Ford & Government Funding

[2010 SSRS]

Ford Frauds

[motorhead]

Originally Posted by The_Blur

To those of you who claimed GM was wrong to use government money, I present you Ford, a company who is currently using government money to pay back government loans.

These loans are coming from various agencies in federal and state governments. Just because Ford was able to get around last year's economic does not mean Ford did it without help. The government had already helped Ford out a year earlier with loans that kept the company functioning.

Can we stop bashing GM for doing the same thing as other automakers now?

Autoblog reported. Discuss.

Not the same thing Blur. Now your reaching. Anyway, I for one am glad the government did what they did for GM and Chrylser. It's about time they spend my money on something worthwhile.

[Georgie]

yeah same here. i think the auto bailouts weren't too horrible. what's horrible is the money the gave to research effects of marijuana on apes or some crap like that wth...

[1bad65]

Originally Posted by Dakota Kid

ViperTomcat nailed it.

Yes he did.

Sadly, there will be alot of Fanboys that either still somehow don't get it, as well as those who refuse to get it.

[1bad65]

Originally Posted by motorhead

Not the same thing Blur. Now your reaching. Anyway, I for one am glad the government did what they did for GM and Chrylser. It's about time they spend my money on something worthwhile.

I don't know about you, but when I spend my money I like to get something in return for my money. Even if the Government makes an amazing profit off the GM stock they own, you and I won't see a dime of it.

[The_Blur]

Originally Posted by a_Username

Well, last time I checked the phrase "Everyone else is doing it" doesn't really make the action any better. There are differences in Ford's and GM's financial crisis situations, considering only one company wasn't bought up by the Government(s). The only problem I have is with the media's "holier than thou" attitude towards Ford for them not receiving a direct bailout, and them neglecting the fact of Ford accepting government loans.

It doesn't make the bailout okay. I'm not excited about it either, but it does get people off their high horse on the subject.

Originally Posted by EnvyTerra

Bailout money/goverment buy out and loan money are two different things.
either way it's a shame, but GM took that shame to the next level.

sorry if that hurts anyones feelings, I don't like a coat of sugar on my sugar cubes.

The bailout was fundamentally a low-interest loan and a purchase of stock. GM could use that money to restructure. This is oversimplification, but it basically explains what happened. Governments all over the world routinely invest in large businesses in order to reap from profits or promote technologies that those companies are producing. This is a new move for the US government which goes to show how uneven the playing field has been until this happened.

Originally Posted by Number 3

Purely the words you are using, but if I loan you $10 to get you through the week and you do really really well on your own and don't need the $10 and you give it back to me...................didn't you repay the loan easily due to your sucess? Does that somehow minimize your personal success and hard work?

Also, and I believe it is in the publice record, you should see the list of stuff Ford was asking for DOE loans for. Things GM had already had in production for years as far as technologies for FE improvement.

GMs list actually seemed pretty advanced for the technologies and the programs that increased FE by the specified amount.

Don't get me wrong, Ford has done very well, but they had their look over the cliff when money was available. I have close friends at FoMoCo and they were whistling a far different tune in '06.

It wasn't that Ford was worth more than GM and could borrow against it, they actually just had less debt than GM. But they got financing when money was available. When the old GM made it's last gasps the country was WELL into spiraling gas prices and a tanked financial picture. Remember the top banking leaders went to congress for the handouts before GM did. So there simply wasn't money to borrow at any rate.

So simply using the threat of a bankruptcy, Ford negotiated everything GM and Chrysler were able to except for one key thing........a NO STRIKE CLAUSE and we'll see how that goes.

They strong armed everyone they owed money to reduce debt obligations.

And now they are using money loaned by the governemnt under the pretense of developing fuel saving technologies to pay down debt. How does that smell any different than what GM was beaten up for when they payed back their government loans?

This is exactly correct.

Originally Posted by motorhead

Not the same thing Blur. Now your reaching. Anyway, I for one am glad the government did what they did for GM and Chrylser. It's about time they spend my money on something worthwhile.

GM spent the money on restructuring. That's why GM is profitable now.

They spent their profit on products that they sell, repaying government debts early, and keeping the place open for business. Is that not worthwhile?

Before you jump at me saying that the government still has a majority stake in GM, I'll go ahead and point out that GM has a limited say on when the government will sell it's stake. That's up to the government.

Originally Posted by 1bad65

I don't know about you, but when I spend my money I like to get something in return for my money. Even if the Government makes an amazing profit off the GM stock they own, you and I won't see a dime of it.

Political science professors teach courses on where that money goes. It goes into the budget, and we see the money based on how our elected officials vote. If you want a say on where that money goes, you are welcome to contact your elected officials.

[bigearl]

Originally Posted by The_Blur

If you want a say on where that money goes, you are welcome to contact your elected officials.

I love how this whole back and forth gets rekicked off every few weeks- but this sentence quoted right here appears to be the one that I hope everyone takes away from this thread.

[305pride]

old news?

