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Obama: Taxpayers Will Guarantee Their Own GM Warranties

Barack Obama says the US government will guarantee the warranties for GM vehicles.

It is my hope that the steps I am announcing today will go a long way towards answering many of the questions people may have about the future of GM and Chrysler. But just in case there are still nagging doubts, let me say it as plainly as I can -- if you buy a car from Chrysler or General Motors, you will be able to get your car serviced and repaired, just like always. Your warrantee (sic) will be safe. In fact, it will be safer than it's ever been. Because starting today, the United States government will stand behind your warrantee (sic).

In other words, you the American taxpayer will be paying for your own GM warranties. Your taxes will just be recycled through the government first before they're sent to the dealerships to pay for warranty work. So, taxpayers would be smart to avoid purchasing GM vehicles all together in order to save themselves some money. As I've said before, everything this administration touches it ruins.

Rush is talking about this now, and he's absolutely right when he predicts that eventually you will find union members and environmentalists on the board of directors and that GM will begin making the cars the environmentalists want. He also predicts that GM will ultimately be run and owned by the UAW, as a pay back to the union. Rush called it a union coup - and he's spot on. As a result, the UAW won't have to make any concessions, at least none of any significance, in this deal.

My husband and I will be in the market for a new vehicle in September. I can tell you right now we will not purchase a GM or Chrysler vehicle. Instead, we're looking at a Ford first and then Honda and Toyota, and one of the reasons is because Ford turned down government money. I would have had a lot more respect for GM and Chrysler for that matter if they had declared bankruptcy. At least they would still be autonomous organizations. Now they're just another arm of the US government and will be run by politicians and bureaucrats who have not run even one small business before, let alone an auto company.

Added: Obama can't prevent GM from still entering into Chapter 11. If this new CEO Fritz Henderson has any intelligence at all and truly wants to save his company, then he will contact his attorneys and enter Chapter 11 immediately and stop this UAW coup.


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Comments (67)

I sure hope they don't brin... (Below threshold)
Matt:

I sure hope they don't bring in consultants from the former Soviet Union or former East German car companies. They were so well known for efficiently manufacturing cars. Trebant anyone?

SEIU to run socializ... (Below threshold)
macofromoc:


SEIU to run socialized medicine next????

Kim -- If you guys... (Below threshold)
James H:

Kim --

If you guys are in a snowy area, I heartily recommend a Subaru.

Obama certainly does have t... (Below threshold)
914:

Obama certainly does have the midas touch does'nt He.

"It's better this way; it w... (Below threshold)
Dan Patterson:

"It's better this way; it won't hurt a bit"

Consider also that once the... (Below threshold)

Consider also that once the company is longer on the hook for warranty repairs they will have a no reason to care about the quality of the product.

It was just reported that W... (Below threshold)
Hermie:

It was just reported that Wagoner will get a 20M golden parachute.

That's 20M of taxpayer money that Obama has thrown out the window.

If GM had been allowed to go bankrupt, then this payout would have been included in the Chapter 11 proceedings.

Way to go Barry! Will you proclaim 'OUTRAGE!' about this payout, or will you just be 'STUNNED'?

I also wonder if GM will re... (Below threshold)

I also wonder if GM will reduce the price of a car by the cost of the warranty. If not and you buy a GM vehicle you are paying for the warranty twice. And that makes you a chump.

I want to thank you all for... (Below threshold)

I want to thank you all for picking up the warranty on my Chevy Tahoe.

In the future I would appreciate it if you washed and waxed the car when I bring it in for service!

thx again!

"GM will begin making the c... (Below threshold)
GarandFan:

"GM will begin making the cars the environmentalists want."

And no one will buy them. Go figure.

I can see it now- the Obama... (Below threshold)
Dave:

I can see it now- the Obama designed and inspired vehicle. It will probably look like the car Homer Simpson designed for his long lost brother on that episode of the Simpsons.

Obama will go from saying "... (Below threshold)
retired military:

Obama will go from saying "They are too big to fail" to "We have too much invested to let them fail".

I, for one will never buy another GM CHrysler product.

If they go Bankrupt now they will save me money down the road.


Obama has decided that GM a... (Below threshold)
sam:

Obama has decided that GM and Chrysler will return to car-making glory by building golf carts and moon buggies.

