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Auto Bailout Paper

Auto Bailout Paper - Wegmann 1 Dylan Wegmann English 1001...

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Wegmann 1 Dylan Wegmann English 1001 Mr. Schmitt 10 November 2009 Auto Industry Bailout The transition from President George W. Bush to President Barack Obama has not been an easy one. The U.S. economy was and still is suffering and we can only hope our new office has what it takes to pull it together. President Obama has faced many tough decisions already in his short tenure as the commander-in-chief. From whom he hires to be in his personal cabinet to the country’s healthcare issue, our president does not have it too easy. With much of the media and U.S. citizens questioning his decisions he has a lot of pressure to please everyone. One of the main issues he has faced is the automobile industry bailout. But this issue does not come down to President Obama; it comes down to Republicans vs. Democrats in Congress. Basically, Republicans do not wish to bailout the American auto industry, but want to solve the economic crisis in other means. The Democrats, however, wish to loan money to the auto industry and hope to convince some Republicans to vote the same to get the bill passed. That’s where the problem is; it seems neither party will budge. Chapter 11 of the Bankruptcy Code is the chapter that is usually used for reconstruction of any company, industry, or individual. Normally under Chapter 11 a bankrupt group or person would devise a plan to reorganize its business and pay its lender back throughout a certain amount of time (Chapter 11). The Chapter 11 scene all started back in the 1800s when railroads needed to be economically rebuilt and eventually was used for airline and steel companies (Fox). Now with the American auto industry in serious trouble most would think that Chapter 11 would be a good option for these certain companies. But CEO of General Motors, Rick Wagoner, thinks that Chapter 11 cannot be an option. Lawmakers heard three reasons from Wagoner on why he
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Wegmann 2 thinks this way. The first reason is that the money that is used to reconstruct companies is few
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Auto Bailout Paper - Wegmann 1 Dylan Wegmann English 1001...

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