December 5th, 2008
03:34 PM ET
6 years ago

President-elect's team weighing auto industry option

Obama and his advisers are studying options to help the struggling automotive industry.
Obama and his advisers are studying options to help the struggling automotive industry.

(CNN) – President-elect Barack Obama has kept a relatively low profile as automakers plead for billions from Congress, but behind the scenes, the incoming administration is working hard on finding ways to ease the crisis.

Obama and his advisers are studying options for helping the automobile industry beyond what Congress does or doesn't do before he steps into office.

Talks in Congress have included mention of a possible short-term loan for the auto giants to act as a Band-Aid until lawmakers can hammer out a long-term plan when the new Congress begins next year. Other lawmakers have suggested that bankruptcy could be a good thing for the automakers.

CEOs for the Big Three are trying to make their case for a $34 billion loan.

Despite what may happen in the coming weeks, there's no indication that the problem will be solved before Obama steps into office. While the president-elect has largely stayed silent on the issue, he has signaled that one option is off the table.

"We can't allow the auto industry simply to vanish," he said last week.

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Filed under: Candidate Barack Obama • Congress • Nancy Pelosi
soundoff (85 Responses)
  1. Dems be dopes

    Let's see..............

    We can save the jobs, unions, and workers so they can build expensive cars that won't sell...........

    Brilliant!

    December 5, 2008 05:46 pm at 5:46 pm |
  2. Buckeye

    This is no time for silence or just studying things. This is a time for immediate action and relief. I live right next to the GM Lordstown plant and our entire community in NE Ohio is threatened by this economic terrorism. Why the roaring silence?!

    December 5, 2008 05:46 pm at 5:46 pm |
  3. JL

    If the auto industry doesn't get it together and get it together fast, they are going to take a lot of businesses down with them, wiping out millions of jobs. I'm not too sure they have the time to wait for the government to bail them out...

    December 5, 2008 05:51 pm at 5:51 pm |
  4. Annika, IN

    A short term loan sounds good. I hope Congress doesn't let the CEO's make the decisions. They should give the money to an oversight committee, who will make sure the people have jobs. The CEO's are greedy and self serving lizards.

    December 5, 2008 05:52 pm at 5:52 pm |
  5. Phyllis, KS

    He's so cute, and he's got brains too.

    December 5, 2008 05:53 pm at 5:53 pm |
  6. Nancy, FL

    I love an honest man. America, we picked a good one.

    December 5, 2008 05:54 pm at 5:54 pm |
  7. carol in michigan

    the government gave the money to the banks, gm is only asking for a loan. in world war 2 gm made our military equipment. do you think honda and toyota will convert their plants here to make our military equipment if gm dies.

    December 5, 2008 05:56 pm at 5:56 pm |
  8. Tbone

    Why consider a bailout? The answer is–wait for it–J-O-B-S. What plan does anyone have for replacing 2-3 million living wage jobs? For all of the arrogant Monday morning quarterbacking (after all, who the heck was BUYING all of those SUVs?), all the vindictive internet chest-thumping, all the newly converted capitalists, no one has suggested a SINGLE plan to replace 2-3 million jobs that can support families.

    You people talk like you're punishing the executives or union heads. Do you honestly believe that either one of them is materially effected by bankruptcy? No, it's the WORKERS and their FAMILIES. If we can spend $750 Billion to support Wall Street, then I have no problem diverting 10% of that amount to directly support our workers.

    If we can spend $10 Billion a month to bail out Iraq, we can sure as Hell support our own people. Bring the troops home and spend the money creating jobs and rebuilding our infrastructure. The fat cats will always get over, but proving a point is a poor trade off for a 10% unemployment rate. Let's all grow up and try to think of solutions for the country–instead of recriminations for a few idiots.

    December 5, 2008 05:57 pm at 5:57 pm |
  9. Silence Dogood

    The people do NOT want a bailout of auto industry. Obama took a lot of money from big corporations. Let's see who Obama sides with.

    December 5, 2008 05:59 pm at 5:59 pm |
  10. Dale in White Bear Lake, MN

    Matt December 5th, 2008 4:21 pm ET

    Natural selection has its place. The Big 3 failed to adapt, faught against it tooth and nail even, so they must die.

    Actually they didn't "fail to adapt" that suggests that they tried to adapt, but in reality they didn't. The automakers refused to change with the times because it wasn't in the best intrest of their wallets. Now they want a bailout in hopes that they don't have to change whats making them money. What needs to happen is NO BAILOUT period. Let them go bankrupt and then rebuild from the ground up. Yeah this sucks for the people employed their but oh well, if we want our economy back as strong as ever some people will just have to suffer for the greater good of our country. And that is the biggest difference between now and back in 20's and 30's. People suffered but the endured it and look at what happend, things got better. Now people feel like they shouldn't have to suffer for this country which sickens me, suck it up and live with it.

    Have a nice day

    December 5, 2008 06:03 pm at 6:03 pm |
  11. Miykael Poly

    Don't bail them ALL out, let one fall and split the 34 billion between the two remaining standing.

    December 5, 2008 06:14 pm at 6:14 pm |
  12. Lorna Abbott

    I highly recommend that Obama have his team go to Ralph Nader's site and read his polices. They are exactly what we need in solving the problems that our country face now.

    He lays out each remedy with step by step actions. Unfortunately, such action would require our government to think out side the box. But our legislators feel uncomfortable with people who aren't team players. They want people to go along to get along. Also, they would have to give up pork amendment and perks.

    George W. Bush and the regime behind him have bankrupted the USA. The bailout money is his parting gift to the big guys. Unless major changes are made throughout all systems, (including government), we are going down.

