement, the United Auto Workers is well on its way to recouping the billions of dollars GM owed it — putting it far ahead of taxpayers who have recouped only about 30 percent of their investment and further still ahead of investors in the old GM who have received nothing.

The boon for the union fits the pattern established when the White House pushed GM into bankruptcy and steered it through the courts in a way that consistently put the interests of the union ahead of many suppliers, dealers and investors — stakeholders that ordinarily would have fared as well or better under the bankruptcy laws.
"Priority one was serving the interests of the UAW" when the White House's auto task force engineered the bankruptcy, said Glenn Reynolds, an analyst at CreditSights. The stock offering served to show once again how the White House has handsomely rewarded its political allies, he said.
The union's health care and pension trust fund earned $3.4 billion through the sale of one-third of its shares in GM last week. Analysts estimate that it would break even if it sells the remaining two-thirds of its shares at an average price of $36 — close to where the stock traded shortly after the offering hit the market. GM shares closed at $33.45 on Wednesday.

For taxpayers to break even, by contrast, the stock would have to rise to at least $52 and by some estimates as high as $103 — levels that would take years to achieve.
In any event, after selling one-third of its shares last week, the U.S. Treasury has agreed not to sell any more of its GM stock for another six months, while the union fund is free to keep selling its shares.

Through the offering, the Treasury recouped $13.7 billion of its $49.5 billion cash infusion in GM, with another $1.8 billion possible by the end of the year. GM is repaying another $9.5 billion in loans from the Treasury, but that still leaves taxpayers a long way from breaking even.
Union claims ordinarily do not receive such special treatment in bankruptcies.

The generous share of GM stock given to the union trust fund under the White House deal puts it not only ahead of the Treasury but on a par with secured creditors such as banks, which normally receive the most favorable treatment from bankruptcy courts.
Perhaps the biggest losers are the investors in the old GM. None of the bankrupt company's previous stockholders got any money, while the claims of thousands of investors who purchased the company's bonds are still being kicked around in a Manhattan bankruptcy court.

"It gives outraged flashbacks to the old GM bondholders," who remain mired in the bankruptcy proceedings and are unlikely to recover more than 30 percent of their investments, Mr. Reynolds said.
He compared the deal to the corrupt crony capitalism in Russia under President Vladimir Putin.
The White House "took a page out of the Putin political asset reallocation and reward system" when it engineered the deal, he said.

Mr. Reynolds also described the White House deal as a combination of "Boss Tweed on steroids" and "Hugo Chavez on meds," as far as the bondholders are concerned.

[UnObserverb]

Bottom line: without Treasury assistance, GM probably goes under, which is good for nobody.

[264ytr]

General Motors Co.'s recent stock offering was staged to start paying back the government for its $50 billion bailout, but one group made out much better than the taxpayers or other investors: the company's union.

Thanks to a generous share of GM stock obtained in the company's 2009 bankruptcy settlement, the United Auto Workers is well on its way to recouping the billions of dollars GM owed it — putting it far ahead of taxpayers who have recouped only about 30 percent of their investment and further still ahead of investors in the old GM who have received nothing.

The boon for the union fits the pattern established when the White House pushed GM into bankruptcy and steered it through the courts in a way that consistently put the interests of the union ahead of many suppliers, dealers and investors — stakeholders that ordinarily would have fared as well or better under the bankruptcy laws.
"Priority one was serving the interests of the UAW" when the White House's auto task force engineered the bankruptcy, said Glenn Reynolds, an analyst at CreditSights. The stock offering served to show once again how the White House has handsomely rewarded its political allies, he said.
The union's health care and pension trust fund earned $3.4 billion through the sale of one-third of its shares in GM last week. Analysts estimate that it would break even if it sells the remaining two-thirds of its shares at an average price of $36 — close to where the stock traded shortly after the offering hit the market. GM shares closed at $33.45 on Wednesday.

