If you believed all the talk from Chrysler about how our tax dollars would help finance its fast-track electric-vehicle future, you're in for a big disappointment.
Chrysler has disbanded the engineering team that was trying to bring three electric models to market as a rush job, Automotive News reports today. Chrysler cited its devotion to electric vehicles as one of the key reasons why the Obama administration and Congress needed to give it $12.5 billion in bailout money, the News points out.
The link is here and I thank John Nye for the pointer.
So can we get our money back?
The head of the task force making the recommendations on GM and Chrysler indicated some weeks ago the decision on Chrysler was a close one and hinged completely on the Fiat deal, and the prospects of saving tens of thousands of jobs if Fiat could keep some of the Chrysler factories and dealers open.
Think of it this way. Someone on unemployment (now for 99 weeks, or two years if you add in vacation/holiday time) will get I’m guessing more than $20,000 in benefits. That’s directly $20M per thousand. 100,000 jobs “saved” is at least $2B in benefits. Add even a small share of homes saved from foreclosure or forced sales. Add in the number of people who are able to delay retirement and drawing Social Security. Add in the number of people able to delay liquidating their 401K or drawing pension which forces sales of stock and bonds, driving down equity prices. Add in the stores closed and jobs lost, and those unemployment benefits.
The hedge fund that owned Chrysler, its bond holders, and others took big hair cuts for their investments in Chrysler, so I’m curious who will walk away from the deal smiling and saying, “now what high risk deal can I make which Obama will bail me out of now?”
Without Fiat closing on the deal, Chrysler would have been cut lose and would have certainly been liquidated in bankruptcy, with the only bailout it got coming from Bush.
Didn’t Chrysler make the same promise to the Bush administration in order to get the loan last August?
good bifocals on line
a pair of glasses every year
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