GM and Chrysler are Looking for Another $10B (after getting $25B in September)

How do your explain giving $35B to a group of companies that have ignored market indications for decades and continued to invest in failed product lines? With Congress talking about sending another $10B to these two merger candidates, we should soon have an answer. Mergers are notorious for sapping the energy, brainpower and other resources from the combined entity for years afterwards. If GM and Chrysler are already failing then what will happen when they merge? How about more layoffs; more lost of market share; and more requests for billion dollar bail outs.

While we were watching the BailOut, a $634B bill was just signed by President Bush with a $25B bail out going to the Chrysler, Ford and GM, and no one said a thing. They initially asked for $6B in January but with Congress handing out $700B, they decided to up the ante. The auto makers intend to ask for another $25B next year to follow the decline of their revenues. This is American ingenuity at its best! The managers cannot figure out how to put out a product that can compete in the marketplace but they know enough about finance to land a multi-billion dollar bail out when they suffer losses. What really needs changing is the hiring practices of all major companies in America. Instead of just looking for JDs from Yale or MBAs from Harvard, they need to develop, and then give all applicants a common sense test.


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