I was hoping that someone would have asked the question “Why did Bush offered this money in the first place?”.
I will not only ask the questions but will also try to answer it too.
And the answer is quite simple; screw Obama and his economic team even more!
This rescue effort has nothing to do with saving jobs, helping the economy and keeping US automakers in business. Nope.
Let me elaborate why I have arrived at this conclusion.
Bush initiated this move by an executive order; since there was not enough support in either the House or the Senate, on both sides of the aisle, to pass any package before Obama takes office. That would have been too late for GM and Chrysler.
Union workers that are employed by these automakers vote for Democrats overwhelmingly.
UAW has publically scorned Republican policies to curtail their influence at any chance they had.
If GM and Chrysler go into Chapter 11 bankruptcy, Obama will not have to deal with the mess at a level where it is now. Obama can very easily state that he and his team had NO legal authority to intervene before taking office.
This is an excellent opportunity for Bush to put Obama and his team to commit to a very unpopular issue amongst the voters and it can be used quite effectively in midterm elections, in two years, against all Democrat candidates.
A politician always takes care of the politics before anything else.
If Bush didn’t offer this money, GM and Chrysler would have presented a much smaller problem for the new president; since they would have been in reorganization bankruptcy by the time Obama takes office. So, Bush and his advisers decide to offer just enough money to let them survive long enough for Obama to take office. At that point, Obama will either have to offer them more money, an extremely unpopular option amongst likely voters, or let them go into Chapter 11 bankruptcy. In either case, Republicans win. They win votes.