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February 9th, 2009
12:26 PM ET

Financial Dispatch: Stimulus road show

Nissan is planning to slash its global production by 20 percent.

Nissan is planning to slash its global production by 20 percent.

Andrew Torgan
CNN Financial News Producer

President Obama visits Elkhart, Indiana today for a town hall-style event designed to help push his stimulus package through Congress. The unemployment rate in Elkhart has jumped to 15.3% from 4.7% in just the past year due to a loss of manufacturing jobs. And on Tuesday he travels to Fort Myers, Florida, where the unemployment rate is 10%. He’ll also hold his first primetime news conference tonight at 8:00 p.m.

A compromise version of the economic recovery plan is likely to pass the Senate with a handful of Republican votes as early as Tuesday, but a final bill is still a ways off. If the Senate passes the bill, leaders will need to then negotiate the final bill with the House, which passed a different version nearly two weeks ago.

CNNMoney.com has several stories about the debate, including how the two versions differ and what provisions got cut in the Senate.

The "massive overhaul" of the $700 billion banking bailout plan will be announced one day later than expected. Treasury Secretary Timothy Geithner was originally scheduled to give full details about the changes to the rescue plan in a speech today. But the Treasury Department said Sunday that the plan will be announced Tuesday instead, in order for Geithner to focus on the stimulus bill that is being debated in the Senate.

Nissan, Japan's third-largest automaker, says it will cut its workforce by 20,000. The company also said it’s eliminating bonuses for its board of directors. And until its financial situation improves, it’s reducing board members' salaries by 10%.

General Motors is said to be is in talks to take back large portions of Delphi Corp., the auto parts supplier it spun-off a decade ago The move is part of a strategy to qualify for additional government loans, according to The Wall Street Journal.

GM also is expected to shut down more auto-assembly plants beyond the nine closures it’s already announced.

Additionally, GM and Chrysler could be forced into bankruptcy by the government to assure repayment of $17.4 billion in federal bailout loans - a course of action the automakers claim would destroy them.

Bloomberg is reporting that if federal officials fail to get an agreement to change their place in line for repayment, they have the option to force the companies into bankruptcy as a condition of more bailout aid. Essentially, lawmakers want taxpayers to be first in line to get their money back, ahead of the companies' creditors.

Naturally, GM and Chrysler are not enthusiastic about that option, saying previously that reorganizing under Chapter 11 protection would scare away potential buyers and lead to liquidation. Neither GM nor Chrysler would comment.

Gas prices rose 3-tenths of a cent overnight to $1.924 a gallon ($1.92 for graphics). That’s the 12th consecutive increase. 8 states have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.506). 42 states and the District of Columbia have regular unleaded gas prices below $2. The cheapest gas prices are in Wyoming ($1.640)

And finally… Starbucks - the company that built it’s now-struggling empire on the idea that people will pay a premium for a gourmet cup of coffee - unveiled plans today to introduce its first “value menu.”

$3.95 will get you either a latte with oatmeal or a coffee cake, or a drip coffee with one of four hot breakfast sandwiches. Starbucks has fallen victim to the slowdown in consumer spending amid the ongoing recession. It recently announced plans to close hundreds of stores and layoff thousands of workers.


Filed under: Andrew Torgan • Economy • Finance • Gas Prices • Oil • President Barack Obama
soundoff (15 Responses)
  1. jim Fallbrook CA

    The stimulus package is nothing but pork and special interest projects from lobbyist. I believe our socialist president Barack Hussein Obama should let the banks make home loans at 3% interest. That would solve 90% of our problems. Home values would rise and it would cost less than $850 billion.

    February 10, 2009 at 12:27 am |
  2. alpacadan

    produce methane through waste diversion, sounds simple enough why don't we hear more about using CNG to fuel our cars. If we do it the correct way it could be beneficial on multiple levels and create good jobs, not to mention a carbonless footprint.

    February 9, 2009 at 7:38 pm |
  3. Annie Kate

    Its kind of silly I know but the one part of the article that really got my attention was the part on Starbucks – my teens love Starbucks. I can't believe they are getting a value menu – is this the beginning of McStarbucks?

    February 9, 2009 at 6:38 pm |
  4. Ted

    Since Obama’s earnest drive to convince the nation to weaken its economic strength through redistribution as well as weaken its national defense, COUPLED WITH HIS UNPRECEDENTED WHITE HOUSE TAKEOVER OF DECENNIAL CENSUS TAKING FROM THE COMMERCE DEPARTMENT, has confirmed the very threats to our Republic’s survival that the Constitution was designed to avert, it no longer is sustainable for the United States Supreme Court and Military Joint Chiefs to refrain from exercising WHAT IS THEIR ABSOLUTE CONSTITUTIONAL DUTY TO DEFEND THE NATION FROM UNLAWFUL USURPATION. The questions of Obama’s Kenyan birth and his father’s Kenyan/British citizenship (admitted on his own website) have been conflated by his sustained unwillingnes to supply his long form birth certificate now under seal, and compounded by his internet posting of a discredited ‘after-the-fact’ short form ‘certificate’. In the absence of these issues being acknowledged and addressed, IT IS MANIFEST THAT OBAMA REMAINS INELIGIBLE TO BE PRESIDENT UNDER ARTICLE 2 OF THE UNITED STATES CONSTITUTION. Being a 14th Amendment ‘citizen’ is not sufficient. A ‘President’ MUST BE an Article 2 ‘natural born citizen’ AS DEFINED BY THE FRAMERS’ INTENT.

