In Defense of Bailout Inconsistency
The Obama administration's auto bailout plan that both Senator Santorum and Governor Romney rightly opposed is clearly an example of unjustified, dangerous, and (despite all the hoopla from the media regarding its supposed "success") counterproductive and wasteful government action. Proponents of the plan argue that without the government bailout, tens of thousands of GM and Chrysler workers would have lost their jobs, and thousands more employed by suppliers to the automakers would have lost theirs, too. Instead, all these jobs were saved, GM is now profitable, and the cost to taxpayers is minimal. The problem with this justification is that it is wrong on every point. The government bailout did not prevent GM and Chrysler from going into bankruptcy. And just as if they had gone into bankruptcy without the government plan, GM and Chrysler continued to operate while they reorganized. The essence of the bailout plan was not "saving jobs" or a portion of the dwindling U.S. manufacturing base,Fremont Insurance Co. Ratings Upgraded; Auto Club Group Affirmed
A.M. Best Co. has upgraded the financial strength rating (FSR) to A (Excellent) from A- (Excellent) and issuer credit rating (ICR) to “a” from “a-” of Fremont Insurance Co. (Fremont) of Fremont, Mich. In addition, A.M. Best has affirmed the FSR of A (Excellent) and ICRs of “a” of The Auto Club Group, Dearborn, Mich. and its property/casualty members.
The outlook for all ratings is negative.
The upgrading of the ratings for Fremont is based upon it becoming part of The Auto Club Group’s existing reinsurance pooling agreement as of Jan. 1, 2012, following its acquisition by The Auto Club Group on Aug. 1, 2011.
The negative outlook is based upon the deterioration in The Auto Club Group’s operating earnings in recent years, which was driven by unfavorable underwriting results caused by homeowners’ weather-related losses and medical inflation on auto personal injury claims.
The Auto Club Group’s ratings reflect its strong risk-adjusted capitalization, modest five-year operating performance and well-established position as a personal lines market leader in Michigan, as well as the benefits derived from offering insurance products to AAA members.
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