I think this will be the re... (Below threshold)
engineer:

I think this will be the return of the Chrysler K-car.

How soon before there isn't... (Below threshold)
engineer:

How soon before there isn't enough money for all the warranty work, and they start rationing repairs?

"How soon before there isn'... (Below threshold)
sam:

"How soon before there isn't enough money for all the warranty work, and they start rationing repairs?"

It won't come to that. People will just stop buying GM and Chrysler cars.

In this context, my admi... (Below threshold)

In this context, my administration will offer General Motors adequate working capital over the next 60 days. During this time, my team will be working closely with GM to produce a better business plan.

When was the last time government gave the business world a business plan that business actually wanted to emmulate or follow, let alone one endorsed by a community organizer.


Cue the crickets and tumbleweeds sound effect...again....

Sure didn't buy one this la... (Below threshold)
JLawson:

Sure didn't buy one this last weekend... and now I understand why the salesmen were so... lethargic! They were practicing the new 'Government Sales Model' - "I get paid the same whether you buy or not, and it's less hassle for me if you don't."

"Your warrantee (s... (Below threshold)
marc:
"Your warrantee (sic) will be safe. In fact, it will be safer than it's ever been. Because starting today, the United States government will stand behind your warrantee (sic)."
Would those be similar to the barack hussein obama warranties he attempted to void the wounded U.S. veterans had?

Or like the barack hussein obama warranties given on no lobbists, no earmarks, no AIG bonuses and posting online any bills 5 days in advance of their being signed? (He's 0 fer 10 on i8n that regard)

As a side note: Where, oh where are all the barack hussein obama defenders? Are they all in line for their first crack at buying a 2012 Obmamamobile?

Buy G.M.Hell, I'll... (Below threshold)
xiphos:

Buy G.M.

Hell, I'll even help pay for you're extended warranty!

Of course, that's after I get my shares of stock in all the companies that WE bailed out............

Holding my breath now.

"Buy G.M."<p... (Below threshold)
marc:

"Buy G.M."

Government Motors?

In other words, you the ... (Below threshold)
Brian:

In other words, you the American taxpayer will be paying for your own GM warranties. Your taxes will just be recycled through the government first before they're sent to the dealerships to pay for warranty work. So, taxpayers would be smart to avoid purchasing GM vehicles all together in order to save themselves some money.

Does Kim understand the difference between "guaranteeing" something and "paying for" something?

"Does Kim understand the di... (Below threshold)
sam:

"Does Kim understand the difference between "guaranteeing" something and "paying for" something?"

Does Brian understand anything about contracts and liabilities?

So, let's see. Obambi speak... (Below threshold)

So, let's see. Obambi speaks, and the market is down over 250 today. Good job, B.O.!

Soon to be heard by GM cust... (Below threshold)
retired military:

Soon to be heard by GM customers everywhere

"Why yes your car's transmission is fully covered by the GOVT backed warranty plan. We have an opening for you THREE YEARS from now next Tuesday. Shall we say 10 AM? And might I say that our service department has recently cut the time for transmission repairs in half. Now it will only take us 6 months to get your car back to you. Isnt that wonderful?
"

Gee, sam, thanks for school... (Below threshold)
Brian:

Gee, sam, thanks for schooling us on financial accounting basics. I had no idea that I no longer need to pay back any of my federally-guaranteed loans, since the taxpayers are paying them for me now. And now my banks don't have to give me my money upon request, since the federal guarantee will take care of it for them. Thanks for waving your hands and setting us straight!

So, let's see. Obambi sp... (Below threshold)
Brian:

So, let's see. Obambi speaks, and the market is down over 250 today.

You must have been saving that one up for a while. Glad you were able to get it out of your system.

"Why yes your car's tran... (Below threshold)
Brian:

"Why yes your car's transmission is fully covered by the GOVT backed warranty plan. We have an opening for you THREE YEARS from now next Tuesday....

"Oh, wait, what am I saying? The government isn't actually operating our repair business! They just guaranteed to pay us after the company you bought your warranty from filed for bankruptcy and told you to take a hike. You should be glad they did that. Otherwise I'd be out of a job, and you'd be out of a warranty. I must have been totally stupid for saying that first thing about three years from now! Anyway, how's next Tuesday?"

