The U.S. government has given automakers and suppliers close to $80 billion in totalEnlarge Photo
In total, the U.S. government has given automakers and suppliers close to $80 billion, and while the government claims that this money has given the companies a good chance to succeed while preserving American jobs, there is also the question of whether taxpayers should have to foot the bill for private enterprises.
The government defended its decision, stating that the public had a reasonable chance of getting a return on its investment. Furthermore, even if GM or Chrysler somehow manage to find themselves bankrupt again, the federal government believes that the bailout given will be the last money the two automakers will require - although it won't rule out the possibility of more bailouts in extremely extenuating circumstances.
As a major stakeholder in GM and Chrysler, the federal government finds itself in the tricky position of not wanting to run the business but also keen to see it succeed. As for how long the government plans to remain a major shareholder, Ron Bloom, a senior adviser to the automotive task force explained to the Associated Press that the situation will depend on the financial markets.
Despite obvious opposition from a number of angles, the White House has implied that without the bailout of GM and Chrysler the ripple effect of a complete bankruptcy of these two companies would have had profoundly negative effects on the U.S. economy.