The Treasury Department announced Wednesday the U.S. government would take a majority ownership stake in the troubled auto financier GMAC.
Treasury will provide $3.8 billion to the auto lender, which has struggled to raise private funds.
Treasury's equity ownership of GMAC will increase from 35 percent to 56 percent under the transaction, making the government and taxpayer the majority owner.
Treasury previously had invested $12.5 billion in preferred stock in GMAC. It owns a total of $13.1 billion in preferred stock in GMAC, which includes purchases, the exercise of warrants and 35 percent of common equity.
The U.S. government's unprecedented intervention in the auto sector earlier led to the dismissal of General Motors CEO Rick Wagoner, who was ousted by the Obama administration.
Treasury said it had initially thought it would have to provide $5.6 billion to GMAC, and cast the $3.8 billion in support as a reduction in its expected expenditures under the Troubled Asset Relief Program. It said less money would be needed because the restructurings of General Motors and Chrysler had been less disruptive than expected.
While other large banks such as Wells Fargo and Citigroup have recently paid back billions in government funds, GMAC has sunk deeper into need. GMAC is also a centerpiece of the American auto industry the Obama administration has attempted to rejuvenate.
GMAC is the primary lender to General Motors and Chrysler customers.
GMAC will become the sixth company the U.S. has taken control of in the past two years.
It joins mortgage lenders Fannie Mae and Freddie Mac, auto manufacturers General Motors and Chrysler and the largest commercial insurer in the U.S., American International Group.
Posted by: Fred ||
12/31/2009 00:00 ||
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Remainds me of my childhood (I lived in Soviet U. until 13).
#3
Treasury will provide $3.8 billion to the auto lender, which has struggled to raise private funds.
Hmm. You don't think that large, institutional investors might be a tad skittish about Government Motors after having seen other large, institutional investors get hosed in the bankruptcy proceedings might have something to do with that?
#4
large, institutional investors might be a tad skittish
They might be, but the investment managers will buy anyway, once they receive the 'right' personal compensation. Now the small, individual investors...we aren't buying. And we aren't putting as much in the hands of the large institutions either.
#6
Two strikes, one more and they're OUT.
I see hordes of potential buyers refusing GMAC financing, go with your home bank, not Government Motors. (Anybody else remember Al Capps "General Bullmoose Motors"?
"What's good for General Bullmoose, is good for the USA")
Posted by: Redneck Jim ||
12/31/2009 14:32 Comments ||
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As a fresh poll measured the political cost of Sen. Ben Nelson's health reform vote, he prepared Tuesday to take his case directly to Nebraskans during Wednesday night's Holiday Bowl game.
Nelson will air a new TV ad in which he attempts to debunk opposition claims that the Senate legislation represents a government takeover, and he makes the case for health care reform.
"With all the distortions about health care reform, I want you to hear directly from me," the Democratic senator says in the ad.
Nelson, dressed in an open-necked shirt and sweater, speaks directly into the camera during the 30-second ad.
The message will be launched during the Nebraska-Arizona football game and continue to air statewide for an undisclosed number of days.
The political damage Nelson may have incurred in providing the critical 60th vote that cleared the way for Senate passage of the health care reform bill showed up Tuesday in a poll released by Rasmussen Reports.
The telephone survey of 500 Nebraskans, conducted Monday, suggested Republican Gov. Dave Heineman would defeat Nelson in a potential 2012 Senate race by a 61-30 margin.
The poll showed Nelson with a 55 percent unfavorable rating and 64 percent disapproval for Democratic health care reform legislation.
"The good news for (Nelson) is that he doesn't have to face Nebraska voters until 2012," Rasmussen Reports stated in posting results of the survey on its Web site.
Nelson would be seeking a third term should he choose to be a candidate for re-election three years from now.
Heineman is seeking re-election as governor in 2010 and would be at mid-term if he chooses to enter the Senate race in 2012.
Julie Schmit-Albin, executive director of Nebraska Right to Life, said the Rasmussen results demonstrate that Nelson's votes on health care are "clearly out of touch with the majority" of Nebraskans.
Earlier, Schmit-Albin said Nelson betrayed his pro-life supporters when he agreed to compromise language prohibiting federal funding of abortions.
Posted by: Fred ||
12/31/2009 00:00 ||
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The telephone survey of 500 Nebraskans, conducted Monday, suggested Republican Gov. Dave Heineman would defeat Nelson in a potential 2012 Senate race by a 61-30 margin.