<a href="http://www.autoext... (Below threshold)
marc:

Peter M. De Lorenzo

After arguing vehemently against bankruptcy for GM since last December, the President's speech this morning got me to shift my thinking. Why wait 60 days at all? Given that Obama and his crew are basically telegraphing the fact that they are going to move GM toward bankruptcy anyway, I recommend GM cut a deal with the Obama administration to go to bankruptcy immediately, with the following conditions: 1. Obama becomes "Car Salesman in Chief" and he and his wife participate in a one-hour infomercial that will tout American cars complete with proof points as to why they're worth buying. 2. The government guarantees warranties for all GM cars and trucks and makes sure every American knows it via "live" read advertisements at the end of Obama's weekly radio addresses. And 3. Offer $5,000 to every American who purchases a car assembled in North America (domestic or import).
Yeah, what he said.

A point missed... supposedly Chrysler is being pushed/forced into a merger deal with Fiat.

Something was missing from barack hussein obama's "Chrysler Plan," there was no mention of Cerberus Capital Management who bought out the company from Daimler.

Additionally, what of barack hussein obama's plan to cut all the tax bennies from companies that gain profits from overseas markets?

What does that do for any possible Fiat merger?

You must have been savin... (Below threshold)

You must have been saving that one up for a while. Glad you were able to get it out of your system.

The market lost 3.27% of its value today; largely wiping out most of last week's gains. Thus, to some degree, wiping out a week in your two-week retort.

And it hasn't had anywhere to go BUT up since bottoming at 6440 on 3/9.

Just sayin'....

BrianLook at govt ... (Below threshold)
retired military:

Brian

Look at govt "paid for" programs now (after all the govt is gaurenteeing things right so the govt is paying for them in essence). Lets see. GM dealership gets money from customer for work done right away. GM Dealership gets money from govt after reams of forms to fill out and waiting 6 months . Who do you think they are going to take care of first? After all if the govt is paying for it then the customer has no choice but to go to them correct? And the govt has no incentive to make the customer happy so we can have "Govt Experts" go through things needed for your car sorta like they are going to do with medical care, you know to keep costs down.

But I wont have to worry about it. As I wont buy GM until the US GOVT gets their hands out of it. Unless of course I am mandated to buy a GM car by the Auto maker in chief, Barrack Obama. Or should I say the teleprompter automaker in chief.

The transmission in my Chev... (Below threshold)
John S:

The transmission in my Chevy Malibu is defective. The replacement is $3.5 billion. Who in Washington do I contact for my check?

Brian:Money and fi... (Below threshold)
sam:

Brian:

Money and finance does not seem to be your strong suit.

"I no longer need to pay back any of my federally-guaranteed loans, since the taxpayers are paying them for me now."

Do you even comprehend who is guaranteeing what?

US Govt. is promising to pay for all defects of GM products. Once it starts giving bailout money, it is ipso facto paying for GM's warranty costs (and salaries, and Super Bowl advertising, and health care costs, and Buick Invitational sponsorship).

As a student-loan consumer, the govt can come after you for the money it lent. It is not doing the same for GM; instead it is shoveling more money after the first batch is gone. It is as if, if you defaulted on your student loan, you could be in line for another installment.

"Otherwise I'd be out of a job, and you'd be out of a warranty."

Not me, I have never and would never touch a GM piece of crap with a ten-foot pole.

Don't worry, GM (and Chrysler) will go under. It is only a matter of time.

The market lost 3.27% of... (Below threshold)
Brian:

The market lost 3.27% of its value today; largely wiping out most of last week's gains. Thus, to some degree, wiping out a week in your two-week retort.

Actually, it was a one-month retort, not two-week, and today's drop made only a slight dent in it.

But a week ago the market gained 7% in one day. Another two weeks before that, it gained 6% in one day, and 3% a couple of days later.

My point is that it would be just as idiotic to come on here with "Obama must be great" every time the market has a good day as it was for #24 to gloat that today the market had a bad day.

after all the govt is ga... (Below threshold)
Brian:

after all the govt is gaurenteeing things right so the govt is paying for them in essence

Ah, so you don't know what you're talking about. Thanks for clearing that up.

