Hoblit wrote:That would be an obviously unsound investment that the banks wouldn't be interested in. (Right? Wouldn't that be one of the reasons congress didn't loan?)
It was just one option off the top of my head. If I give my daughter $100 and tell her to get her brother an ice cream with some of that money - I expect her to do it. The banking industry being directed to to direct $14B of their shiny new $350B to the auto industry didn't seem like too much of a stretch to me.
But the main reason the loan didn't get thru congress is that Bush blinked too early.
The Senate was very close to getting the votes needed to pass their $14B bridge loan - until Bush tipped his hand by saying that if the bill failed, he would look to use some TARP money to help the flailing industry. As soon as he did that, the chickenshit southern republicans could then run for cover claiming "fiscal responsibility," knowing that they wouldn't be blamed for the collapse of the Big Three because Bushie had 'em covered.
This is a bridge "loan," not a huge investment, and an unusually wise move by the outgoing president to put a band-aid on the situation and let Obama take over the real headache next March. This economy cannot afford to lose another 3M jobs right now.
With a new administration and congress in place, and a little time, hopefully they can craft a more palatable plan by then.