UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who has covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

May 8, 2009

CRASH TALK


BBC - The UN's head of environment has been left "stunned" by the billions of dollars pumped into ailing companies following the global financial crisis. Achim Steiner told the BBC One Planet program that he had fought for years to secure much smaller sums to tackle poverty and climate change. "We waited perhaps a decade to get $5bn to accelerate development of renewable energy," he said. "We now see $20bn paid [to] a car company simply to keep it alive." Over $11trillion (£7tn) has been spent on bank bailouts in the UK and the US alone. Billions more has been promised in aid for struggling industries, such as automotive manufacturers.

But Mr Steiner, who is based in the Kenyan capital of Nairobi, warned we are passing the bill to the next generation, and stressed that if extra investment is not found to tackle climate change, the bail-outs would be "a terrible waste of money".

Despite the urgency of governments to ensure financial institutions do not collapse, Mr Steiner urged the public not to be "sold the false story" of banks having to be fixed before worrying about other issues such as environmental protection.

If that did happen, Mr Steiner believes it would represent "the greatest political tragedy of the last five decades".

In the interview, the Brazilian-born UN director also suggested the world's richest countries could make huge inroads to tackling climate change by adding $5 to the cost of a barrel of oil - which he estimates would raise over $100bn to invest in new technology.

Pro Publica - It is surprisingly difficult to get a handle on the growing Chrysler bailout. Little more than a week ago, the toll stood at a simple, round $4 billion. Since then, the bailout has grown three-fold. By our count it currently stands at $12.5 billion, which accounts for all the aid the Treasury has pledged to Chrysler before ($4.5 billion), during ($3.3 billion), and after bankruptcy ($4.7 billion). . .

The reality is that much of the money loaned to Chrysler before and during its bankruptcy process won't be recovered, said an administration official, speaking for the Auto Task Force, which is a joint effort of the White House and Treasury. (We tried to get the official to speak for attribution, but the official declined.) The face value of the $4 billion loan approved by the Bush administration will be by and large written off during the bankruptcy process, according to the official and Chrysler's bankruptcy filings. The administration has also pledged to give Chrysler up to $3 billion to keep the company afloat during restructuring.

So that's about $7 billion gone right there. The administration will do what it can to recover a portion of that money, said the official. A "loss-sharing agreement" between Chrysler and the administration will mean "some" of the $4 billion will be recovered. And the Treasury will get an eight percent stake in the Fiat-Chrysler alliance when it emerges from bankruptcy, along with warrants in the company, in exchange for the aid.


1 Comments:

Anonymous Anonymous said...

This century seriously sucks.

May 8, 2009 4:39 PM  

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