"after all the govt is gaur... (Below threshold)
sam:

"after all the govt is gaurenteeing things right so the govt is paying for them in essence"

Ah, so you don't know what you're talking about. Thanks for clearing that up.

Brian: what's so hard to understand? GM is paying for warranties, and US govt. is paying GM boatloads of bailout money. How is the US govt. not paying for GM warranties?

Money and finance does n... (Below threshold)
Brian:

Money and finance does not seem to be your strong suit.

Actually, the problem is that reading comprehension and staying on topic aren't yours.

Do you even comprehend who is guaranteeing what? US Govt. is promising to pay for all defects of GM products.

Yes, IF GM CAN'T.

As a student-loan consumer, the govt can come after you for the money it lent.

But I'd be bankrupt, so they can't get anything. Woo-hoo! Like I said, the taxpayers will be paying my loan for me. Let's protect the taxpayer and do away with federally guaranteed student loans so I can't take advantage of that attractive loophole!

Oh, and if I try to take my money out of a bankrupt bank? Who will the FDIC go after to recover that money? The taxpayer! Let's protect the taxpayer and do away with federally guaranteed banks!

To paraphrase Kim's first paragraph:

In other words, you the American taxpayer will be paying for your own bank deposits. Your taxes will just be recycled through the government first before they're sent to the banks to pay your balance. So, taxpayers would be smart to avoid putting their money in banks all together in order to save themselves some money.

GM (meaning pre-Governmant ... (Below threshold)
marc:

GM (meaning pre-Governmant Motors) your defective tranny is brought to the dealer for repair as it still on warranty, GM has to absorb the cost of repair.

Government Motors - your defective tranny is brought to the dealer for repair as it is still on warranty, considering it's now an ObamaMobile AND "starting today, the United States government will stand behind your warrantee" [sic] all is well. Unless your a taxpayer.

Easy to understand, but not for our resident Contrariant-in-Chief brian.

"You must have been savi... (Below threshold)
914:

"You must have been saving that one up for a while. glad You got it out of Your system"

Yeah for about 4 or 5 days...since the last time this idiot opened His mouth and sank the Titanic.

Brian: what's so hard to... (Below threshold)
Brian:

Brian: what's so hard to understand? GM is paying for warranties, and US govt. is paying GM boatloads of bailout money. How is the US govt. not paying for GM warranties?

That's a simplistic argument. GM is paying for plant-watering services at is headquarters, so we should rail against the government paying for plant-watering services?

Besides, the argument isn't that the government is paying for warranties. It's that they're guaranteeing them. While GM exists, they're not the same, which is my original point.

For Brian, in s-l-o-w caden... (Below threshold)
sam:

For Brian, in s-l-o-w cadence, so he can comprehend:

G-M p-a-y-s warranty costs, and

U-S g-o-v-t pays GM.

Ergo, U-S g-o-v-t pays warranty costs.

Not hard to understand, basic knowledge. Apparently too hard for Brian.

sam, I'll assume that you d... (Below threshold)
Brian:

sam, I'll assume that you didn't read my #40 comment before you posted your #41 comment. Because if you did, then you're either pretending to be daft or you really are.

Brian:I read your ... (Below threshold)
sam:

Brian:

I read your comment and got confirmation that you are a fool.

As I said in my earlier post, US govt is paying for every expense of GM - warranty costs, plant-watering, Super Bowl ads, golf sponsorship, NCAA basketball sponsorship.

GM does not have money to pay for anything.

brian - "GM is paying f... (Below threshold)
marc:

brian - "GM is paying for plant-watering services at is headquarters, so we should rail against the government paying for plant-watering services?"

I agree. Fuck their plants AND the cost of watering them.

brian - "Besides, the argument isn't that the government is paying for warranties. It's that they're guaranteeing them. While GM exists, they're not the same, which is my original point.

umm, where have I heard that before? Oh yeah, the two Fannies.

The gov went far out of their way to guarantee low cost loans and backed the Fannies, consequently many banks followed suit.

And we all know where that led.

As I said in my earlier ... (Below threshold)
Brian:

As I said in my earlier post, US govt is paying for every expense of GM

That is not the topic of this thread, nor the topic of my comment. If you want to complain about GM's bailout, I'm sure you can find many threads where you can do so.

