Playing chicken with a fiscal cliff isn't a new game in Washington. In 2008, when Congress voted down a rescue package for General Motors, Chrysler and their finance arms, the pressure on then-President George W. Bush to keep the automakers in business until Barack Obama took office grew intense. His top aides told Bush that letting GM and Chrysler collapse could trigger all kinds of financial calamity and up to 1 million lost jobs. So, under duress, Bush agreed to lend the companies $17.4 billion — just enough to get them through a few weeks.
Five years later, the U.S. Treasury has sold its last shares of GM; Chrysler paid back most of its loans a couple years back. The government lost $10 billion on its GM stake, and its still seeking a way out of Ally Bank, the remnants of the former GMAC — but both GM and Chrysler will post sizable profits this year, and GM just announced $1.3 billion in U.S. factory upgrades. Since he's left office, Bush has defended the call, saying if given the same choice, he'd do it again.
- Politics & Government
- Barack Obama