You say Obama isn't a Socialist, huh?

[4G63]

http://www.foxbusiness.com/story/mar...tPaginationTop

GM CEO Wagoner to Step Down; Obama to Unveil Auto Plan

General Motors (GM: 3.62, 0.23, 6.78%) CEO Rick Wagoner is stepping down immediately, auto industry and White House sources told FOX Business on Sunday.

GM declined to comment on the report.

A White House official told FOX Business that Wagoner was asked by the Administration to step down as a precondition for the company to continue to get help with its restructuring.

"This does not surprise me... Rick has seen good and bad times and it seems that a fresh face is needed,” said Mike Green, president of United Auto Workers Local 652 in Lansing, Mich. "There are a lot of smart, capable people inside GM and this will not muck up anything moving forward."

Wagoner, 56 years old, began his GM career as an analyst in the company's Treasurer's Office in New York in 1977. He had been CEO of the auto maker since 2000.

News of Wagoner’s departure comes as the Obama Administration prepares to brief some people on Capitol Hill about its plans for the auto industry on Sunday evening, in advance of a formal announcement on Monday.

The plans will come from a task force put together by President Obama to figure out what the long-term plans for the auto industry should be, after GM received $13.4 billion and Chrysler, which is owned by private-equity firm Cerberus Capital Management, received $4 billion in bridge loans amid one of the worst downturns the auto industry has ever experienced.

GM in particular has been hemorrhaging cash, losing $9.6 billion in the fourth quarter of 2008 alone.

"We think we can have a successful U.S. auto industry," President Obama said on CBS's "Face the Nation" on Sunday. "But it's got to be one that's realistically designed to weather this storm and to emerge… much more lean, mean and competitive than it currently is."

Ford Motor (F: 2.8399, -0.0801, -2.74%), the other major U.S. auto maker, has thus far not needed bridge loans -- though it had initially left the door open to receiving them.

A source told FOX Business that the Obama Administration is likely to set a hard deadline for GM and Chrysler to meet their restructuring goals, which include getting bondholders and the United Auto Workers union to agree to major concessions. If they don’t meet those goals by the deadline, the source said, the auto makers would likely be allowed to enter into bankruptcy protection.

It’s possible the government would expand the bridge loans to allow the auto makers to survive through the new deadline.

Earlier this month, the Administration set up a plan for auto suppliers that basically serves as an insurance plan that, for a fee, guarantees payment for shipments to the auto makers. That plan could help keep suppliers shipping to the auto makers, even if bankruptcy looks likely.

“We are anticipating an announcement soon from the Administration regarding the restructuring of the U.S. auto industry,” GM said in a statement. “We continue to work closely with members of the Task Force and it would not be appropriate for us to speculate on the content of any announcement.”

Since when can a sitting President tell a publicly traded company who can run that company? Isn't that up to the shareholders? I have a feeling Obama won't tell UAW chief Gettelfinger to step down, though. He, his current and retired employees have put GM in the position they are now. I wonder if this "bailout" money will just go straight to this?

[Galen Sevinne]

I might agree with you premise IF the automaker was successful and financially independent. That is not the case though...the case is GM is asking for more money and more help. They submitted a business plan which did not appeal to the administration. Wagoner hasn't turned a profit since '04with GM. The admin has said if GM wants support, Wagoner needs to step down.

Now you can choose to just let GM fail but the ripple effect of that would be huge. I still think the whole "Obama is Socialist" line of thinking is over simplified and irrelevent.

If a company is relying on the government for help, there should then be a level of government intervention, oversight and accountability. You wouldn't agree with that? Or do you think GM should be left to fail and if you do think they should be left to fail, what would you propose for the additional millions of jobs that would be lost as a result AND the continuing ripple effect on the economy? Not to mention the end of an american industry that has been a source of american pride and middle class.

To sum all that up with "Obama is a Socialist" seems pretty shortsighted and naive.

This country has a wealth of productive socialist programs. People are easily fooled that democratic socialism is just a hair away from communism. Couldn't be further from the truth.

[jonboy79]

BANKRUPTCY- it is the answer. Let a judge dramatically weaken the UAW contraact, and give the American Auto makers a fair shot to compete in the worldwide market. It is the only answer. If Obama doesn't make drastic policy changes soon, it will also be the only possible future of the US as a coutnry.

[Galen Sevinne]

BANKRUPTCY- it is the answer. Let a judge dramatically weaken the UAW contraact, and give the American Auto makers a fair shot to compete in the worldwide market. It is the only answer. If Obama doesn't make drastic policy changes soon, it will also be the only possible future of the US as a coutnry.

American banks couldn't afford what it would financially take to restructure GM through bankruptcy. The only body that could is the US Govt. But uhhhh...then you guys will cry socialism and Trap will cry Stalinist communism.

Obama's approach is to give the automakers and UAW 60 days to work out an agreement that would do exactly what you are saying to allow them to be more competitive. Part of the problem is this new UAW agreement will also have to address pensions to the retirees who depend on that retirement to live. Losing that (and making u.s. automakers more competitive) will leave a lot of retirees w/o income so then what happens?

Obama is making drastic changes. Your plea to restructure the UAW contract involves health care which is exactly why Obama is combining healthcare reform in his budget. But then the GOP complains that Obama is doing too much.

Funny how everything you complain about in your post and what it seems like you are asking for is exactly what Obama's admin is addressing. You don't see it though because you have a need to fly your conservative flag and overlook Obama's greater vision for the future.

[4G63]

American banks couldn't afford what it would financially take to restructure GM through bankruptcy. The only body that could is the US Govt. But uhhhh...then you guys will cry socialism and Trap will cry Stalinist communism.

Obama's approach is to give the automakers and UAW 60 days to work out an agreement that would do exactly what you are saying to allow them to be more competitive. Part of the problem is this new UAW agreement will also have to address pensions to the retirees who depend on that retirement to live. Losing that (and making u.s. automakers more competitive) will leave a lot of retirees w/o income so then what happens?

But its not just income, its ALL of their health benefits. They didn't pay a penny from the day they were hired til the day they died. Why can't they pay part of their salary/retirement towards their healthcare costs?

Obama is making drastic changes. Your plea to restructure the UAW contract involves health care which is exactly why Obama is combining healthcare reform in his budget. But then the GOP complains that Obama is doing too much.

His healthcare budget has nothing to do with GM's healthcare budget. GM's needs to be restructured with the UAW, not the UAW's with the US gov.

Funny how everything you complain about in your post and what it seems like you are asking for is exactly what Obama's admin is addressing. You don't see it though because you have a need to fly your conservative flag and overlook Obama's greater vision for the future.

It has nothing to do with flying a conservative flag, it has everything to do with how the UAW has screwed the US car companies to the tune of $$$Billions per year worth of healthcare, with no contribution from its employees. Why can't they contribute? Most people I know don't have 100% covered insurance from their employer. They contribute a certain percentage of their pre-tax income towards it. Whats wrong with that?

The real kicker is the VEBA contract. Ron Gettelfinger, the UAW boss-man, saw the writing on the wall and rather than do what I suggested above, pushed for the VEBA contract. Ronnie-boy knew that GM, Ford, and Chrysler wouldn't be able to keep up with the Toyota's, Honda's and Nissan's that manufacture vehicles in the US (and their employees who aren't covered by UAW's shitty Union) so he pushed for binding payments into VEBA by the Big 3.

[4G63]

What, no takers?