    Fellow citizens, we are watching the fall of the American Empire before most Americans knew we had one.

    December 5, 2008 06:18 pm at 6:18 pm |
  13. ran

    Again we see the Democrats are a party of the people and workers. what are the Republicans doing and saying except give the money to the rich bankers and their shareholders.

    December 5, 2008 06:21 pm at 6:21 pm |
  14. Dennis

    The current crop of corporate CEOs–and not just the Big 3 CEOs–are characterized by greed, a vision that only extends to the next dividend distribution, and a complete lack of ethics. They get huge salaries and bonuses even as their company goes south, then they get a golden parachute when they bail on the company. What they have done to this economy borders on treason. All of the corporate takeovers and buy-outs that have occurred over the past decade or so need to be reversed so that never again can it be said that a certain company is too big to fail. Survival of the fittest; if you can't adapt, you die.

    December 5, 2008 06:32 pm at 6:32 pm |
  15. Jeff Spangler, Arlington, VA

    There are some things which even Harvard's Hope can't Change– an industry which has rendered itself obsolete and globally uncompetitive. Why isn't failure an option for a failed business model created by equally dumb and greedy managers and unions?

    December 5, 2008 06:35 pm at 6:35 pm |
  16. Griff

    Or is it just the Black Man's version opf the "Devinci Code"????
    There never was a God..... Pagans had a right to life, just like anyone else... I am a Direct decendent of Pagan's.... Celt's are my past... I am a True Viking Decendant... My beliefe.. AND I LOVE IT!!!!!!!!!!!!!!

    December 5, 2008 06:49 pm at 6:49 pm |
  17. Amber

    Considering they spent the last 30 years in the Oil Industry's pocket, I say let Big Oil bail them out or let them go to Chapter 11.

    December 5, 2008 06:53 pm at 6:53 pm |
  18. Democrat to the bone

    AS much as I hate the idea of another bailout, I believe its really the only option at this point. We CANNOT just let the industry vanish, it will make the situation even worse than it is right now. At the same time, there must must MUST be oversight to this loan, otherwise it will be just like throwing money in the garbage. The big 3 need to stop making crappy cars..plain and simple. They need to be more competitive otherwise there will just be bailout after bailout. I think there should also be a stipulation. One bailout and one only. If they don't use the money wisely, then they should be left to go bankrupt.

    December 5, 2008 06:58 pm at 6:58 pm |
  19. Sian

    December 5, 2008
    President- Elect Obama:
    I supported your candidacy during the Primary and General Elections. I supported you with my time, my energy and my voice. My support was based on your promise that you are for the betterment of the United States of America. You said you would listen and I am asking you to listen now. Please let Ford, GM, and Chrysler file for bankruptcy. That is the only way that you will be able to effectively rid these companies of inflated union contracts, exorbitant Executive Compensation Packages and over-exaggerated egos.
    This problem does not exist only with the Big 3 it exists in government as well. You ran your campaign on the premise that government is broken and you would do your best to fix it. You understand government and its inner workings. So much so that you were able to overcome strong odds and become the leader of this country. Well, as someone who has studied and worked with some of the most successful companies in Corporate America I am asking you to ponder my request. If these contracts are not thrown out these companies must become profitable in a very short period of time, in order to sustain the commitments they have already made.
    CEO’s agreeing to work for $1 per year may have no impact on their bonuses, depending on how their contracts were written. If they are forced to file bankruptcy they will finance their restructuring under the guarantee newly set in place by that $700B bailout package, only that all contracts currently in place will be void. That will be time enough for the government to step in with an emergency loan order to save jobs. While these CEO’s are pleading their case no one is minding the shop, leaving Toyota and Honda to plan for another day. Put their noses to the grindstone and force them to do what they were hired to do. Move the company ahead. That’s what all leaders are expected to do. Think one step ahead of the rest. That’s why you were elected and why they were hired.

    Sian

    December 5, 2008 06:59 pm at 6:59 pm |
  20. Kathy

    All 3 need to face bankruptcy and start over without the Unions. We work too hard for our money to throw it away on companies and CEO's who got caught up in greed and lost their way. Average Americans face bankruptcy everyday and many of them survive. They need to be taught a lesson. I'm sure BO will bail them out regardless of what the American people think, afterall the Unios supported him during his campaign, now it's payback time. Politics as usual.

    December 5, 2008 07:08 pm at 7:08 pm |
  21. unbeliveable

    let them start over.

    December 5, 2008 07:08 pm at 7:08 pm |
  22. Drew

    Well what congress needs to do is study a way to prevent online sales from killing jobs can causing most business to close.

    Online sales is a more dangerous venom than the big 3.

    But no one sees it that way.

    December 5, 2008 07:22 pm at 7:22 pm |
  23. Al, California

    Economic shock therapy worked so great to destroy and rob other countries, but when it comes back to us ourselves, here on edge of complete collapse, we are starting to think... (I don't mean crazy extremists like Bush/Cheney, I mean we reasonable citizens can think...)

    A good book: "The Shock Doctrine. The Rise of Disaster Capitalism", by Naomi Klein. Read it.

    December 5, 2008 07:28 pm at 7:28 pm |
  24. democrat with a small "d"

    The auto industry will not vanish. Only the big three. But hey, if they had listened to George Bush and others three years ago and started developing more fuel efficient and smaller vehicles THEN, they wouldn't need to be begging from the taxpayers now.

    December 5, 2008 07:28 pm at 7:28 pm |
  25. No Hillary = No Obama

    Forget about it. Let them go under.

    December 5, 2008 07:37 pm at 7:37 pm |
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