Not something a pricey TV add and a cardigan are likely to fix. You can stick a fork in it Ben, you're DONE!
....No tie? How very Obamisch, I'm on holiday you know.
#6
Rantburg should have a graphic of toast popping up out of a toaster...or maybe some toast on a plate with butter on it.
Posted by: Abu Uluque ||
12/31/2009 11:45 Comments ||
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Dave Heineman would defeat Nelson in a potential 2012 Senate race by a 61-30 margin.
These donks certainly seem to be on a suicide mission. Let's hope the voters don't forget by election time. Not likely since the economy is in the dumper and assured to go further in the dumper with the really dumb economic policies that are being pursued. There are few jobs aside from government jobs. These jobs don't create any wealth--only suck money from any taxpayers who are left. We've managed to give away to our economy to foreign countries such as India, China, and third-world countries. More taxation will only make things worse. Out-of-control spending money we don't have will make the economy worse. No, I don't think the voters will forget. So the burnt toast pic is appropriate for Nelson.
For all their railing against the evils of big bad banks, Democrats aren't shy about jumping into bed with them when the price is right. And they don't much care whether taxpayers lose out in the process. Rep. Barney Frank, Massachusetts Democrat, and his cohort Rep. Maxine Waters, California Democrat, are leaders in making support for delinquent banks into a respectable progressive cause.
OneUnited Bank, based in Mr. Frank's home state, landed more than $12 million in Troubled Asset Relief Program money last winter thanks to the congressman's insertion of language into the bill that gives the bank special consideration. Mrs. Waters, whose congressional campaigns benefited from OneUnited executives' donations of more than $12,000, also helped the bank by arranging a meeting between bank executives and government officials shortly before the bailout bill's passage.
Congressional financial-disclosure forms showed Mrs. Waters had up to $500,000 worth of stock in the company until 2004 and that her husband, Sidney Williams, was an investor who profited to the tune of $250,000 from a related bank merger. Mr. Williams also served on the bank's board until early 2008.
But the sweetheart deals aren't the worst of the bank-bailout story. Now OneUnited, which, as a decidedly unhealthy bank never even met the criteria for bailout funds in the first place, is failing to pay interest on its government handout - and it probably never will.
In November, the bank missed its third dividend payment in a row. Not counting the most recent sum it failed to fork over, the bank now owes the U.S. government more than $300,000. But because OneUnited has no holding company, it is not bound to pay dividends at all, which means it is essentially getting an interest-free loan, courtesy of Mr. Frank and Mrs. Waters.
Central Pacific Financial of Hawaii, which also has missed multiple dividend payments, was the only bank besides OneUnited to get funds from the bill following questionable congressional intervention. In July, it reported a loss of $146 million - due in large part to investments in the collapsing California housing market - and before receiving federal aid had been told by its primary regulator it did not meet standards for receiving help. A federal funds injection looked far from likely for Central Pacific - until Sen. Daniel K. Inouye, Hawaii Democrat and one of the bank's founders, made a call to federal regulators. Two weeks later, the bank announced Treasury would give it $135 million.
The moral of the story is simple: When Democrats rail about the evils of unregulated business and the need for federal controls, remember that this is what they have in mind.
Posted by: Fred ||
12/31/2009 00:00 ||
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USA been converting Latin America to Democracy for 100 years (at least). Look who's got converted!
Progressives are taking aim at some of their closest allies in the Senate, pressuring liberals to demand a public option in healthcare reform. The Progressive Change Campaign Committee (PCCC) is launching a series of robocalls and ads in Vermont and Wisconsin asking Sens. Bernie Sanders (I-Vt.) and Russ Feingold (D-Wis.) to vote against any bill that does not contain a government-administered insurance plan.
The pressure is part of the group's "Be a Hero" campaign. The PCCC hopes that by demanding public option, a single liberal senator can exert the same influence on the legislation that centrists have. The group will also deliver petitions to Sens. Al Franken (D-Minn.) and Sherrod Brown (D-Ohio).
All four of the targeted senators voted both for cloture and the Senate bill itself. PCCC is hoping that at least one of them will hold out for some kind of public plan during negotiations with the House.
Sanders, Feingold and other Senate progressives have strongly supported a public option, but their desire to see some legislation passed has so far stopped them from issuing an ultimatum on the issue.
"Bernie Sanders can be a hero at this historic moment by declaring that any final bill must have a public option to win his support," said PCCC co-foudner Adam Green. "That would change the entire calculus in House-Senate negotiations and force President Obama to finally fight back against Joe Lieberman's threats."
