Grant

John, I can mass delete them, but I will not read them to determine which you may want to keep. If you want a mass delete, send me a specific email request to do so. (I call it a CYA letter)

The return on investment for the public from the restructuring of the domestic auto industry was extraordinary. Federal, state, and local governments saved between $10 and $78 for every dollar invested in the auto industry restructuring plan. Federal taxpayers are likely to recoup most or all of their investment in GM, and will enjoy a net gain of at least $61 billion on their $5 billion to 7 billion investment in the auto industry recovery plan. This was a very savvy investment, at a time when failure to intervene would have been catastrophic for the domestic economy. The General Motors Company completed the largest global initial public stock offering (IPOs) in history this week (November 18). The U.S. government sold nearly half its stock holdings, which puts it well ahead of schedule for exiting from ownership of the company. The proceeds from the stock sales alone (Thursday’s and the expected returns from the ultimate sale of its remaining 500 million shares in the company) will pay back most or all of the U.S. government’s initial $49.5 billion investment in GM (Welch, Spears and Trudell 2010). Overall, the government may lose only $5 billion to $7 billion on the entire recovery plan (Trudell 2010) after GM and Chrysler are privatized again. This report, however, shows that this investment resulted in far larger savings to the economy, and to federal, state, and local budgets. Without the aid of the government-assisted restructuring, one or more of the Big 3 domestic automakers would have collapsed. Between 1.1 and 3.3 million domestic jobs would have been lost, resulting in the loss of 0.5% to 3.0% in GDP in each year between 2009 and 2011, which would have sharply increased federal, state, and local budget revenues. This report shows that the auto recovery plan resulted in net savings to the federal government of between $70 billion to $389 billion in this period, and an additional $24 billion to $126 billion in savings to state and local government. In other words, the $5 billion to $7 billion not recouped via stock sales and loan repayment is offset many times over by the $94 billion to $515 billion in net savings to government.

12/19/08 President George W. Bush stepped in Friday to keep America's auto industry afloat, announcing a $17.4 billion bailout for GM and Chrysler, with the terms of the loans requiring that the firms radically restructure and show they can become profitable soon. "If we were to allow the free market to take its course now, it would almost certainly lead to disorderly bankruptcy," Bush said at the White House, in remarks carried live by the national broadcast networks. "In the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action. The question is how we can best give it a chance to succeed." Bush said that "bankruptcy now would lead to a disorderly liquidation of American auto companies." "My economic advisers believe that such a collapse would deal an unacceptably painful blow to hardworking Americans far beyond the auto industry. It would worsen a weak job market and exacerbate the financial crisis," he said. "It could send our suffering economy into a deeper and longer recession." The money will come from the Wall Street bailout passed by Congress, a reversal for the White House. President-elect Barack Obama and Democrats had long advocated that course, and Bush had resisted it. Of the total, $13.4 billion will be paid out in December and January, administration officials told reporters in a briefing. The last $4 billion is contingent on release of the second installment of the Wall Street bailout funds by Congress. As it happens — in a source for some potential confusion — this breakdown also corresponds with how the money will be divided between GM and Chrysler, the two major recipients. Treasury estimates GM will require about $13.4 billion in loans; Chrysler $4 billion. Both companies will share in the first $13.4 billion paid out in December and January. GM will need the last $4 billion as well. The government gets a stake in each company, and can call in the loans on March 31 if the firms cannot prove "viability" by then. The manufacturers do not have to be profitable immediately but have to be "profitable soon," a senior administration official said. The structure largely follows the pattern of legislation that failed in Congress last week in the Senate because of Republican opposition. Bush made no mention of this fight, but in stepping in as he is, the president risks angering conservatives in his party but the administration felt it had no choice given the fragile state of the economy. In doing so, Treasury decided not to be tied to the initial bill in Congress that provided only $14 billion in loans. That was always viewed as inadequate to get to March 31, and the administration opted to go with more realistic numbers. In doing so, however, it sets up a ticklish situation for Democrats in the new Congress. With the auto bailout, Treasury will have tapped out all of the first $350 billion from the financial markets rescue fund by late January. That means Democrats must deal with releasing the second $350 billion even as Obama will be trying to rally support for a large economic stimulus bill. On the Republican side, the real dividing point between the administration and bailout critics in Congress has had more to do with the conditions imposed on the loans — not the aid itself. These differences came to a head in the Senate over the question of how to treat the United Auto Workers, and what pressure should be put on the union to bring down wage levels to match those paid to non-UAW workers at US plants operated by Honda or Toyota for example. Senate Republican conservatives insisted that the UAW agree to specific wage adjustments by a date certain in 2009. When the union rejected this demand as political, Republicans killed the bill. The White House agreed that wage concessions would be needed but thought the better test should be the viability of the companies — not some fixed formula imposed on management and the union. There was real discomfort in the administration with what many saw as a regional, anti-union slant as Republicans from the South — where non-UAW, foreign owned plants are more common — demanded concessions that jeopardized aid to an industry so vital to much of the Midwest. Thus the loan agreements drafted by Treasury take a more flexible approach. There are “Restructuring Targets” to be met in the companies’ recovery plans, including moving to a more competitive wage structure by the end of 2009. But there is also some leeway if alternative savings can be found. The restructuring report due March 31 “shall identify any deviations from the Restructuring Targets and explain the rationale for these deviations, including an explanation of why such deviations do not jeopardize the Borrower’s long-term viability.”

All servers are down. Tech services is on the job!

Howard Davies 80cc motorcycle

I hate it when that happens!

As I recall, he used to be a pilot for Pan Am. But I thought he died in a boating accident?

You felt a 3.6? A 3.6 actually made the news? Did it feel like someone slammed the door? Call me when you have a 6.6

Ok Ok I'll take it...please!

Check your fuel filter, and fuel flow. If less air allows it to run the air/fuel mixture is not correct.

So you will not take offense when I wish you a Happy Chanukah?

Temperatures here are dropping also. We might have to roll the windows up tonight.

Turn it in to your insurance and let them mess with it. Thats why you have insurance, its there job to sort out the other guy not yours!