They should of just made th... (Below threshold)
ravenshrike:

They should of just made this guarantee before the first bailout and forced them into bankruptcy. Then the cost of the warranties would be taken out of the bailout. Thus negating the need to deal with the ongoing bullshit.

Cute diversion brian. Are w... (Below threshold)
marc:

Cute diversion brian. Are we to truly believe you see no connection between the bailout and the specific topic of this post?

Here's a ? fer ya brian, does obama have the authority to fire GM's CEO.

i.e. is obama "the government" in the context of bailouts/guarantees?

Hey moron Brian: It is not... (Below threshold)
sam:

Hey moron Brian: It is not your blog, so don't tell anyone what to write where.

Brian Dont tell us what ... (Below threshold)
419:

Brian Dont tell us what to comment on or not! Who do You think You are?? Obama?

"Buy G.M."Y... (Below threshold)
419:

"Buy G.M."

You mean General Mobsters right?

HatTip to the Mark Levin sh... (Below threshold)

HatTip to the Mark Levin show:

GM/Chrysler Warranty Hotline 202-456-1414

call now...but be prepared for them to try and duck you (I spelled that right, didn't I?)

remember:
GM/Chrysler Warranty Hotline 202-456-1414

BrianQuit being so... (Below threshold)
419:

Brian

Quit being so negative

But I'd be bankrupt, so ... (Below threshold)
James Cloninger:

But I'd be bankrupt, so they can't get anything. Woo-hoo! Like I said, the taxpayers will be paying my loan for me. Let's protect the taxpayer and do away with federally guaranteed student loans so I can't take advantage of that attractive loophole!

Well, no, not exactly.

They can (and will) garnish up to 15% of your future wages, and they will collect your federal tax refunds.

Cute diversion brian. Ar... (Below threshold)
Brian:

Cute diversion brian. Are we to truly believe you see no connection between the bailout and the specific topic of this post?

If the government is paying for "every expense of GM" as sam claims, then the fact that they're guaranteeing the warranties is not news, as Kim thinks it is.

If the government guaranteeing the warranties is news, then they're not paying for "every expense of GM", as sam thinks they are.

So who's wrong? Kim or sam?

Hey moron Brian: It is n... (Below threshold)
Brian:

Hey moron Brian: It is not your blog, so don't tell anyone what to write where.

I'm sure the irony that I didn't tell you to do anything, and it's you who are telling me what to do, is lost on you. As are many things.

Brian"Do you ev... (Below threshold)
retired military:

Brian

"Do you even comprehend who is guaranteeing what? US Govt. is promising to pay for all defects of GM products.

Yes, IF GM CAN'T.

"

So what makes you think GM will pay for anything when they know that if they dont that the US GOVT will pick up the tab? If you think they wont try to get out of paying for the warranties and letting US as in the taxpayer pick them up then you should put down the crack pipe.

"My point is that it would be just as idiotic to come on here with "Obama must be great" every time the market has a good day as it was for #24 to gloat that today the market had a bad day."

Hey every time gas prices went up you by a penny or 2 you saw the press talk about gas prices soaring to make Bush look bad. See how that goose gander thing works. THe liberals are hating it now and saying we are being unfair to Obama when we are treating him (actually much ) like the libs treated Bush. At least the conservatives havent accused Obama of conspiring with aliens to destroy the world, of starting the great plague, of genocide, of mass murder, etc.


(actually much ) should re... (Below threshold)
retired military:

(actually much ) should read (actually MUCH BETTER THAN)

Waggoner's dismissal aside,... (Below threshold)
James H:

Waggoner's dismissal aside, I think Obama's pushing the issue in the right direction -- toward a managed bankruptcy of some sort.

That said, I'd rather see the companies' woes go before a bankruptcy court insulated from politics. Putting the automakers under the White House's thumb invites DC to meddle too far in the businesses.

James H.Dont you t... (Below threshold)
retired milirary:

James H.

Dont you think it would have been better for them to go bankrupt prior to sucking down about $30 billion (or however much it is was) of taxpayer money?

RM #59,You are so ... (Below threshold)
Tim:

RM #59,

You are so right. Back at the start of this, people would say "we can't let them fail". Newsflash - they already have. They've lost $30 Billion in one year, on top of God knows how many more in the previous years. If that's not a failed company, I don't know what is. Now we're just propping up a corpse.

