CHESSNOID

Just like the Wall Street bailout, this auto bailout will eventually be passed. If not, then Congress and Paulson will try to use money from TARP.  I don’t support the bailout in any form.  The stock markets were up and down with this news, but in the end the market closed up.

I think many in Congress namely the Democratic Harry Reid thought the market would tank if they didn’t pass it.  For a moment the market reacted but quickly bounced back.  Fundamentally, I don’t think the bailout is the solution.  The problem is the automakers can’t sell their cars.  Giving them any amount of money to keep the company running for payroll reasons will not help them sell that inventory.

I know many people will be laid off when these companies eventually file bankruptcy. I don’t want these companies to fail but it is definitely wrong to use taxpayers’ money against the taxpayers’ wishes to bailout out private for profit companies.

The previous bailouts have been failures and have not changed the fundamentals of the companies and the money is not being used as it was intended.  I believe Congress betrayed the American people by using taxpayer money to bailout these private organizations.  In a recent audit, CBS reports:

(AP) The government must toughen its monitoring of the $700 billion financial bailout to ensure that banking institutions limit their top executives’ pay and comply with other restrictions, federal auditors said Tuesday in the first comprehensive review of the rescue package.

The Treasury Department has no mechanism in place to track how institutions are using $150 billion in taxpayer money that the government injected into the banking system as of last month, the Government Accountability Office concluded in its report to Congress.

The auditors acknowledged that the program, created Oct. 3 to help stabilize a rapidly faltering banking system, was less than 60 days old and has been adjusting to an evolving mission.

But the 72-page report was bound to feed congressional concern that banks and other institutions are not being properly monitored and are not using the money to increase lending.

It was obvious the way Paulson wanted the bailout cash with no oversight demonstrates it was just a welfare program for Wall Street. He didn’t fool everyone with his silly threats that the sky was falling and would continue to do so if we didn’t give him what we wanted. He has been granted those funds and the economy only continues to get worst.

Paulson originally wanted to use this money to buy worthless loans, then never spend a penny towards that goal.  Now we find out where the money went; CNN.Money:

Treasury doled out the government money with the intention that banks use it to lend, but some have instead used bailout funds to finance purchases of other institutions. The program is meant to ensure the bailout funds do not go to finance paychecks of top executives, and banks are required to pay out a dividend.

But the report said Treasury currently lacks sufficient oversight methods to ensure banks comply.

“It’s not at all surprising, that Treasury’s still behind the 8-ball,” said Bob Brusca, economist with FAO Economics. “How would you know if TARP funds go to pay for loan servicing or went to pay a CEO salary? Money doesn’t have footprints.”

The government bailouts don’t work and are not solutions to the dying companies ready to go bankrupt. Tax money should not be used at all.