Something is Just Really Screwy When the Full Faith and Credit of the U.S. Gov't is Backing Transmissions

Nick Gillespie | March 31, 2009

We've all lived through way too many NPSMs (go here for NSFW explanation [especially if you work for the government]), but what the hell sort of language and outrage can match the lastest economic brain fart from the Obama crew? From government-backed T bills to government-backed Model Ts? My grandparents emigrated to America from wretched Europe for this?

The U.S. government Monday revealed the details of a highly unusual plan it hopes will ease consumer concerns about purchasing new vehicles from struggling domestic auto makers.

The plan calls for the creation of cash accounts that would equal 125% of the projected costs of paying claims related to warranties on each new vehicle sold by General Motors (GM) and Chrysler while they are in the midst of a government-led restructuring.

Auto information provider Edmunds.com estimates the reserve funds for the guarantee program would need a total of at least $1.9 billion—$1.2 billion for GM and $675 million for Chrysler. The estimates are based on GM selling 1.6 million vehicles in 2009 and Chrysler selling 900,000.

The U.S. Treasury will contribute 110% of the cash required for the accounts while the auto makers contribute the remaining 15%. Special purpose companies holding the funds would be run separately from the auto makers, allowing them " to continue paying warranty claims even if the auto manufacturer goes into bankruptcy or goes out of business."

What did you do during the government-extended business cycle downturn of 2008-????, daddy? Son, I changed timing belts under warranty for what used to be called GM.

And you thought the dealerships were ripping you off before. Just wait till the Medicare for Automobiles Act swings into high (and stripped) gear.

More here.

Comments

Suki|3.31.09 @ 8:03AM|#

Glad I do not need a new car right now. Glad the ones I have are not GM either.

Will getting your transmission fixed be like getting a new driver's license, or more like getting a business license?

|3.31.09 @ 8:04AM|#

Who in the world would buy a car, knowing that they have to deal with the government to get warranty service?

-jcr

Kyle Jordan|3.31.09 @ 8:06AM|#

On the bright side, this means that if I decide to go with a Cadillac CTS, I'll have warranty coverage. Of course the entire situation makes me want to vomit with rage but hey, it's time to find some silver linings.

Then again, this makes the Acura RL look even better to me.

SxCx|3.31.09 @ 8:09AM|#

Wake me when it's over.

Vines & Cattle|3.31.09 @ 8:10AM|#

It's official, I can't be surprised any more.

GM could start cranking out Trabants next week, and I'd just ask what colors they come in.

|3.31.09 @ 8:13AM|#

V&C,

You can have any color you want; as long as it's black.

Vines & Cattle|3.31.09 @ 8:18AM|#

Cool.

See? Nothing. I for one welcome our new Bolshevik overlords.

ed|3.31.09 @ 8:20AM|#

The U.S. Treasury will contribute 110% of the cash required for the accounts while the auto makers contribute the remaining 15%.

Does not compute. Getting dizzy.

Taktix®|3.31.09 @ 8:22AM|#

Wake me Sober me up when it's over.

Fixed to fit me...

Cabeza De Vaca|3.31.09 @ 8:28AM|#

Taxtix,

I'll have the Narcan ready. Although, it may be a few dozen years from now before this is over.

Xeones|3.31.09 @ 8:32AM|#

Ah, fuck.

semm|3.31.09 @ 8:36AM|#

I literally screamed 'What the f is going on?!' in the caa this morning when I heard Pres Obama lay this out on the radio.

Taktix®|3.31.09 @ 8:39AM|#

The unions finally did it. This is the revolution, folks...

Sally O\'Boyle|3.31.09 @ 8:46AM|#

Buy Toyota.

Xeones|3.31.09 @ 8:51AM|#

I have never owned an American car. Now i'm damn sure i never will.

Suki|3.31.09 @ 8:54AM|#

The unions finally did it. This is the revolution, folks...

My friends lied to me again? They said it would not be televised.

Xeones|3.31.09 @ 9:01AM|#

Taktix®, i'm not so sure you can call it a revolution when it's really just the logical progression of government growth and, uh, outreach.

The revolution will be when it comes time to put a stop to all of that. Patriots, tyrants, a certain red fluid, etc.

|3.31.09 @ 9:01AM|#

You can have any color you want; as long as it's black.

Hey now, be fair. They've announced a lite black for the 2013 season.

Xeones|3.31.09 @ 9:02AM|#

They've announced a lite black for the 2013 season.

Also, you can fuel it with your choice of biodiesels, corn-based OR soy-based!

T|3.31.09 @ 9:15AM|#

While this entire episode makes me want to vomit, at least I can buy the 2010 Camaro I've been wanting and not worry about warranty coverage. There's my personal silver lining in the cloud of doom descending on America.

Brian|3.31.09 @ 9:18AM|#

I'm more than a little worried that a guy who has never run any profitable enterprise now thinks that he can run ALL of them. Every time he talks about his plans, he sounds like a first year MBA student mashing together some of the words he saw while flipping through his new textbooks.