For taxpayers to break even, by contrast, the stock would have to rise to at least $52 and by some estimates as high as $103 — levels that would take years to achieve.
In any event, after selling one-third of its shares last week, the U.S. Treasury has agreed not to sell any more of its GM stock for another six months, while the union fund is free to keep selling its shares.

Through the offering, the Treasury recouped $13.7 billion of its $49.5 billion cash infusion in GM, with another $1.8 billion possible by the end of the year. GM is repaying another $9.5 billion in loans from the Treasury, but that still leaves taxpayers a long way from breaking even.
Union claims ordinarily do not receive such special treatment in bankruptcies.

The generous share of GM stock given to the union trust fund under the White House deal puts it not only ahead of the Treasury but on a par with secured creditors such as banks, which normally receive the most favorable treatment from bankruptcy courts.
Perhaps the biggest losers are the investors in the old GM. None of the bankrupt company's previous stockholders got any money, while the claims of thousands of investors who purchased the company's bonds are still being kicked around in a Manhattan bankruptcy court.

"It gives outraged flashbacks to the old GM bondholders," who remain mired in the bankruptcy proceedings and are unlikely to recover more than 30 percent of their investments, Mr. Reynolds said.
He compared the deal to the corrupt crony capitalism in Russia under President Vladimir Putin.
The White House "took a page out of the Putin political asset reallocation and reward system" when it engineered the deal, he said.

Mr. Reynolds also described the White House deal as a combination of "Boss Tweed on steroids" and "Hugo Chavez on meds," as far as the bondholders are concerned.

I don't understand, why would 1 group of unsecured do so much better than another? Per bankruptcy law they should be treated equally. Are you saying politics influenced this Administration?

[UnObserverb]

Both automakers are here today, building cars, mostly in the Midwest, and re-hiring thousands of workers, because the U.S. government kept both companies, in the midst of the meltdown of financial markets in 2008 and early 2009, from being chopped up piecemeal. The rescue of the two automakers also kept hundreds of auto parts companies from going bust. The U.S. auto industry is still the spine of the economies of Michigan, Ohio, Indiana, as well as being important to other states including Pennsylvania, Illinois and Kentucky.

In all, the Center for Automotive Research (CAR) in Ann Arbor, Mich., reckons the government's bailouts of the U.S. auto industry spared more than 1.14 million jobs in 2009, and prevented "additional personal income losses" of nearly $97 billion in 2009 and 2010. Another 314,400 jobs were saved in 2010. The research organization based its conclusions on the potential impact of auto-industry collapse for jobs at U.S. automakers and suppliers, and ripple effects on the economy at large.

The legion of critics of the bailout is quite a gallery: from Presidential hopefuls Rep. Michele Bachmann (R-Minn.) and Mitt Romney (let's see if he sticks to that when he campaigns in Michigan this year) to the more thoughtful, if still stubbornly incorrect, Dan Ikenson, associate director of the libertarian Cato Institute's Herbert A. Stiefel Center for Trade Policy Studies.

The opposition to the bailout by politicians, practically all of them Republican, is understandable given that most political debates today are ideological rather than practical. Republicans tend to believe the markets will solve all the ills of the world without government regulations or intervention (The Gulf oil spill is the fault of too much regulation, not carelessness).But let's focus on Ikenson's arguments, which have tended to feed the talking points of the anti-bailout crowd. His beef, in short, is that the proper free-market thing to do would have been to let GM atrophy, go into bankruptcy in a normal fashion rather than the tax-payer assisted version, and the other automakers would have picked up GM's lost business and market share. And all would be well with the world without costing the taxpayer a cent..

The problem with arguing on ideological terms is that it does not often take into account what is really happening on the ground to real people. The auto industry is a complex web of companies and suppliers with millions of livelihoods dependent on the flow of cars and trucks down assembly lines. The best way to lay out why the bailout was good for the U.S., and its economy, is step-by step.
Was bailing out GM and Chrysler the right thing to do?

