The auto bailout decision

CNN:

President Bush said Friday the federal government will provide $13.4 billion in loans to automakers General Motors Corp. and Chrysler to prevent "an unacceptably painful blow" should the Detroit giants fail.

Bush said in normal economic circumstances he would not intervene to save the automakers but "in the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action."

Federal intervention is necessary, he said, to give auto buyers faith in their purchases of domestic vehicles.

"If you hear that a car company is suddenly going into bankruptcy, you worry that parts and servicing will not be available, and you question the value of your warranty.

"With consumers hesitant to buy new cars from struggling automakers, it would be more difficult for auto companies to recover," Bush said. Watch Bush announce help for GM, Chrysler »

A senior administration official briefing reporters said he expects that GM and Chrysler officials will be signing the loan papers to access the cash later Friday.

Ford Motor Co. is in a better financial position than GM and Chrysler and is not included in the loan plan. iReport.com: How does the auto bailout affect you?

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Did you know that you can still get parts for a Model T or Modal A Ford? You can't get them from a dealer, but there are many sources available through mail order and the internet. You could probably get the parts for your newer autos from the same source the auto companies used if the auto companies went out of business.

That said, I do not want these companies to go out of business and if the terms of the loan are such that they will become more competitive, that is better for them and the consumer. I suspect that the administration is imposing conditions that are pretty close to what Sen. Corker had been pushing. There would be some irony in that.