Posted by: Fred ||
12/31/2009 00:00 ||
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Attorneys General from 13 states penned the top two Democrats in Congress Wednesday requesting they remove extra Medicaid funds directed toward Nebraska.
The attorneys general, all Republican, say that Senate Majority Leader Harry Reid (D-Nev.) tacked on extra Medicare funds to the Senate bill to buy the vote of holdout centrist Sen. Ben Nelson (D-Neb.)
The state officials, led by South Carolina Attorney General, Henry McMaster, say that the provision is unconstitutional and ask that Reid and House Speaker Nancy Pelosi (D-Calif.) remove it as to avoid a lawsuit.
"We ask that Congress delete the Nebraska provision from the pending legislation, as we prefer to avoid litigation," they wrote. "Because this provision has serious implications for the country and the future of our nation's legislative process, we urge you to take appropriate steps to protect the Constitution and the rights of the citizens of our nation."
Critics, who have dubbed the funds as the "Cornhusker Kickback" say that the $100 million deal is emblematic of Washington wheeling and dealing and that it is not fair to other states who have to use their own funds to pay for the Medicaid expansion included in the healthcare overhaul.
The letter comes just weeks before the Senate and House will meet to merge their two healthcare reform bills.
Nelson defended the deal on the Senate floor several weeks ago, saying that other states could have access to such federal funds. Critics disagree, claiming that Nelson received it exclusively in exchange for his vote.
The 13 GOP attorneys general argue that the provision runs up against Supreme Court decisions banning the "display of arbitrary power" and violates other Constitutional protections.
"The fundamental unfairness of H.R. 3590 may also give rise to claims under the due process, equal protection, privileges and immunities clauses and other provisions of the Constitution," they wrote.
Posted by: Fred ||
12/31/2009 00:00 ||
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The other 36 states, where are their AG's? Oh, only Republican AG's are speaking out. I get it.
Former Rep. Jim Traficant (D-Ohio) will run for Congress in 2010, according to a media report Wednesday. "I'm going to run," Traficant said before about 35 members of The Biz Society, the Youngstown Business Journal reported Wednesday.
The former lawmaker's words come almost four months after he was released from federal prison after he served part of a seven-year sentence on a racketeering conviction. Traficant was removed from Congress in 2002.
Traficant, who used to represent Ohio's 17th district, said he has not yet made up his mind on which district to run in.
The 17th district is now represented by his former staffer, Rep. Tim Ryan (D-Ohio). The Journal reports that Traficant has nominating petitions circulating in the 17th, 16th and 6th congressional districts.
The 16th and 6th districts are represented by Democratic Reps. John Boccieri and Charlie Wilson, respectively. "I'm going to run for Congress somewhere," Traficant said. It is unclear if he will run as a Democrat, Republican, independent or under a third party.
During his time in Congress, Traficant was known as a colorful character known for his offbeat attire and his penchant to quote from "Star Trek," frequently saying "beam me up" at the conclusion of his floor speeches.
At the speaking engagement, Traficant vowed revenge on the individuals who provided information about him to federal investigators. "I want to get these suckers!" he said. "You are being addressed by a very bitter guy."
Posted by: Fred ||
12/31/2009 00:00 ||
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God, I hope the state GOP's barred the doors against that felon. Bad enough we have Andy Martin running around without a leash in Illinois, getting rabies-infected foam all over the place.
Posted by: Mitch H. ||
12/31/2009 13:21 Comments ||
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There was a lot of love in the room for U.S. Sen. Christopher J. Dodd Tuesday as he addressed the New Haven Democratic Town Committee, which will bring the largest number of delegates to the party's nominating convention this spring.
Dodd, fresh from the Senate's passage of a major health care package on Christmas Eve morning, was the only speaker at the committee's holiday party at the Shubert Theater. The event also brought together most of the gubernatorial contenders and other statewide office-seekers.
That health care bill will be a big part of his campaign for re-election to a sixth term. Many think it will be his toughest battle yet, with his poll numbers down and several well-funded Republican challengers waiting.
"It ought to be true that every child in America, regardless of their circumstances, has a right to a doctor when he gets sick, and that's what we are about to do in this country. It will be the single most important vote that will have occurred since Social Security and the adoption of Medicare," Dodd said.
The bill is now headed for a conference committee of House and Senate leaders for some tough negotiations on sticking points, such as abortion coverage. That work will start today.