Retired mil:To be ... (Below threshold)
James H:

Retired mil:

To be honest, I'm conflicted on the issue. On the one hand, letting the automakers go down the tubes could have had (and could still have) an awful ripple effect on the economy. On the other hand, I don't think meddling in the market should be a last-resort policy for the feds, and even then the meddling should be brief.

Was the money spent earlier a waste? I can't honestly say yes or no to that question. However, I think I can live with that expenditure. The money came with a requirement that the automakers commit themselves to their long-term survival. Bailing out the automakers I don't care for, but giving them room to breathe I could deal with.

Obama's pushing mergers and chapter 11 right now, I think, because the automakers didn't present realistic plans for long-term survival. If the feds are spending money to ease the automakers into bankruptcy, mergers, and/or reorganization, again, I can live with it. That's more about easing the pain of the business cycle, rather than intervening wholesale.

I do think it's worth considering broader issues, though.

First, it's important that the United States maintain a certain level of manufacturing capacity. There will come a time when we have to beat our ploughshares into swords again. When we do, plants that manufacture automobiles can be retooled to manufacture military assets. We need that capacity.

Second, the WaPo notes another aspect of the auto bailout wars. By dismissing Waggoner and signaling that he's willing to allow Chrysler and GM to die, Obama's sent a strong message to the banks: The taxpayers' largesse is not infinite.

Great. Now thanks to Obama... (Below threshold)
_Mike_:

Great. Now thanks to Obama, you can go to the DMV for your driver's license, to have your car repaired, and next up - for your healthcare. (Considering the expected wait time - housing might be offered too!).

Mike, don't forget you can ... (Below threshold)
Tim:

Mike, don't forget you can also register to vote at the DMV, and if ACORN gets it's way, you'll be able to vote for Democrats there too.

James H"Obama's pu... (Below threshold)
retired military:

James H

"Obama's pushing mergers and chapter 11 right now, I think, because the automakers didn't present realistic plans for long-term survival. "

That wont come about without the UAW giving up their golden goose and they wont. Instead taxpayers will most likely have to take over paying for it.

No business in America is "TOO BIG TO FAIL". if that is true we might as well just lock the doors and throw away the key.

If DC were nuked and the Pres, VP, Congress and Supreme court were wiped out would we just throw our hands up in the air and surrender. (Cheer maybe but not surrender). We would struggle, fight, survive and carry on. We may look differnt on the other side but we would carry on.

If a meteor hit detroit and wiped out the hq for GM , FORD, and CHrsyler would the US just give up and say "Hey that's it. The big 3 cant make cars anymore"

Of course not.

When one business fails there are other businesses there ready to take advanatge of it. They will pick up the pieces that work, throw away what doesnt and get bigger as a result. That is the law of supply and demand. Just because one of the suppliers goes out of business doesnt lessen the demand.

IF GM is forced to manuafacture hybrids guess what will happen.

A. Fewer folks will buy GM.

B. Ford, and others who are making what customers want will make more money.

The only way for the govt to force this business model to work is to adversely affect what customers naturally want (which isnt "green" clown cars). That is going to cost consumers freedom of choice and money. Then people will go overseas to buy cars. Govt raises import tariffs to put cut off that avenue. Thus less freedom of choice and higher cost to the consumer.

These are easy concepts to understand but far be it from us to expect the govt to give the public more freedom and lower costs.

Hey every time gas price... (Below threshold)
Brian:

Hey every time gas prices went up you by a penny or 2 you saw the press talk about gas prices soaring to make Bush look bad. See how that goose gander thing works.

You mean like when the right tried blaming the increase on Pelosi and the Democratic Congress?

By the way, "Wall Street set for best month in 6 years", so "Obambi" must not be all that bad, eh?

Brian"You mean lik... (Below threshold)
retired milirary:

Brian

"You mean like when the right tried blaming the increase on Pelosi and the Democratic Congress?"

Yep and the MSM was still blaming Bush even though democrats were restricting supply which causes prices to rise. Sorta like they are doing now.

Yep Bri, quadrupling our 20... (Below threshold)
419:

Yep Bri, quadrupling our 200 year national debt in 2 months is so encouraging to investors.

Congress and thus pelosi appropriate the money for this wastefulness so yeah, You and Her are to blame.




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