Has the $700 billion GM/Chrysler bailout been a good investment?

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MooseyFlathead

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Mar 19, 2009
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I am not asking whether or not it was Constitutional. Please answer just from an economics perspective.

Personally, every time I have invested in failing companies it was a disaster. Are our politicians investment gurus or pretty much detached from reality?
Carls is correct. Gm/Chrysler got only a portion of the 700B.
Doc, I agree that we should not ignore constitutionality. It just that I know the answer to that issue.
 
Someone pointed out that their bailout wasn't $700 billion, it was chump change in comparison. All of these bailouts, though, imho, are like pouring kerosene on a fire. Basically, the banks were reimbursed for fraud and mismanagement. GM and Chrysler have proceeded to file bankruptcy anyway, so essentially, we have given foreign corporations billions of American taxpayer dollars in exchange for nothing. Not one job has been saved or created as a result of the bailouts. We should have received stock in those corporations and then distributed the stock to the people putting up the money, now that would have altered some economics.
 
My answer to your question is yes because there are a lot (estimated 3 million) of "supplier" company's that would surely have gone out of business with out the bail out money. (It was really a loan by the way because bailout money does not always have to be paid back) GM only got 50 mil and I am not sure how much Chrysler ended up with but in any case I do believe it was worth it beacuse I feel like my job is at least as important as the white collar executives at the financial institutions who got bailout money too and they got the money without having to sit in front of congress and explain why they should get it and how they intend to "Rebuild" their companies in order to pay the money back. Just my opinion, thanks for asking this question, this has been bugging me for a long time now. Yes they are all pretty much out of touch because I think you would have to look pretty hard to find one of those people who knows the price of a gallon of milk with out having an aid go look it up.
 
Always the pessimist never have solutions - you must be a Red state Republican .
I hope it works - I would Hate to see millions of people out of work and no doubt their homes .
I know Republicans could care less .
 
I'm not sure any investor worth their salt would expect to get returns on an investment months after the investment is made. Come on. Find something worthwhile to hit Obama and his fans....it takes no brains to answer this one.
 
Investment? Not good. When Studebaker went out of business, South Bend never recovered. The same thing could happen to a number of other cities if the auto industry would fail, so there is more at stake than just return on investment.
 
No. It hasn't. Most of the money was used to pay bonuses to irresponsible ex CEOs and to continue funding their lavish lifestyles. There was no oversight which allowed the companies to continue manufacturing non-competitive cars and for the banks to continue investing in risky corrupt businesses.
I reread the constitution. I read it atleast once a year and no where did I see that the taxpayer is responsible for paying for the carelessness of the private sector.
 
Their just bailing out their supporters, Im surprised they haven't bailed out Madoff yet.
 
Given the fact that I wasn't consulted on whether or not I wanted my tax money to be used for such an endeavor, I wouldn't call it an investment. I'd call it downright THEFT.
 
If they are going to get money back, and taxes from workers, YES!

Or do you prefer the alternative... millions added to the unemployment benefits cost (indefinitely) and joining welfare. We would be losing our biggest industry (manufacturing) and it would hit so many down the chain, it would snowball into a full fledged depression. Auto workers, suppliers, distribution, shipping, salaried, etc jobs would be vanished with nothing to replace them. That cost would easily exceed trillions of dollars.

*Note that Bush knew of the problem this around this time last year, opting to do nothing about it (swept under rug for next administration) due to it being an election year.
 
Well GM and Chrysler got like $20 billion combined. The $700 billion was for the banks not the Auto Companies.
 
Of course not. The UAW makes the cost of labor astronomical. It's cheaper to build the cars over seas and ship them here! Grasp that. Plus, they're business plan is no different and now will be worse when the run out the Chrysler Obama that no one will want to buy. Furthermore, I know of many people, myself included, who will NEVER buy from Government Motors.

By the way, you CAN'T ignore the fact that this was/is unConstitutional.
 
Of course not. The UAW makes the cost of labor astronomical. It's cheaper to build the cars over seas and ship them here! Grasp that. Plus, they're business plan is no different and now will be worse when the run out the Chrysler Obama that no one will want to buy. Furthermore, I know of many people, myself included, who will NEVER buy from Government Motors.

By the way, you CAN'T ignore the fact that this was/is unConstitutional.
 
It's been great for the auto industry executives and the UAW, otherwise for the American public it absolutely sucks !
 
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