GM And Chrysler Handpick Auto Suppliers For Bailout

How the federal government will bail out these small businesses.

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We know that many small auto suppliers depend upon the Big 3 for business. Indeed, one of the main justifications for the Detroit bailout has been that we cannot allow these small(er) businesses to be run into the ground.

The Washington Post today has some details about how the federal government plans to help these businesses.  It seems that the people who get to call the shots on which suppliers receive aid are the very companies whose mistakes have put the suppliers in jeopardy:

Treasury left it up to General Motors and Chrysler to decide which suppliers would be eligible for the aid. GM will initially get $2 billion in federal support, and Chrysler will receive $1.5 billion. Ford declined to participate, saying it had enough funds to support its supply base. In all, the government said it is prepared to set aside $5 billion to help finance the deals.

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small business

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