We. Are. So. Fucked.

|3.31.09 @ 9:18AM|#

Also, you can fuel it with your choice of biodiesels, corn-based OR soy-based!

Or you can scotch the removable floorboards and peddle it around like Fred Flintstone.

Reinmoose|3.31.09 @ 9:25AM|#

Hey now, be fair. They've announced a lite black for the 2013 season.

That's actually still up in the air. They haven't finalized negotiations with the unions yet --- no, not the UAW, the US Auto Company Patriotic Fair Paint Mixers Labor Union

|3.31.09 @ 9:25AM|#

Yours came with floorboards?!? I guess some people really are more equal than others, eh comrade?

|3.31.09 @ 9:28AM|#

That's actually still up in the air.

Damn you and your lies, Trabantipedia! I'll never trust that site again.

Can you at least still get it in the original rust and pop-rivet unpaint job?

|3.31.09 @ 9:29AM|#

You can have any color you want; as long as it's black.

Which is banned in CA for environmental reasons....

|3.31.09 @ 9:30AM|#

Latest abc news/washington post poll shows:
1000 people polled said they.

80%blame banks and corporations for economic mess.
70% also blame Bush deregulation and consumer stupidity.
60% approve Obama's work on the economy.
64% think Obama will fix the economy.
26% say Obama not doing enough.


Not only are you screwed, but it is with voter approval.

creech|3.31.09 @ 9:30AM|#

Is it time to tar and feather Mr. Greenspan for lifting the lid on Pandora's box and setting back the free market's hard won acceptance for two or three generations?

|3.31.09 @ 9:31AM|#

The plan calls for the creation of cash accounts that would equal 125% of the projected costs of paying claims related to warranties on each new vehicle sold by General Motors (GM) and Chrysler while they are in the midst of a government-led restructuring.

What the fuck?

Kyle Jordan|3.31.09 @ 9:33AM|#

"80%blame banks and corporations for economic mess.
70% also blame Bush deregulation and consumer stupidity.
60% approve Obama's work on the economy.
64% think Obama will fix the economy.
26% say Obama not doing enough."

This makes me want to hang myself. God damn...

Is it still against the law to randomly punch people in the throat?

Reinmoose|3.31.09 @ 9:34AM|#

The NY Times account of the press conference for this (linked for some reason in the morning links thread) is ridiculous. Since the government has its fingers in GM and Chrysler they're pimping those companies and completely ignoring Ford. It's one thing to be like "you should buy and american car" and quite another to be like "we are going to explicitly try to get you to buy one of the cars that we have a stake in."

Robert Gibbs speaks for all of America - "I used to have a Jeep"

|3.31.09 @ 9:40AM|#

The U.S. Treasury will contribute 110% of the cash required for the accounts while the auto makers contribute the remaining 15%

Time out....

-------

at least I can buy the 2010 Camaro I've been wanting and not worry about warranty coverage.

Something tells me you're going to *need* that warranty, when the UAW becomes a government contractor.

|3.31.09 @ 9:41AM|#

Is it still against the law to randomly punch people in the throat?

That depends; are you a civilian?

Reinmoose|3.31.09 @ 9:43AM|#

correction - it was the washington post article

spambot|3.31.09 @ 9:46AM|#

"are you a civilian?"

Service means citizenship, AND a car warranty!!

Would you like to know more?

|3.31.09 @ 9:53AM|#

So the Administration hasn't noticed that every time they make an announcement about their plans the stock market plummets? Seriously, they really need to STFU and stop doing things.

Personally, I look forward to the revolution. (Red liquid all over the floor variety, of course.)

This is ouuuurrrrr couuunnnntryyyyyyyyy!!!

Kyle Jordan|3.31.09 @ 9:53AM|#

"That depends; are you a civilian?"

Well, I do have some black BDU pants and a couple 5.11 tactical long sleeve shirts...

But my IQ is above 80 so it'd be a dead giveaway.

Xeones|3.31.09 @ 9:54AM|#

80%blame banks and corporations for economic mess.
70% also blame Bush deregulation and consumer stupidity.
60% approve Obama's work on the economy.
64% think Obama will fix the economy.
26% say Obama not doing enough.

By my calculations, then, uh... fuck 300% of the American people, yo.

Wait.

Obama Moose|3.31.09 @ 9:56AM|#

This is the second notice that the factory warranty on your vehicle is about to expire or has expired...

|3.31.09 @ 9:57AM|#

This is the second notice that the factory warranty on your vehicle is about to expire or has expired...

You get that, too?

|3.31.09 @ 10:04AM|#

I've had about a hundred second notices already.

Suki|3.31.09 @ 10:05AM|#

Are these warranties better or worse than those bonuses? When you guys get your GM cars fixed, who pays the tax on the labor, you or the dealer?

|3.31.09 @ 10:06AM|#

GM dog-and-pony show now in progress.

"abnormally low sales levels"

price supports for cars!

