President Bush tossed General Motors and Chrysler a temporary lifeline from the taxpayers on Friday, announcing $13.4 billion in emergency loans to prevent the collapse of the companies, with another $4 billion to become available in February. The president’s plan gives carmakers until March 31 to restructure. G.M.'s Wagoner Discusses Bailout Related Stocks Jump, Then Slide Back, After Auto Bailout (December 20, 2008)
Members of the United Automobile Workers in Warren, Mich., learn about coming layoffs from General Motors. The White House is seeking concessions from workers and management.The loans, conditioned on G.M. and Chrysler undertaking sweeping reorganizations plans to show that they can return to profitability, are meant to keep the companies afloat until March 31. At that point, the Obama administration will determine if the automakers are meeting the conditions of the loans and thus will continue to receive government aid or must repay the loans and face bankruptcy. “These are not ordinary circumstances,” Mr. Bush said in televised remarks that quickly touched off a debate over the fairness of his plan. “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.”
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