Do You Want to Pay Billions to Keep Car Companies Alive?

Reader Contribution by Staff

According to a new poll from the Pew Research Center, 63 percent of Americans disapprove of the government giving billions of dollars in loans to Chrysler and General Motors in order to keep the struggling automakers afloat. 

Currently, officials from the Obama administration are reviewing the automakers plans for restructuring (aka downsizing and going green). So you can expect a lot more about the auto bailout to be in the news in the coming weeks. 

As much as I think the domestic automakers are largely responsible for their dramatic decline, I worry about the everyday Joes and Janes who will be affected if any or all of the domestic automakers go under. It’s also ironic that as AIG hands out $100 billion in bonuses (paid for from the bailout funded by our taxes), it seems there’s a tough road ahead for the automakers to get any more than the $20-some billion bailout. In the end, I think the Big Three (Chrysler, Ford or General Motors) are going to become two, maybe even one, in order to survive.

Does anybody really know the difference anymore between $100 billion and $200 billion?

What do you think? Should our tax dollars keep Chrysler and General Motors alive? Are they victims of the times? Or have they dug their own graves through bad management, focusing on SUVs despite all the writing on the wall about higher gas prices, etc.? Will you ever again buy a car from Chrysler, Ford or General Motors?

Share your thoughts by posting a comment below.

Update, 3/27/2009

This just in from The New York Times:

The Obama administration is likely to extend more short-term aid to General Motors and Chrysler on Monday, but impose a strict deadline for bondholders and union workers to make concessions that would help the ailing automakers become viable businesses and avert bankruptcy.

For more information, read U.S. Expected to Give More Aid to Automakers.

Update, 3/30/2009

From The New York Times:

The White House on Sunday pushed out the chairman of General Motors and instructed Chrysler to form a partnership with the Italian automaker Fiat within 30 days as conditions for receiving another much-needed round of government aid.

The decision to ask GM’s chairman and chief executive, Rick Wagoner, to resign caught Detroit and Washington by surprise, and it underscored the Obama administration’s determination to take a hands-on role in the companies it is bailing out — a level of government involvement in business not seen since the Great Depression.

President Obama is scheduled to announce details of the auto package at the White House on Monday, but two senior officials, offering a preview on condition of anonymity, made clear that some form of bankruptcy — a quick, court-supervised restructuring, as they described it — could still be an option for one or both companies.

For more information, read Obama Issues Ultimatum to Struggling Automakers.