Yes
No
Vote


1. There was no bankruptcy "reorganization" of GM and Chrysler without the U.S. government. Banks were in such dire shape that none were stepping up to provide what is known as "debtor-in-possession" financing for the reorganization of the companies. Without that, bankruptcy would have instead been a prolonged (it could still be going on) liquidation of GM and Chrysler assets to try and pay off bondholders and other debtors. Brands, plants, machinery, real estate, etc. would have been sold off for nickels on the dollar to other automakers and other investors looking for bargains.

2. Ikenson bemoans the subvention of the "rule of law," and property rights of "preferred bondholders" who were forced to take pennies on the dollar based on what they paid for, say, GM's bonds (while some individual bondholders paid 100 cents on the dollar, most bondholders were investors who bought bonds at fire sale prices to begin with). Investors make bets when they buy stocks or bonds. The bet on GM and Chrysler bonds didn't pay off for them. If the Obama Administration went outside the law, then why did a Federal judge bless it in the bankruptcy procedure? And where are the viable lawsuits challenging the legality of the proceedings?

3. People who are on their third, fourth or fifth Honda or BMW had, and still have, very little care about whether GM or Chrysler survive. Their liquidation wasn't going to impact their lives, so they resented having tax dollars committed to the cause. Likewise, elected officials such Alabama Senator Richard Shelby, who can't count a Detroit auto plant among his constituents, has been against the bailout. But Shelby, against government assistance for private companies in general, has been nonetheless supportive of hundreds of millions of dollars in taxpayer subsidies going to Mercedes-Benz, Hyundai, Kia and Honda and parts companies to attract those companies' plants to Alabama. The President can't afford to be so parochial in his thinking, and actually has to make calls that impact the entire country, not just a single state or driveway.

4. Like it or not, the auto industry is critical to the U.S. economy. CAR estimated the loss of 3 million jobs over three years if GM and Chrysler were allowed to go belly-up, with only about 240,000 jobs being at the auto manufacturers themselves. The rest were the attendant industries that interconnect with autos. The loss of personal income by the end of 2011 would have been $400 billion by the end of 2011, and the costs to the U.S. Treasury would have been $156 billion, according to CAR.

[Pulse]

I don't understand, why would 1 group of unsecured do so much better than another? Per bankruptcy law they should be treated equally. Are you saying politics influenced this Administration?

Its called crony capitalism

[Unregisteredwhocares]

You're kidding, right? Nothing would have been lost? People would have bought other brands, yes. Honda, Toyota, Nissan, Subaru, BMW, Audi, etc. So when we send our cash to foreign companies instead of keeping it here, nothing's lost?

Like I said, nothing lost. Me thinks those GM buyers would have flocked to Ford or Chrysler, not a foreign brand. People are not going to stop buying cars because a brand went under.

[YoureActuallyUnInformed]

The U.S. auto industry is doing just fine. The TARP money was all they needed to weather the credit market crash.

You guys are a bunch of nay saying whiners. By the way, if GM had gone bust, so would have the parts suppliers. Then what would Ford have done?

Your hero Ron Paul is nothing more than a fringe lunatic (who gets lots of earmarks for his congressional district.)

Look before the "credit market crash" and you'll see the Big Three were struggling LONG before then. GM has been flirting w/Bankruptcy so long as I can remember...long before any "recession" or "credit crunch".

Had GM gone bust, those car buyers would have bought another brand. That brand would sell more, and that means the maker would buy more parts. Simply put, those designing/building/selling GM would simply design/build/sell for somebody else. Yes, there would be some bumps, probably much consolidation, but in the end the industry would be better and leaner. As it a should be.

[UnObserverb]

Look before the "credit market crash" and you'll see the Big Three were struggling LONG before then. GM has been flirting w/Bankruptcy so long as I can remember...long before any "recession" or "credit crunch".

Had GM gone bust, those car buyers would have bought another brand. That brand would sell more, and that means the maker would buy more parts. Simply put, those designing/building/selling GM would simply design/build/sell for somebody else. Yes, there would be some bumps, probably much consolidation, but in the end the industry would be better and leaner. As it a should be.

