Sunday, November 9, 2008

Pelosi, Reid take Mortgage Money give some to the Auto Industry

Pelosi, Reid Press for TARP Aid for Auto Industry -

WASHINGTON -- House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid sent a letter to Treasury Secretary Henry Paulson urging him to assist the Big Three auto makers by considering broadening the $700 billion Troubled Asset Relief Program to help the troubled industry.

The two top Democratic leaders in Congress are likely to make the request in a letter to the White House, which could be forwarded as soon as Saturday afternoon, said individuals familiar with the matter. President-elect Barack Obama is generally supportive of the appeal, but at the moment is moving on his own track to assist the industry, these individuals said.

Helping out the auto industry

Here we go, Reid and Pelosi wants to use the $700 billion, which is marked for the banking industry and give part of it to the auto industry. I thought we needed this money to improve credit flows and calm turmoil in financial markets incited by the downturn in the housing economy. Congress has already authorized a $25 billion loan package meant to help the industry retool to meet higher fuel economy standards. And already the Democrats want to take money from one source and give it to another. Share the wealth.

On October 27th John McCain said “Let’s get the first $25 billion to them first, see how that works before we say we’re going to give you some more.” The Democrats don't even know how much money the auto makers need, just throw money at the problem to solve it. Or are they taking the auto makers at their word of how much money they need?

How did the Bush administration and Congressional leaders, Reid and Peolsi, come up with the $700 billion to buy distressed mortgages? Answer; The recovery package cannot go higher than $700 billion without additional legislation. As for that figure, it lies between the optimistic estimate of $500 billion and the pessimistic guess of $1 trillion about the cost of fixing the financial mess.

So we don't know how much it will cost us, the tax payers, to fix the mortgage crises but we can take $25 billion of it and give it to the three US auto makers. What about the other auto makers here in the United States? Toyota, Honda, Nissan, Hyundai all have plants here in the States and employ American workers. States give them tax cuts so they can build a factory in their state. Are we going to help them? Or do they need help?

How is the President-elect going to help the auto industry? Obama said the auto industry would benefit from his $150-billion, 10-year plan to develop alternative energy sources, including fuel cells to power vehicles. So does the auto industry needs the $50 billion that Reid and Pelosi wants to give them or can they wait for the $150 billion that Barack Obama will invest in alternative fuels? Will the cars built with the $50 billion run on the $150 billion alternative fuels?

When it comes to our money, the Democrats know how to spend it. One thing we have learned from the Democrats here is, to fix a problem, just throw money at it. Money is the magic pill that cures all. Let's just do what John McCain said. First loan them the $25 billion and lets see what happens. Then make a decision later on how they used the first money. Sounds smart?

More post on economy.
Global Economic Slowdown Predicted by G7 Countries
Job Lost for First Time Since 2003

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