Bush approves $17.4B automaker bailout

The Bush Administration today has approved an emergency bail out for the Big 3 US Automakers to the tune of $17.4 billion. Bush said “it would worsen a weak job market and exacerbate the financial crisis,” if a bailout was not implemented. President-elect Barack Obama also praised the bailout. $13.4 billion will become available within the next two weeks or ago, while the remainder will become available in Jan. There are reports an additional $4 billion could become available in Feb 09. GM will get the most out of the plan with $9.4 billion; the rest will be split evenly between Ford and Chrysler, who will get $4 billion each. The Big 3 need to particularly reduce labour costs and build better vehicles to sustain their companies in the future, otherwise, we run the risk of more bailouts, and ultimately the insolvency if these fundamental problems are not addressed. I personally believe we all needed this bailout as the collapse of the automakers would have caused significant and irreversible harm to everyone particularly in the US and Canada. Please see this report that highlights possible job losses if the automakers went under, and my article that highlights my thoughts on a GM bailout.