Yes, the FOREIGN auto market would have made out just fine. Not the US auto market.

[Pulse]

Yes, the FOREIGN auto market would have made out just fine. Not the US auto market.

Why? Ford has done just fine, buyers of Government Motors cars would first look to another American company.
Stop spinning, it was a political payoff to the labor unions.
It is what Democrats do, it was not out of character for them, the unions contribute hundreds of millions of dollars to Obamas campaign, they expected payback. I think we all can agree with that :)

[UnObserverb]

Why? Ford has done just fine, buyers of Government Motors cars would first look to another American company.


How many? Certainly not 100%. Probably not even close.

[Pulse]

How many? Certainly not 100%. Probably not even close.

That would have preferable than breaking the law, just how did the unions, with less of a financial interest than the bondholders, come out with a massive interest in the new company and the bondholders got squat

[UnregisteredMaybeWhoCares]

Yes, the FOREIGN auto market would have made out just fine. Not the US auto market.

As I originally said, I believe that GM buyers would have went to Ford, or even Chrysler. Had they gone to a foreign brand; so what? Who could blame them as American cars are lower quality? Besides, many "foreign" cars are made right here in the USA while many "American" cars are built in Mexico or Canada.

The government bailed-out a loser. The other poster is right; the bailout was a payoff to the unions.

[UnObserverb]

As I originally said, I believe that GM buyers would have went to Ford, or even Chrysler. Had they gone to a foreign brand; so what? Who could blame them as American cars are lower quality? Besides, many "foreign" cars are made right here in the USA while many "American" cars are built in Mexico or Canada.

The government bailed-out a loser. The other poster is right; the bailout was a payoff to the unions.

It wouldn't have been possible for Ford and/or Chrysler (owned by Fiat anyway) to absorb all of GM's customers all at once as it would have taken time to ramp up production. In the meantime a customer could wait several months at least for a new car to arrive or walk next door to the Toyota dealer or across the street to the Honda dealer. So that's more money that goes out of our GDP. That's "so what".

[264ytr]

It wouldn't have been possible for Ford and/or Chrysler (owned by Fiat anyway) to absorb all of GM's customers all at once as it would have taken time to ramp up production. In the meantime a customer could wait several months at least for a new car to arrive or walk next door to the Toyota dealer or across the street to the Honda dealer. So that's more money that goes out of our GDP. That's "so what".

Too funny, you are a Obama professional spin master. Obama could sell you his crap on a sandwich and you buy it.
Guess what , most people don't. Thank God this government intervention ends in November

[UnObserverb]

Too funny, you are a Obama professional spin master. Obama could sell you his crap on a sandwich and you buy it.
Guess what , most people don't. Thank God this government intervention ends in November

That's actually marginally funny, coming from someone who posts everything straight from the RNC website. You buy everything they sell, so who are you trying to kid? You got beat and this is the best you can come up with?

[264ytr]

That's actually marginally funny, coming from someone who posts everything straight from the RNC website. You buy everything they sell, so who are you trying to kid? You got beat and this is the best you can come up with?

November baby, we can wait until November.

Country might not be able to though

[UnObserverb]

November baby, we can wait until November.

Country might not be able to though

Made it through Bush. Well, not really.

[UnregisteredBuyBetter]

It wouldn't have been possible for Ford and/or Chrysler (owned by Fiat anyway) to absorb all of GM's customers all at once as it would have taken time to ramp up production. In the meantime a customer could wait several months at least for a new car to arrive or walk next door to the Toyota dealer or across the street to the Honda dealer. So that's more money that goes out of our GDP. That's "so what".

FIAT did not own Chrysler during the bailout fiasco.

Even if GM went under, there was a large supply of cars already built that would have been sold. And I think Ford and the others would have easily stepped-in to fill the remaining demand.

As for Toyota/Honda vs. who-ever, Toyota and Honda are building here in the USA (and seemingly have better relations w/their unions) while GM is building in Mexico and Canada and is even looking at China as a manufacturing hub.

