Bush to Make Emergency Auto Loans

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A quick look at the proposal, and it looks to be remarkably non-punitive.

Politico has the bullet points:

Binding Terms and Conditions: The binding terms and conditions established by the Treasury will mirror those that were voted favorably by a majority of both Houses of Congress, including:

  • Firms must provide warrants for non-voting stock.
  • Firms must accept limits on executive compensation and eliminate perks such as corporate jets.
  • Debt owed to the government would be senior to other debts, to the extent permitted by law.
  • Firms must allow the government to examine their books and records.
  • Firms must report and the government has the power to block any large transactions (> $100 M).
  • Firms must comply with applicable Federal fuel efficiency and emissions requirements.
  • Firms must not issue new dividends while they owe government debt.

Targets: The terms and conditions established by Treasury will include additional targets that were the subject of Congressional negotiations but did not come to a vote, including:

  • Reduce debts by 2/3 via a debt for equity exchange.
  • Make one-half of VEBA payments in the form of stock.
  • Eliminate the jobs bank.
  • Work rules that are competitive with transplant auto manufacturers by 12/31/09.
  • Wages that are competitive with those of transplant auto manufacturers by 12/31/09.
    • Note that wages here means all forms of current and past employee remuneration, or at least it does to Bush and His Evil Minions™,and so would have the effect of competing the Big 3 (Big 2½) with their large number of retirees against the transplants who have basically no retirees, which if strictly enforced, would mean not paying much more than minimum wage.
    • Note also that these are “targets”, and not “binding terms and conditions”, and so will be subject to some level of sanity.

In any case, meeting the terms has a deadline of March 30 of next year, which kicks everything to Obama.

I think that this is why Obama has said very little here, because if he were engaged, it would give Bush the cover to do something much worse.

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