BREAKING: US Federal Gov't Gives Detroit Big Two $13.4 Billion

[thebobman]

FULL STORY @ CNN.COM

Feds to lend $13.4 billion to automakers

WASHINGTON (CNN) -- The federal government will provide $13.4 billion in loans to automakers General Motors and Chrysler, the White House said Friday. An additional $4 billion may be available in February, the Bush administration said. A senior administration official briefing reporters said he expects that GM and Chrysler officials will be signing the loan papers to access the cash lat Friday morning. Ford Motor Co. is in a better financial position than GM and Chrysler and is not included in the loan plan.

"Allowing the U.S. auto industry to collapse is not a responsible course of action," President Bush said Friday morning. Financing will be drawn from the $700 billion Troubled Asset Relief Program, the White House says.

"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says. The government will put other conditions on the loans, Bush said Friday, including making pay competitive with foreign automakers with large U.S. operations such as Toyota and Honda. Employees of foreign automakers generally make less than those in U.S.-owned plants. The plan also puts limits on executive compensation and perks such as corporate jets, requires the automakers to adhere to fuel efficiency and emission standards and open books to government scrutiny.

Sen. George Voinovich, R-Ohio, co-chair of the Senate auto caucus, thanked Bush for acting. "I am grateful the president stepped in to help thwart a disaster that would have sent our state over the cliff," Voinovich said. "... there are millions of hard-working Americans today who can breathe easier this holiday season."
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SIDE NOTE: CANADA NOW ON THE HOOK FOR $2.8 BILLION BAILOUT

Full Story @ autoblog.com
With all signs pointing to White House action on an automaker bailout despite the the bill not making it out of the Senate last Thursday, Canada has its taxpayers' wallets on standby as well. Our neighbors to the north account for a 20% share of the auto industry, and both the federal and Ontario governments are ready to add a commensurate amount of money to the bailout pot if U.S. government action does take place. So, assuming President Bush instructs Henry Paulson, the recently-crowned King of All Our Money, to give Detroit $14B out of TARP to tide them over and keep the RenCen escalators running until this all officially becomes Obama's problem next month, look for an additional $2.8B or so to float across the Detroit River.