OK, I know I said GM should be allowed to fail, but that was my immediate reflexive reaction. They should be allowed to suffer, the executives and the unions alike, but something will have to be done.
I abhor the idea that a corporation is “too big to be allowed to fail,” because it means companies are motivated to grow by any and all means — past the point of economies of scale and into inefficient bureaucracy — as sort of an insurance policy. But seeing 100,000 jobs disappear overnight, rather than maybe 25-30,000 as would be needed for a reorganization, is unacceptable.
I like an idea I heard on NPR while I was sick in bed. Let Exxon-Mobil loan the auto makers the $25 billion. Why should it be the taxpayers floating Detroit? Washington should strong-arm the oil companies. Get tough and threaten to put the CEO’s in front of a Senate panel, under oath. Start asking about price gouging, and don’t let the dramatic drop in gas and heating oil prices soften the questions about windfall profits. Why not?
And if the loan ends up coming from Washington, there better be a lot of strings attached, take it or leave it. No compromise on new mileage standards, for example.
