
Congress Bailout: General Motors Corp, Ford Motor Co and Chrysler LLC
By: Peter Chubb | November 18, 2008 | 26 CommentsIt is no secret that the American auto industry is in trouble, and yesterday the Senate Democrats have taken their first steps in a $25 billion bailout plan. The loan has a lot riding on it, as millions of jobs are in the balance, but hopefully the cash injection can help the auto industry ride out the storm.
There are only a few days left on this year’s congressional calendar, which does not give the lawmakers and the Bush administration much time to act. In the short amount of time that they do have, they need to finalize a plan to help struggling automakers such as Chrysler LLC., Ford Motor Co and General Motors Corp.
If the Senate bill gets passed, there would be certain conditions imposed. One of these conditions in exchange for aid is the government would take warrants for shares, this also comes with limits on things like executive compensation as well as prohibition on the payment of dividends. It is annoying that the taxpayer has to bail out these companies, as they have never thought about the taxpayer when they come up with extortionate prices for their vehicles.
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