Friend, If you don't support free markets, that's fine. But call this bailout what it was; a payback to the unions.

[264ytr]

FIAT did not own Chrysler during the bailout fiasco.

Even if GM went under, there was a large supply of cars already built that would have been sold. And I think Ford and the others would have easily stepped-in to fill the remaining demand.

As for Toyota/Honda vs. who-ever, Toyota and Honda are building here in the USA (and seemingly have better relations w/their unions) while GM is building in Mexico and Canada and is even looking at China as a manufacturing hub.

Friend, If you don't support free markets, that's fine. But call this bailout what it was; a payback to the unions.

He can't , he is a programmed ideologue, if Obama $hits it, it is golden.

[UnObserverb]

FIAT did not own Chrysler during the bailout fiasco.

Even if GM went under, there was a large supply of cars already built that would have been sold. And I think Ford and the others would have easily stepped-in to fill the remaining demand.

As for Toyota/Honda vs. who-ever, Toyota and Honda are building here in the USA (and seemingly have better relations w/their unions) while GM is building in Mexico and Canada and is even looking at China as a manufacturing hub.

Friend, If you don't support free markets, that's fine. But call this bailout what it was; a payback to the unions.

IF GM went under, some of their buyers here would have gone to foreign car companies. Can't tell how many, but some would have. Whatever the number it would have had a negative impact on our GDP. Furthermore, GM sells a lot of cars overseas. Certainly those car buyers would have had no reason to continue to buy American. Still more money that would have left our GDP at a time we could least afford it. That would have been good how?

The bailout worked.

[maxmo]

For stealing our technology and intellectual property! Currency manipulation
can be claimed also.

[Unregisteredunthinkable]

In 2008 Obama said the national debt under George Bush was criminal.

3 years after being elected president Obama has more than quadrupled that national debt.

So whose the real criminal ?

[Unregistered88]

If a building burns down you not only have to put out the fire but the building needs to be rebuilt. That takes time. Bush lit the fire and burned the building to the ground. The fire was put out. The building is in the process of being rebuilt, but it will take some time.

[Unregistered2323]

In 2008 Obama said the national debt under George Bush was criminal.

3 years after being elected president Obama has more than quadrupled that national debt.

So whose the real criminal ?

That would make the National debt 44 trillion. Thats not counting that the Presidents first years budget was always passed by the outgoing President.

[Unregi34535]

In 2008 Obama said the national debt under George Bush was criminal.

3 years after being elected president Obama has more than quadrupled that national debt.

So whose the real criminal ?

Obama!

[absolutely true]

Obama!

absolutely, no matter how the dems try and spin it, he quadrupled the debt and he's still not finished, irresponsible and dangerous Obama is

[Unregistered//]

Read post #67 again. Wow, you people are desperate!

[kitkatty]

God save America from the left!

[UnregisteredPatriot]

God save America from the left!

Might be too late

[UnregisteredPatriot]

God save America from the left!

We can do it oursulves with a little backbone and gumption!

[Petroned]

We can do it oursulves with a little backbone and gumption!

http://rlv.zcache.com/talk_radio_eib_tshirt-p235627008481277391zvfiw_400.jpg

[BunkumBuster]

Former U.S. Comptroller David Walker has warned that the U.S. could slide into a debt scenario similar to what Greece is experiencing.

“The truth is if you count total U.S. government debt as compared to many of the European nations that are in the news, we’re already worse than they are, and we’re two years away from where Greece was when it had its crisis,” Walker said in a recent interview with CYInterview.com.

But he said that the size and economic power of the U.S. means it would have more time to right itself before disaster.

Walker served as U.S. comptroller general from 1998-2008, heading the Government Accountability Office under presidents Bill Clinton and George W. Bush.

He’s been warning of fiscal troubles since 2007, when he told CBS’s Steve Kroft in a “60 Minutes” segment, “I would argue that the most serious threat to the United States is not someone hiding in a cave in Afghanistan or Pakistan, but our own fiscal irresponsibility.”