America's Auto Bailout

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In 2008, the automotive industry suffered a big hit which caused a crisis in the United States economy. During the 2000s there was a phase known as the “SUV CRAZE” where the majority of sales for General Motors (G.M.) and Chrysler were “pickup trucks and sports utility vehicles”(Auto Industry Crisis). Trucks and SUVs have been known to use a lot of gasoline to help with their overall performance. But during 2003, the price of oil per barrel “went up from $30 to $135”(Rod Franchi). This caused the price of gasoline to rise and discouraged people from buying these big trucks that would use a lot of gasoline. This caused everything in the auto industry to go downhill. In 2007 around 16 million were sold, but in 2009 that number went down to 9 million cars sold. Now with fewer cars being sold G.M. and Chrysler were losing money and was desperate for help. With congress trying to find a solution, they proposed an auto bailout that would help the industry from dying. Although many argue the bailout gives an excuse to big car companies to fail, it was necessary because it helped save and create millions of jobs around the country. The auto bailout was an $80 billion bailout issued to G.M. and Chrysler to stimulate the growth and production of the automotive industry. The government made the bailout because it had three main objections: Save jobs, improve the economy, and get repaid as by G.M. and Chrysler (“Successful Bailout”). But there was a big problem that happened. G.M. and Chrysler could not pay back the debt that they had because they didn’t gain enough money to pay back the debt. This worried the government and the people of the United States because if the bailout failed then the whole automotive industry would die. So the gov... ... middle of paper ... ...6 Sept. 2010: n. pag. Issues and Controversies. Web. 21 May 2014. Bump, Philip. "The Auto Bailout Saved 1.5 Million Jobs- And Likely Made $50,000 On Each One." The Wire 9 Dec. 2013: n. pag. Print. Dionne, E. J., Jr. "The Auto Industry Lives. Can We Admit That Government Intervention Worked?" Washington Post 2 Aug. 2010: n. pag. Print. Franchi, Rod. "Guided Notes on Curing the Great Recession Lecture." Novi High School. Lecture. Frontline: Inside the Meltdown. Dir. Michael Kirk. 2009. Film. Hassett, Kevin A. "Obama's auto-bailout fiction." Editorial. National Review 3 Apr. 2012: n. pag. Print. Rattner, Steven. "Delusions About the Detroit Bailout." The New York Times 23 Feb. 2012: n. pag. Print. - - -. The 2009 Bailout Was Necessary, Argues Rattner. N.p.: Stanford Business, 2011. Print. "The Unpopular, Succesful Auto Bailout." The American Prospect: n. pag. Print.

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