Praise the Lord and pass the bailout buck

February 2nd, 2009 at 10:51am Annette LaCross

Published Dec. 21:

If the past few months were tense, the mood in Detroit must have been downright rapturous this weekend.

It gets to keep its automakers. Which seems to be OK, because nobody else wants them.

Despite President Bush’s tough talk about forcing two of the former Big Three companies into bankruptcy — a toothless threat likely meant to force concessions from General Motors, Chrysler and the United Auto Workers — he promised them more than $13 billion Friday, with $4 billion in reserve, from the Troubled Assets Relief Program.

To keep the money, the automakers must come up with a plan, by the end of March, to prove that they can show positive cash flow and fully repay the government loans. If they don’t, they have to give the money back.

But because both companies have said they are a whisper from bankruptcy — and that the bailout money is just enough to keep them in business through March — they won’t actually be repaying anything. Next stop, bankruptcy.

Of course, they just have to show a plan. They don’t actually have to accomplish anything. Which is also OK because the UAW, not surprisingly, is already objecting to the concessions outlined in Bush’s loan conditions and planning to make its case to President-elect Barack Obama.

I used to do that, too, when I was a kid. If Dad said no, I’d try for better luck with Mom. It never worked. My parents were too smart for that.

Luckily for UAW, however, there will be no such obstacle. Instead, there will be a Democratic administration in the White House.

Just to make sure everyone’s keeping up, let’s recap: Billions upon billions of dollars are being loaned to the automakers because they don’t want to file for bankruptcy. They have to come up with a plan that lays out how they will return to profitability. The only real timetable in the program is the one that requires this plan to be filed by March 31. The union is saying it won’t play along.

But the real issue is that two companies, which Bush said are so fundamental to the U.S. economy that he couldn’t let them fail now (March, apparently, is a different story), either can’t or won’t be profitable until someone else is keeping an eye on them.

So really, all Bush has done is put off the automakers’ bankruptcies until it’s someone else’s problem.

In the meantime, taxpayers will be part-owners in two bankrupt companies.

Only in America are you so richly rewarded for such abject failure.

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