In conclusion,
In conclusion,
The government bailout of General Motors (GM) and Chrysler between 2008 and 2009 coasted taxpayers approximately $23 billion. President Barack Obama emphatically defends his decision to subsidize the automakers, arguing it was necessary to prevent massive job losses. Even if one accepts this premise, the government should and could have executed the bailout more efficiently, with no cost to taxpayers, had the Administration required the United Auto Workers (UAW) to accept standard bankruptcy concessions. Instead, the Obama Administration gave special treatment to the UAW above and beyond what other creditors and unions received:…
The Obama administration had to make the call: Bail the automakers out? Or let them go bankrupt without the bailout?…
In the fall of 2008, General Motors, Ford and Chrysler-known for decades as the Big Three encountered a very serious automotive industry crisis that they haven’t met before. This unprecedented crisis made these three leading companies in automotive industry step at the edge of bankruptcy. Facing this critical problem, automotive companies can not deal with this severe difficult situation all by themselves then they turn to the United States Federal Government for help not only once but several times. According to a report published by Center for Automotive Research in the United States, the United States Federal Government successfully avoids a lose of 28.6 billion dollars by offering assistance to automotive manufacturers in this crisis. Even though this amount of money can not be comparable with the tremendous amount of money the United States Federal Government loaned to the automotive industries, it does demonstrate that the government has done something really helpful and successful in term of the outcome of this action and the federal government’s functions in some extent. Therefore, as far as I am concerned, the United States Federal Government should have assisted the automotive manufacturers from going bankrupt. Then I will illustrate my reasons to support my opinion in the following statement.…
President Obama also supported a 2009 bailout of the auto industry, despite critics who believed that the government should stay out of free enterprise and let the cards fall where they may.…
The economic recession that hit the US in 2008, left a lot of Americans with a bad taste in their mouths, including me. The way the government handled the situation was not overwhelmingly popular. Nevertheless, after doing quite a bit of reading, when one looks at the facts of how it all transpired, it appears like the facts…
Our economy emerged from the recession back in 2009; however, the economy didn’t grow much since then. According to the Bureau of Economic Analysis, gross domestic product (GDP) for the first quarter of 2011 grew only 0.4 percent while the second quarter grew at 1.3 percent. The increase in the second quarter can be attributed to a decrease in imports of petroleum, auto, and engines due to the earthquake in Japan, an increase in federal spending for national defense, and increase in business investment. However, it didn’t rise as much because of decrease in consumer spending, especially in auto vehicles and parts. (Bureau of Economic Analysis)…
This meant untold thousands of jobs, and a trickledown effect of increased jobs for supply chain vendors. That, and the massive amounts of money spent on infrastructure to support these vehicles led to an increase in the economy. As long as factories are based in the US, all of money…
The big three American automobile companies are showing considerable operating loses. GM is losing $1 billion or more a month. How does a capital injection help? The companies will just burn through the cash (using it to pay labor or pay off debts, old and new, until it is gone). The banks, on the other hand, that are receiving bailout funds have operating profits, they can borrow low and lend high, but suffer from capital requirement issues, which limits what they can lend. A capital infusion helps meet capital requirements, frees up lending and the banks can make a profit. Auto companies are not similar. Unless the auto companies can build and sell a…
Annotation: The economic crisis negatively affected every American in some way or another. Companies such as GM and Ford saw a great reduction of sales from the financial chaos. 2008 was the year that the motor companies were given the opportunity to benefit from TARP. GM restructured their company’s $62 billion debt through borrowing from TARP up to $18 billion through the end of 2009. There was a loss of over 100,000 jobs and a total of nine plants were closed (Cooney et al., 2009). This article discussed the economic crisis and how government intervention affected the motor vehicle industry.…
Many people lost their job now because the company does not trust the United State economic is so bad by then. We should try and bring all the jobs back to the United State by try giving them taxes credit so that they stay in the United State and not go over sea were all the job are going. They should give them loans that they can employee more people and put American back to work. This bailout would not hurt the state or the banks if the invest in the United States people. It is winning for all side of this bailout.…
The problem with having large concentrations of wealth and dependence upon two industries is the economy relies on those industries to expand, grow, and invest in order to prosper. At the time, the main problem with the automotive and radio industries was that they could not expand because people could and would only buy so many cars and radios. When those industries went down, they took the American economy with…
In conclusion I agree with many of the aspects Equality presented. General Motors was already given assistance; they need to be given the chance and motivation to try to rescue themselves. In history it’s been proven that the economy will right itself, government involvement has a tendency to make the situation worse.…
First to consider is the fact that, being one of the largest manufacturing industries in the US, the collapse of these auto giants would not only damage the US economic competitiveness worldwide, increase unemployment, and weaken the U.S. Dollar, but it could potentially destroy entire communities throughout the regions of the U.S. which rely so heavily on the careers provided by the auto industry (Michigan through Pennsylvania) by eliminating their economic foundations. Ideally, this auto bailout is protection for the people living in these regions. Yet another thing to consider is that, as global economic recessions progress further, a dog-eat-dog market evolves gradually in which each country takes steps to strengthen its own economy without focusing on what is happening in a worldwide sense. This introspective, somewhat selfish outlook typically results in measures taken which may only appear valid inside that country’s borders. The auto bailout carries with it the idea that a collapsing manufacturing industry will send a shockwave throughout the economy and weaken the national currency. Since the U.S. Dollar is also one of the primary reserve currencies around the world, a weakened U.S.D. will not only affect our economy’s buying power, but devalue world reserves and have the heightened possibility to drive the global recession even further. While seemingly irrational to some observers, the intention…
How did this all come about? First General Motors filed bankruptcy in the spring of 2009. The reason why General Motors went bankrupt was because they didn’t manage their money properly. It’s as simple as that. General Motors ran out of money and needed to be bailed out by the government. The decision to bailout this company came from several sources in government. Barack Obama was the President who was responsible for pushing this action. However, it was the Congress who passed the bill to bailout General Motors.…
The Chrysler Bailout and the Challenger Disaster are two examples of possible outcomes when implementing a strategic decision-making process. Without the presence of a decision‐making model a successful outcome is extremely unlikely. Chrysler’s decision to secure subsequent loans from the government resulted in success because it used a judgmental approach in search of a satisficing solution.…