Bankrupt Bailout Spends Billions to Shut Factories

posted by John Nichols on 05/02/2009 @ 07:02am

President Obama says that, after the brief inconvenience of a bankruptcy filing and the ensuing reorganization, Chrysler will "a going concern" with "a strong chance of success."

"The necessary steps have been taken to give one of America's most storied automakers, Chrysler, a new lease on life," argues Obama.

That sounds good. And Obama is not just offering rhetoric. The federal government has loaned Chrysler more than $4 billion and indicated a willingness to pump billions more into the fight for the carmaker's survival.

Unfortunately, Chrysler officials indicated on Friday that, while the company plans to survive, thousands of Chrysler workers – and the communities where they live – are not likely to make it.

On Friday afternoon, Chrysler LLC acknowledged – after the fact was revealed in documents filed as part of the bankruptcy proceedings -- that eight of the company's factories will not be transferred to the "new Chrysler," which will be co-owned by Italian carmaker Fiat Group SpA.

Rather, the auto firm announced, most of these factories are now "scheduled to close by December 2010."

The five plants that are most likely to be shuttered -- in Michigan, Missouri, Ohio and Wisconsin – employ close to 5,000 people. [more]