Our government subsidized program is better than Ford's puny capitalist one!

hmm|3.31.09 @ 10:10AM|#

I can fix my own truck. Thanks for the offer, but no thanks. I'd rather not have the government fixing anything I ride in at 70 miles per hour.


Then again I don't have to fix it, it's a Ford and so far they have somehow managed to weather this shit storm.

|3.31.09 @ 10:10AM|#

AIG will run the warranty program! WIN-WIN, boobs!


Fritz sez: thanx for putting me in the driver's seat!

T|3.31.09 @ 10:13AM|#

Something tells me you're going to *need* that warranty, when the UAW becomes a government contractor.

Can't the president fire all union workers in that case? I mean, hell, it worked for Ronnie and they named an airport after the guy.

|3.31.09 @ 10:17AM|#

Fritz sez: This time,we're gonna make money! Srsly! You can trust me, folks! Come on down, and buy a car!

Reinmoose Fuccillo|3.31.09 @ 10:19AM|#

It's YUUUUUUUUUUUUUUGEEEEEEEEEEEE

|3.31.09 @ 10:27AM|#

Debt Repudiation-

It's the fucking JUBILEE, motherfuckers!


So many people want Hummer, we don't know how to decide.

T|3.31.09 @ 10:27AM|#

I'd rather not have the government fixing anything I ride in at 70 miles per hour.

Where's your sense of adventure? Nothing like going on an airborne operation and remembering that every single critical component that keeps you from falling out of the sky was made by the lowest bidder. And that the actual production of the equipment is the smallest expense in the contract.

|3.31.09 @ 10:33AM|#

Moose, does Billy even sell GM or Chrysler?

|3.31.09 @ 10:38AM|#

Radical new idea! We're *thinking about* shutting down plants that build cars we can't sell!

Reinmoose|3.31.09 @ 10:38AM|#

I thought he sold just about everything

http://www.fuccillogm.com/

http://www.fuccillochrysler.com/

|3.31.09 @ 10:39AM|#

But what about my USED card warranty, Mr. President? WAH-WAH-WAH-WAH.....

|3.31.09 @ 10:40AM|#

CAR I mean, not CARD. (Goes to get some coffee)...

|3.31.09 @ 10:41AM|#

Probably does. I just haven't seen any GM or Chrysler commercials in these parts upstate.

|3.31.09 @ 10:42AM|#

Trade that old junkpile in, Don, and get a shiny new government-issue junkpile!

|3.31.09 @ 10:46AM|#

And to think I once snickered when driving past those "State Liquor Store" signs.

Will the next new Cadillac have the Presidential Seal on the hood?

Taktix®|3.31.09 @ 11:19AM|#

The sad part here is that Ford will be run out of town for NOT taking government cheese because they won't be able to compete with artifically-low prices due to subsidy...

I really fucking hate this guy...

|3.31.09 @ 11:29AM|#

The sad part here is that Ford will be run out of town for NOT taking government cheese because they won't be able to compete with artifically-low prices due to subsidy...

Punish the successful is a recurring theme in leftist economic theory. Some things never change. I've been saying for a while that Ford is getting a lubeless buttfuck over all this.

How many more cars would Ford be selling if GFM* didn't get all these taxpayer provided goodies and went rightfully belly up?

Probably enough to be making a profit this fucking year.

*General Fuckin' Motors.

Lyn|3.31.09 @ 12:19PM|#

Just be patient. It's all part of Obama's new Americorps mandatory volunteerism. Inner city kids are going to be drafted into Americorps and forced to take shop class. These kids will do all necessary auto repair work on your GM car, truck, or van.

Don't worry about a thing. If you are unsatisfied with the quality of service or repair work done by the highly motivated ghetto kids Americorps forces to volunteer then you are welcome to take your vehicle to your own mechanic. And pay for it yourself.

hmm|3.31.09 @ 2:01PM|#

"Where's your sense of adventure? Nothing like going on an airborne operation and remembering that every single critical component that keeps you from falling out of the sky was made by the lowest bidder. And that the actual production of the equipment is the smallest expense in the contract."

I'm getting old and have exhausted my stock of adventure through the use of lowest bidder items. I now prefer to generate my own adventure on my terms.

JB|3.31.09 @ 2:06PM|#

Only idiots will buy American cars now.

Obama is so fucking stupid.

|3.31.09 @ 4:38PM|#

The quality of GM's cars has been on a big upswing in recent years. I predict a big nosedive in quality if the government is honoring the warranty.

|3.31.09 @ 4:39PM|#

Don't forget that Obama will probably require union labor to perform warranty service.

|4.1.09 @ 9:18PM|#

JD,

Once Ford becomes insolvent due to the Free Volts for Everyone promotion(1), they can be bailed out by the government too.

If Obama plays his cards right, he can force every company into bankruptsy at a particular time, in order to smooth out the increase in the deficit each month. After the auto makers he can do each airline, department store, professional sports team, etc.

(1) phases out for "familes" earning 150k/yr.