Big Auto Companies Request Big Auto Loans From Big Brother

September 12, 2008 11:44 am Published by

Not very long ago, I posted a blog about the government providing cash to Fannie Mae and Freddie Mac, the big mortgage companies, to help keep the economy going and to help people finance their homes (see Bankruptcy’s Not An Option For Fannie And Freddie).  Now the big automobile manufacturers need government’s help.  In a way, this is help that will filter down to individuals and families.  As I pointed out in an earlier blog about car repossessions, Car Repos – In And Out Of The Driver’s Seat, most people absolutely need their car to get to work, and, without work, even their bankruptcy options are limited. 

General Motors, Chrysler, Ford, along with some auto parts makers have asked the government for loans, $25 billion worth, to develop and build more fuel-efficient vehicles.  As a bankruptcy attorney in Indiana, let me tell you, I’m extremely interested in every aspect of this request, because the automobile industry still employs tens of thousands of workers in our state.  These jobs are in jeopardy because, with the rising cost of fuel, there’s been a demand for smaller cars, and the manufacturing facilities aren’t yet set up to build the newer type automobiles.  My law practice serves 38 counties in Indiana, and in many of these counties there are specialty auto parts shops that could be positively affected if the loans are granted, along with the big plants such as GM Indianapolis and Delphi in Kokomo.

Congress is saying the loans are at the top of the list for discussion when members return to session.  If those loans are granted, the money would be used to build hybrid cars, plug-in hybrid cars, and electric cars.

I’ve often repeated that I’m no economist, and it’s certainly true that I’m no engineer.  One thing I do know, though, as a bankruptcy attorney in Indiana: Whatever helps people get or keep jobs, and whatever helps people own affordable, fuel-efficient cars – is bound to be of help to folks emerging from bankruptcy as they work to rebuild their finances.  And about that, I’ll say what Martha Stewart’s so fond of saying: “It’s a good thing”!

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This post was written by Mark Zuckerberg

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