Our horribly mismanaged US auto makers want a $50 BILLION Bailout from US taxpayers like me and you:
Automakers plan to urge Congress to support funding up to $50 billion in low-interest loans over three years to help them modernize their assembly plants and develop next-generation fuel-efficient vehicles.
Industry officials said the loans, twice the amount authorized in last year’s energy bill, will be a top priority when Congress returns next month because of the declining fortunes of Detroit’s automakers and tightening credit markets.
“The amount of concern and urgency from the Detroit companies has increased in the last month and significantly ratcheted up what they’re communicating what their funding needs are,” said Alan Reuther, legislative director for the United Auto Workers union.
But before you write them a check for these monies, place a few conditions on any “loans” they receive:
1. No more outsourced jobs to Mexico or elsewhere. You get Federal money, you hire American workers. Violation of any of these terms and conditions would constitute an immediate default under the loans.
2. Let the rich bear some of the pain of this “investment” by raising taxes on millionaires to fund the bailout.
3. Give the labor unions and the Federal government veto power over any attempts to use money for anything other than R and D or development/production of alternative energy vehicles (like bonuses to executives who don’t deserve them, e.g.).
4. Put Federal Regulators or hire outside Financial consultants/CPA’s onsite as federal watchdogs to ensure proper use of the funds. Improper use of funds would constitute an immediate default of the loans.
5. Prohibit use of funds to pay dividends to shareholders, bonuses to executives, to buyback stock or to finance anything unrelated to the specific purpose for which the loans are being made.
6. Any default on the loans would immediately allow a sufficient number of the Board of Directors to control the defaulting company (whether that may require a simple or super-majority) to be replaced with directors acceptable to both the feds and labor unions until such time as the loans were repaid in full or the labor unions agreed to waive this requirement.
7. Require any default on the loans to annul any “golden parachutes” or other special compensation owed to management executives upon termination under their employment contracts at the discretion of the new Board of Directors (see #6 above) and require executives with such compensation provisions in their contracts to waive those agreements prior to receipt of any loan funds.
8. Require all Executive bonuses to be paid in stock options not executable until the loans are repaid in full, unless otherwise waived by a majority of both houses of Congress.
These are standard provisions a Venture Capitalist Firm would require before making an investment in a troubled company. I’m sure you can think of a few more terms and conditions, or other ideas, to make certain this form of corporate welfare doesn’t just benefit the corporate titans and investors on Wall Street, but actually goes to fund the purpose for which it is is intended. Feel free to add them in the thread below.