[syr74]

Originally Posted by The_Blur

It doesn't make the bailout okay. I'm not excited about it either, but it does get people off their high horse on the subject.

No it doesn't, you're trying to compare a loan to what was, despite the spin, a gift. Next time I'm at the bank looking for a loan I'm going to remember to tell them to just give me the money in exchange for something that I have which is, fundamentally, absolutely worthless because according to the U.S. government, GM, and GM's intrepid fans there is, effectively, no difference. Sadly, I'm guessing the bank isn't going to see it that way.

Originally Posted by The_Blur

The bailout was fundamentally a low-interest loan and a purchase of stock. GM could use that money to restructure. This is oversimplification, but it basically explains what happened. Governments all over the world routinely invest in large businesses in order to reap from profits or promote technologies that those companies are producing. This is a new move for the US government which goes to show how uneven the playing field has been until this happened.

It's a new move for the U.S. government which goes to show that, in yet another area, we have regressed and are no longer wiser than our international peers. Chew on this for a second, if a private banking firm
had taken investor money and done with it what the government did as it relates to GM people would be in prison right now.

Basically what happened is the government gave GM 60 billion give or take in exchange for stock that was...wait for it...absolutely worthless. The loan was a complete shame akin to a magicians trick intended to take the focus off of the fact that what the government was actually doing was ethically abhorrent. Again, what the government did was akin to saying "Hey, you need 60 billion, I'll give you 65 billion and you can just tuck away the extra five billion and give it back to me in two or three months. That way we can get all these suckers to focus on that bogus five million dollar loan you'll repay me ensuring a lot of them will miss the actual bailout which is ten times as large". Once again, if the private sector had done this with investor money people would be in prison right now. The fact that GM's bankruptcy was overseen by the same government that bought this worthless stock created a minor conflict of interest to be kind. Why? Because the government that purchased that worthless stock is the same government that allowed GM to legally walk away from debts, etc. which were a part of the reason that stock was worthless in the first place. Does anybody see a minor, ethical conflict going on here yet?

"Hey, I'll tell you what. I'll give you fifty billion for something that is worthless because you owe Joe's Widgets and various investors, etc over here sixty billion. Conveniently for both of us, I also have the legal authority to effectively declare your debts to Joe's Widgets and those investors null and void at any time as I so choose. What about Joe and the investors you say? Ah, screw 'em."

Yeah, that was a real victory for capitalism, seeing GM vendors and investors who did things the way they were supposed to get the shaft so the government could save a GM that looked like it had been run by narcissistic three year olds for about the last decade or so. Makes me proud of my government alright.

Sadly, even with this ridiculous scheme the reality is that the government is still absolutely certain to lose money on this deal. Why? Because GM isn't even close to being worth sixty billion despite what the pundits are saying. That tells us two things.

1: How unbelievably deep the crap GM was in actually was.

2: Our government really can't run anything correctly, not even what would be considered a money making, criminal scheme if a private firm had done the same thing.

But please, do continue to try and compare the above to a genuine loan, the laughter is good for me.

[1bad65]

Originally Posted by The_Blur

It doesn't make the bailout okay. I'm not excited about it either, but it does get people off their high horse on the subject.

Speaking facts is not getting up on a high horse. Since when is the truth a bad thing?

Originally Posted by The_Blur

The bailout was fundamentally a low-interest loan and a purchase of stock. GM could use that money to restructure.

But GM had so screwed up their corporation, no private lenders were willing to do it. Only the Government had the money (well they actually borrowed it from China) and the willingness to make the loans. Ford had enough deals made with private entities to survive without a bailout, even during the worst times for the Big 3.

Originally Posted by The_Blur

Political science professors teach courses on where that money goes. It goes into the budget, and we see the money based on how our elected officials vote. If you want a say on where that money goes, you are welcome to contact your elected officials.

My point was that the taxpayers won't see a dime of that money, even if the Government makes a profit. And that's 100% correct. If my money was invested in a struggling private company, and that company started making a profit, I would make some money. Why should this be any different?

[fielderLS3]

The Ford loans and the GM bailout are like comparing apples to oranges. The Ford loans where loans. (And for the record, I'm against that too. The government should not be giving loans to anyone, that is not the responsibility of the federal government, nor is it one of the powers granted to it by the Constitution).

However, the GM bailout went far beyond that. It was a handout. (I don't buy the it was a stock purchase argument as the amount given for the stock was much, much greater than the stock was worth). And it was not just a handout to the company. Let's not forget that bankruptcy laws where ignored, and creditors were illegally stiffed to ensure that the UAW got what their campaign contributions paid for, and ensure that the government got control of an industry.

Yes, Ford took government loans. I'm not defending it, and I'm not giving them a pass. However, Ford doing something bad should not be considered justification for GM (and Chrysler) does something worse.

Until every dime of the government money is paid back, I think every net tax payer should be eligible for employee discounts from all of these companies that are taking government money, as we are effectively working for them.

[The_Blur]

Clearly, some people can't take what they dish out. This thread is closed.