“Sachs’ testimony was striking in that he gave no ground when lawmakers complained that their constituents would be ‘mad’ with them for helping the auto companies.
‘They are going to be very mad when unemployment reaches 9%; they will be really mad if unemployment reaches 12%,’ he told Rep. Jackie Speier (D-Calif.). ‘If we allow the most important industry in this country to disintegrate, believe me, the fury will be nothing like what will happen when they hear about this kind of bailout.
‘We have to take the macro-economics seriously right now. We’re in the steepest descent we’ve been in in modern times. This is crucial to stop this. So the American people need to understand. This isn’t a favor for the industry. This is a favor for the American people… This is to brake a collapse of our economy that is under way right now.'”
“If there was ever any question whether Congress actually wants to ‘save’ Detroit, this week dispelled it. This is not a bailout that Congress is debating. It is a federal takeover. We don’t mean that in the sense that the feds will own the companies on paper, although that can’t be ruled out. What Congress wants to own is their business plan, and Detroit seems prepared to oblige…
The car makers’ request for a bridge loan, by contrast, looks like a $34 billion bridge to nowhere. It has already morphed into an opportunity for political extortion — and we don’t even have a bill yet. When, in a couple years, costs have not come down as expected because of political pressure to keep the unions happy and the green cars aren’t selling — because they were designed in Washington, not for consumers — the companies will be back for more money.”