Shakespeare might have said, "To bailout, or not to bailout, that is the question."
On the one hand, many say the loss of jobs would cripple an already weakened economy. The ripple effect would be enormous: auto parts makers and auto dealers are the obvious; the trickle down effect is not so obvious, but towns, families, retailers, etc. would suffer.
On the other hand, many say the foreign auto producers will step into the gap left by the demise of the American auto companies, and the effect will not be such a disaster. In addition, with millions of US cars on the market, parts and service requirements will continue for many years. All we would really lose, in the long term, are the profits that the car companies might generate and keep in this country. Of course, the dislocation and relocation of factories and thousands of people would be harsh.
Lastly, is $25 billion dollars enough or will the car people be back for more? At the rate they are burning cash, probably the latter.
So here is a new thought.
Rather than loan or invest these billions in Ford, GM and Chrysler, why not quickly nationalize them, removing management, installing new people, new energy, new thinking, a new model for doing business, and possibly even new pay rates and insurance and retirement plans, and get on with the job. Bring in a Bill Gates or Steve Jobs, or one of hundreds more innovative thinkers to lead the charge. Use the $25 billion to create new, trim, companies rather than propping up old stale ones. Along that line, fire the entire core of lobbyist, especially those who fight against higher fuel efficiency standards.
On that last line of thinking, could the car company disaster be similar to the financial disaster have been caused by deregulation (i.e. low fuel efficiency standards?)
Your comments are invited.