The first thing Dodd said he did after the Senate vote last week was to visit the gravesite of his good friend, the late U.S. Sen. Edward M. Kennedy, D-Mass., who made health care reform a central part of his agenda for four decades in the Senate.
Dodd said he got a call from President Barack Obama while he was at Arlington National Cemetery to thank him for his efforts on the legislation.
"Tell the old guy I was asking for him," Dodd said the president remarked to him about Kennedy.
The largest plurality of votes for Obama in the state came from New Haven in 2008, and the city will play a big part in determining the party's slate in this year.
Posted by: Fred ||
12/31/2009 00:00 ||
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"Tell the old guy I was asking for him," Dodd said the president remarked to him about Kennedy.
Look for Ted Kennedy the next election; it's too early now.
This administration is beginning to get far beyond just being frightening
On December 26, two days after Nigerian Omar Abdulmutallab allegedly attempted to use underwear packed with plastic explosives to blow up the Amsterdam-to-Detroit flight he was on, and as it became clear internally that the Administration had suffered perhaps its most embarrassing failure in the area of national security, senior Obama White House aides, including chief of staff Rahm Emanuel, David Axelrod and new White House counsel Robert Bauer, ordered staff to begin researching similar breakdowns -- if any -- from the Bush Administration.
"The idea was that we'd show that the Bush Administration had had far worse missteps than we ever could," says a staffer in the counsel's office. "We were told that classified material involving anything related to al Qaeda operating in Yemen or Nigeria was fair game and that we'd declassify it if necessary."
The White House, according to the source, is in full defensive spin mode. Other administration sources also say a flurry of memos were generated on December 26th, 27th, and 28th, which developed talking points about how Obama's decision to effectively shut down the Homeland Security Council (it was merged earlier this year into the National Security Council, run by National Security Adviser James Jones) had nothing to do with what Obama called a "catastrophic" failure on Christmas Day.
"This White House doesn't view the Northwest [Airlines] failure as one of national security, it's a political issue," says the White House source. "That's why Axelrod and Emanuel are driving the issue."
Axelrod, who has no foreign policy or national security experience beyond occasionally consulting with liberal or progressive candidates running for political office in foreign countries, has been actively participating in national security briefings from the beginning of the administration. He has also sat in on Obama's "war council" meetings, providing Obama with suggestions in both venues based on what he knows about polling and public opinion data, say several White House sources.
"[Axelrod] isn't sitting in the meetings telling the President, 'Do this because the polling shows that,'" says one source. "But we know that in less public settings, or on paper, David does provide guidance to the President that gives him added context to the recommendations and information our foreign policy and national security teams give him."
Axelrod's presence in the meetings has raised some eyebrows, as previous political advisers in the White House have typically not participated in such meetings. Bush Administration sources, for example, say that political adviser Karl Rove was not present at national security meetings.
#1
Dr. Goebbels advocated that propoganda was an integral part of national security.
Axelrod and Emanuel are indicating to me that to Obambi, every decision is a political decision. THis is exactly what I feared from him. The Dems played politics with National Security when Bush was President and now they are playing politics with national security under Obama.
They are playing with fire, all it will take is one successful terrorist act in the US under these guys watch, with the American public knowing how the Dems treated Bush's efforts to keep us safe, and all hell is going to break loose.
I do have one suggestion to AQ, whatever you do, I suggest ground zero should be the NYT...that'll MAYBE wake up the press to the reality of WAR...they can deny and ridicule Dick Chaney all they want but a majority of American's agree with him and their denial/ridicule only enflames the citizens of this country about the lack of seriousness by this administration about National Security
Posted by: Karl Rove ||
12/31/2009 12:28 Comments ||
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Missing from the analysis is recognition of the fact that Axelrod and Emanuel each have more brains, and bigger stones, than The One. Fortunately, both of these guys are small-time Chicago hatchet men. Just imagine if they were capable of conceiving and executing a grand strategy.
IOW, it's less "Manchurian Candidate" than "Being There."
A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
As a fresh poll measured the political cost of Sen. Ben Nelson's health reform vote, he prepared Tuesday to take his case directly to Nebraskans during Wednesday night's Holiday Bowl game.
Former Rep. Jim Traficant (D-Ohio) will run for Congress in 2010, according to a media report Wednesday. "I'm going to run," Traficant said before about 35 members of The Biz Society, the Youngstown Business Journal reported Wednesday. 
There was a lot of love in the room for U.S. Sen. Christopher J. Dodd Tuesday as he addressed the New Haven Democratic Town Committee, which will bring the largest number of delegates to the party's nominating convention this spring.
