bailout!

The White House will enable Detroit's ailing automakers to survive a little longer by providing low-interest loans, FOX News
has confirmed.

President Bush will make a statement on the rescue plan at 9 a.m. Friday. Under the proposal, General
Motors and Chrysler will be able to make it into the new year when President-elect Barack Obama takes the reins of power.

Treasury Secretary Henry Paulson said at a business forum Thursday night that the "ultimate success" of any program, though, will
be determined by the "will and the ability of the next president ... and the next Congress." 

According to ABC News, which first reported details of the plan, the loans come
with strings attached. The automakers will need to restructure, getting
tough concessions from creditors, suppliers and the labor union. 

The Bush administration claimed it was convinced
the ailing economy could not withstand the demise of Detroit's Big Three. 

The White House decision comes as carmakers
suffer from their slowest sales in 26 years and dwindling operating cash.

Bush administration officials were reviewing several approaches to assisting
the automakers, including short-term loans from the Treasury
Department's $700 billion Wall Street rescue program. 

Paulson told the forum in New York on Thursday that while bankruptcy for the automakers
should be averted if possible, an "orderly" reorganization might be the best solution.

"If the right outcome is reorganization or bankruptcy, then isn't it better to get there through an orderly process?" Paulson asked.

Paulson said President Bush wants to avoid bankruptcy -- "if it can be
avoided." But Paulson said the No. 1 priority was getting U.S.
automakers back on a viable path. Part of that effort, he said, would
require all sides making sacrifices to boost competitiveness with
foreign carmakers.

"It's difficult to do such things outside of reorganization," he said. "But sometimes that can be
successfully done."

"When you look at the size of this industry and look at all those that it touches in terms of suppliers
and dealers ... it would seem to be an imprudent risk to take," he said.

The Big Three automakers said anew on Thursday that bankruptcy wasn't the
answer, as did an official of the United Auto Workers who called the
idea unworkable and even dangerous. For unions, bankruptcy could mean
voided labor contracts and renegotiation of benefits. The car companies
argue that no one would buy a vehicle from a bankrupt company for fear
that the company might not be around to honor warranties or maintain a
supply of spare parts.

The National Automobile Dealers Association also spoke out against bankruptcy "in any way shape
or form, orderly or disorderly, prepackaged or unpackaged, managed or unmanaged," said spokesman Bailey Wood.

The White House has repeatedly emphasized its opposition to "disorderly
bankruptcy" -- presumably filing under Chapter 7 of the bankruptcy act
that would effectively shut down a company and require sale of its
assets. That has left the possibility of one or more of the automakers
filing under the act's Chapter 11, which allows a firm to operate while
it reorganizes under a court's supervision.

"A disorderly bankruptcy of these companies is just not acceptable," White House press secretary Dana Perino told CNN's Larry
King Thursday night. "It would be such a severe body blow to our economy right now, that we just could not sustain it."

While they wait for a rescue package, the automakers have announced extended
holiday shutdowns. Chrysler is closing all 30 of its North American
manufacturing plants for four weeks because of slumping sales; Ford
will shut 10 North American assembly plants for an extra week in
January, and General Motors will temporarily close 20 factories -- many
for the entire month of January -- to cut vehicle production.

The Associated Press and FOX Business Network's Peter Barnes contributed to this report.

Okay, so it seems that Bush is going to pass this supposed crisis along to the Obama administration. 

Politically, its not a bad move, he's a lame duck with less than two months to go. Anything more broad reaching and he will be facing criticism for decades if it goes up in flames six months down the road. 

Economically...

I don't do economics, I don't know jack squat about economics. What I do know is that I can not understand why three companies who have admitted, in front of cameras, congress and lord only knows how many TV viewers that they mismanaged their assets get a tax-payer funded pass on what would normally be the logical conclusion to bankruptcy. 

Sigh....

What else is their to say?