    February 9, 2009 at 6:35 pm |
  5. Arachnae

    xtina says: "The stimulus is 10 per cent job creation and 90 per cent extra spending aka. payback from people who got Obama elected. "

    I'm not sure economic stimulus means what you think it means. Ezra Klein:

    “The American people are figuring it out,” Mr. McCain said. “This is not a stimulus bill; it is a spending bill.”

    Similarly, this is not a restaurant; it's a place that sells food in exchange for money. And this is not library; it's a facility that lends books. And this is not my mother; it's the woman who gave birth to me and later provided me with sandwiches. And this is not a guy who should be president; it's some grandstanding senator with a very poor grasp of economics!

    February 9, 2009 at 5:50 pm |
  6. marilyn orange

    I want to know why we are still playing the blame game? We the American people of the United States of America have given eight long dreadful years from the Bush's Administration to make a change for this country with no questions being asked how he spent the stimulus package. Now we have a President Obama's Administration that wants to make a change for the better but is being put on hold because of disagreements of the stimulus package? Everyone in the economy is suffering and hurt except for those people at wall street who got rewarded bonuses for their discrepancies.

    February 9, 2009 at 5:32 pm |
  7. xtina, chicago IL

    I think the free market econ. of the United States should always prevail; should always be allowed to cycle up and cycle down.Don't put the Congress in charge of more parts of the economy. After all, they are mostly politicians with agendas. Once they get that power they will not want to give it back over.

    The stimulus is 10 per cent job creation and 90 per cent extra spending aka. payback from people who got Obama elected. It's LOADED with pork barrel extras. So much for "change" in Washington.

    February 9, 2009 at 5:29 pm |
  8. jarrod

    the more they fight the more it cost in trying to sell this package i say if they can't agree let them all get what they deserve because at this point they need to be struck with poverty. How are they going to spend their IOU's because the more time wasted the less funds they will have.

    February 9, 2009 at 5:08 pm |
  9. Arachnae

    the news media has been totally missing in action on the topic of the economy, both before the crisis was clearly visible to the blind, and now, when we're standing on the edge of the abyss. I haven't seen news reporting this bad since the cheerleading during the run-up to the Iraq invasion.

    Where's the analysis of what WORKS? All I've seen is analysis of who's up and who's down, whose team is ahead, and similar sports-like coverage. Shameful dereliction of duty.

    February 9, 2009 at 5:02 pm |
  10. Esperanza Hernandez

    Here is an idea for the obstructionist senators, posturing and dilly-dallying with old, worn out ideas, and getting in the way of the stimulus package: Let's have them try to live on an unemployment check for a while...

    The mentality of pursuing "what is good for ME right now" instead the well-being of the country is abolutely repugnant.

    February 9, 2009 at 3:55 pm |
  11. Sue Filutze

    Wonder how long the MSM, including CNN will keep on carrying the GOP water. Seems evident that you people keep the GOP members front and center, about 58% of GOP members interviewed as opposed to 32% of DNC members regarding the stimulas bill.
    Maybe you didn't get the MEMO, the GOP LOST THE LAST ELECTION. President Obama has done everything possible to attempt to reach acorss the isle, however, the GOP simply want to stall, obstruct, and keep telling everyone how their "failed tax cut plans" will work everything out just fine. Maybe everyone in the media forgot about the last eight years and how we got here, but the American people didn't.
    I have an idea maybe you could try "reporting" both sides for a change, who knows maybe it will work!

    February 9, 2009 at 2:37 pm |
  12. ronvan

    Sharon VA: You hit it about car makers! In 03 I needed to buy a new Van. Wound up buying a Kia Sedona! WHY? It was $15K cheaper than any of the 3 American car dealers! It is fully loaded, has close to 80K miles, and have had NO PROBLEMS with it other than normal maintenance!! CHEAPER prices will not happen as I beleive that the OIL COMPANIES control our car makers! Even if they start to build alternative cars it will wind up being cheaper to buy an Astin Martin!
    Unions had thier time, and did help many. Now they are part of the problem!!

    February 9, 2009 at 2:14 pm |
  13. sandy edger

    why is it that no one is reporting on the census and obama's plan to move it out of commerce and move it to the white house is there any news people out there that actually report the news JOURNALISTS start doing your job and inform the american public of all aspects of politics not just the things that you want us to know

    February 9, 2009 at 1:45 pm |
  14. Sharon VA

    Well first GM and Chrysler and all the American car companies need to get rid of the Union they have, then maybe they can pay their employers a more comparison wage rather than these pumped up wages people get paid such as $35 an hour to put a bolt into a piece of metal thats it!

    So the car companies can cry me a river, I don't want to hear it! They need to desparately revamp themselves as well as start building smart cars that are Affordable!
    Which they could do if again they get rid of the Union and its pompous dues and stop overpaying employees!

    Now Obama wants to use some of the stimulus money to buy the Government smart cars and hybrids?

    I didn't realize that we as taxypayers not only pay these politicians outragious salaries but we also foot the bill for their automobiles?

    Wow, I really need to work for Congress, oh nevermind I forgot I'm not a rich person I am a working class I would never be able to get all the free perks these idiots get!

    Buy your own Freaking cars! Why should we foot the bill for their cars?
    People out here losing jobs and homes and they want us to pay for your cars? You have jobs, you make more money in one year than most working Americans make in a lifetime!

    So Obama, Congress get a grip, buy your own cars! Give that money to the people in need, those losing jobs and homes!!! HELLO!

    February 9, 2009 at 1:07 pm |
  15. xtina, chicago IL

    Obama campaigned against a higher deficit and "pork barrel spending". Now it's "urgent" ??

    February 9, 2009 at 12:48 pm |