At the moment, the execs are late. That's what Congress gets for making them drive.
Sen. Robert Bennett: Hey, I've got a brilliant idea. Why don't we just have all the debt holders convert all their debt to equity. That would solve the problem of the large debt burdens these automakers have to service, right? And the equity holders would then be able to oversee the business strategy of the auto makers and force them to evolve.
And this pretty much sums up Congress' ignorance in these matters. Try to understand: No one wants to own stock in these liquidity black holes anymore, Senator. You really think that the banks want to end up holding the keys here and actively managing these money pits? Ugh.
What amazes me, truly makes me scratch my head, is how much discussion can go on about the importance of lending, warranty, jobs, taxes, oversight, and yet the key factor driving much of Detroit's ills is totally ignored. Their product simply sucks.
Senator Jon Tester: Can anyone give me assurances that if we hand over this $34 million that we won't have to be back here in a year, two years?
Ok, my time has expired.
(It's $34 billion, Senator).
Ok, Execs in the house.
Oh, if you want a preview of the new models, they are in the Dirksen parking lot.
Yes, I have the same stylist as the Donald.
Look, we axed the corporate jets, that's gotta be worth $12 billion, right? Seriously, we are in this situation because of forces beyond our control. Give us a break here.
Ron Gettelfinger (UAW):
Look, if you people don't throw some cash this way our way of life is over. I mean we can't have that. You people have got to force some sacrifices from everyone else. Yeah, it took us 30 years, but we are nearly competitive now (if you don't include the jobs bank, health care, pension benefits, early retirement and the like) so what the hell? And this bankruptcy thing is just not an option. I mean we are going to have to give up the farm if we end up in front of a judge!
Plus, you guys bailed out Citi. Where is our blank check? Eh? I mean we just want an emergency bridge loan that we will likely never pay back. What's the problem?
Alan Mulally (Ford):
Look, we dumped all those high-margin euro brands like Land Rover, Jaguar and the like. Now we are totally focuses on the low-margin, cookie cutter American designs. And that localization thing? Screw that. One product, one global market. We are focused. It's like Henry Ford used to say: You can have it in any color you want, as long as it's black. Back to the basics, we say. We don't expect a near-term liquidity crisis. We'll be profitable soon. You know.. soon... like... soon... 20...(ahem) 11... soon. You know. Look, we are America. You can't give those other guys money and not let us suck off the teat for a bit.
(The only guy to bother to point out that it might be a good idea to build cars that someone wants to buy).
We need you guys to fund our "product renaissance." (Wow, that's not bad... really....) and there are going to be 500,000 electric drive Chrysler vehicles on the road by 2012. (Assume we still exist). You handing us a bunch of cash is the least costly way for us to survive.
James Fleming (Automative Retailers Association):
Ok, look. We are small business people and entrepreneurs. So, since you have to pay us off to get rid of us, and our contracts make shutting us down totally cost prohibitive since we've squeezed you all for over a decade, thanks for inviting us. Since we'd all be sent to pasture in front of a bankruptcy judge, we really can't let that happen. Your function, the function of the automotive industry is to employ us. Period. We are going to sink all of Connecticut if you do that. Bank on it. Voters in your home states are doomed, baby. Look, all we need is some time to adjust. Yeah, we've have 10 years to do it, but now we're really serious. Seriously serious.
Mark Zandi (Moody's)
These are my personal remarks, I wouldn't want to damage the sterling reputation of my employer.
$34 billion is bullshit. Think $75-$125 billion. And this $34 billion? In phases, with milestones.
Uh, Senator Schumer? I know you want to stick it to the bond holders, since "the workers" have already given so much (though I haven't seen anyone propose killing the jobs bank) but why in the world do you think they would give even the slightest bit more than they expect to have to in bankruptcy?
How long does GM have before bankruptcy?
Ron Gettelfinger: The end of this month.
Wow. What happened to GM being liquid enough to manage through 2010? I guess that was 2,010 hours and we all misread it?
Finally, after hours and hours of nonsense, Senator Bob Corker pulls no punches:
Ford is only here on the coattails of GM, since they aren't really in deep trouble. Chrysler is only here because Cerberus, who really only bought Chrysler to get hold of GMAC (which has turned into custard) and now refuses to throw any more money at the problem and is just hoping to get enough time to sell itself off to someone, having invested zero in new products or technology and with no future to speak of. Nardelli's weak protests aside, Corker has them by the short hairs. Three companies are simply not going to survive. So, who is going to take the bullet? (Chrysler, we are looking at you).
I want to move to Tennessee just to vote for this guy.
Corker continues: Hey, GM, at the debt levels you are at, you cannot survive. Not with 11 million units, not with 20 million. As for bondholders taking a haircut, your debt is trading at below thirty cents. So, with all the whining the UAW has done, those bondholders are not giving any more until the UAW gets serious. So, UAW, what are you going to give? And don't give me this bullshit I've already heard. Tell me about the $21 billion in voluntary payments to the voluntary employees' beneficiary association because those are eliminated in Chapter 11. How much of that are you willing to dump? They need half of it gone. If you aren't willing to do that then we have no reason to continue talking.
Is this guy single?
Protesters! Finally this is getting some juice. Chant it with me: "A bailout is a sellout! A bailout is a sellout! A bailout is a sellout!"