government news | Politics and Policy
Government bailout of GM,
auto industry seems certain
he incoming U.S. administration money by mid-2009 unless it got emer-
will not let the country’s auto in- gency federal assistance. nesses dependent on the industry.
dustry go down, and the outgoing It also said it had suspended merger President-elect Barack Obama signaled
administration has already lent the indus- talks with Chrysler to focus on its own his intentions to help the auto industry,
try $25 billion for investment purposes. increasingly urgent problems, brought on calling it “the backbone of American
This assures that despite rising costs, a by higher gas prices, a weakening econ- manufacturing” during his ﬁrst news
dearth of new ideas, and poor manage- omy and tight credit—a combination af- conference after his election.
ment the big three will somehow carry ﬂicting the entire auto industry, but hurt- “I have made it a high priority for my
on. It is the concept of “too big to fail” ing GM the most. transition team to work on additional
spreading its wings. The government faces a difﬁcult policy options to help the auto industry
The New York Times reported the rap- choice. If it provides GM with a bailout, adjust, weather the ﬁnancial crisis and
idly deteriorating ﬁnances of General Mo- there is no guarantee the company will succeed in producing fuel-efﬁcient cars
tors are forcing the federal government not need more money later to stay out of here in the United States of America,”
to decide whether to bail out the largest bankruptcy, particularly with the econo- Obama said.
American automaker or face the prospect my weakening. However, a bankruptcy by Congress has already provided $25 bil-
that it might go bankrupt. GM or any other automaker would have lion in low-interest loans to help car com-
GM said that its cash cushion had far-reaching consequences, given the panies build more fuel-efﬁcient vehicles.
been dwindling by more than $2 billion a millions of people employed by supplier The Bush administration has balked at
month recently, and it could run short of companies, dealers, and other small busi- providing any additional ﬁnancing.
European Commission sees Energy, environmental, and
initiative on REACH as good sign security policies are one
REACH substance declaration requirements are placing increas-
ing pressure on the electronics supply chain to disclose informa- Two U.S. lawmakers asked Congress to address all U.S. energy
tion on hazardous substances. production aspects declaring, “We no longer can ignore the fact
REACH (Registration, Evaluation,