Another Opinion About A Bailout for the Detroit 3
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Another Opinion About A Bailout for the Detroit 3
As President-elect Barack Obama prepares to enter the White House, he must ponder what to do about the world's trouble spots: Iran, Iraq, North Korea. And, oh yes, Detroit. Paul Ingrassia, a former Dow Jones executive and Detroit bureau chief for the Wall Street Journal has some suggestions.
First, if GM is too big to fail, it's also too big to be entrusted to the same people who have led it to its current, perilous state. In return for any direct government aid, the board and the management should go, and a government-appointed receiver should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible.
As for Ford and Chrysler, if they want similar public assistance they should pay the same price. Government loan guarantees, with stringent strings attached and new management at the helm, helped save Chrysler in 1980. But it's now 2008, 35 years since the first oil shock put Japanese cars on the map in America.
"Since the mid-Seventies," one Detroit manager recently told Ingrassia, "I have sat through umpteen meetings describing how we had to beat the Japanese to survive. Thirty-five years later we are still trying to figure it out." Which is why pouring taxpayer billions into the same old dysfunctional morass isn't the answer”.
Detroit Auto Makers Need More Than a Bailout By PAUL INGRASSIA
LINK: http://online.wsj.com/article/SB122628230122212449.html
First, if GM is too big to fail, it's also too big to be entrusted to the same people who have led it to its current, perilous state. In return for any direct government aid, the board and the management should go, and a government-appointed receiver should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible.
As for Ford and Chrysler, if they want similar public assistance they should pay the same price. Government loan guarantees, with stringent strings attached and new management at the helm, helped save Chrysler in 1980. But it's now 2008, 35 years since the first oil shock put Japanese cars on the map in America.
"Since the mid-Seventies," one Detroit manager recently told Ingrassia, "I have sat through umpteen meetings describing how we had to beat the Japanese to survive. Thirty-five years later we are still trying to figure it out." Which is why pouring taxpayer billions into the same old dysfunctional morass isn't the answer”.
Detroit Auto Makers Need More Than a Bailout By PAUL INGRASSIA
LINK: http://online.wsj.com/article/SB122628230122212449.html
As President-elect Barack Obama prepares to enter the White House, he must ponder what to do about the world's trouble spots: Iran, Iraq, North Korea, the Caucasus. And, oh yes, Detroit.
On Friday, General Motors and Ford announced more multibillion-dollar losses in the third quarter; closely held Chrysler doesn't publicly report results. When GM, which seems in the worst shape, was 45 minutes late releasing its results, rumors spread that a bankruptcy filing was imminent. It wasn't, but the company says it could run out of cash in the first half of next year. Make that the first quarter if the current cash bleed continues. GM is lobbying furiously for emergency federal assistance, with Ford and Chrysler close behind.
Let's assume that the powers in Washington -- the Bush team now, the Obama team soon -- deem GM too big to let fail. If so, it's also too big to be entrusted to the same people who have led it to its current, perilous state, and who are too tied to the past to create a different future.
In return for any direct government aid, the board and the management should go. Shareholders should lose their paltry remaining equity. And a government-appointed receiver -- someone hard-nosed and nonpolitical -- should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible.
That will mean tearing up existing contracts with unions, dealers and suppliers, closing some operations and selling others, and downsizing the company. After all that, the company can float new shares, with taxpayers getting some of the benefits. The same basic rules should apply to Ford and Chrysler.
These are radical steps, and they wouldn't avoid significant job losses. But there isn't much alternative besides simply letting GM collapse, which isn't politically viable. At least a government-appointed receiver would help assure car buyers that GM will be around, in some form, to honor warranties on its vehicles. It would help minimize losses to the government's Pension Benefit Guaranty Corp.
But giving GM a blank check -- which the company and the United Auto Workers union badly want, and which Washington will be tempted to grant -- would be an enormous mistake. The company would just burn through the money and come back for more. Even more jobs would be wiped out in the end.
The current economic crisis didn't cause the meltdown in Detroit. The car companies started losing billions of dollars several years ago when the economy was healthy and car sales stood at near-record levels. They complained that they were unfairly stuck with enormous "legacy costs," but those didn't just happen. For decades, the United Auto Workers union stoutly defended gold-plated medical benefits that virtually no one else had. UAW workers and retirees had no deductibles, copays or other facts of life in these United States.
A few years ago the UAW even waged a spirited fight to protect the "right" of workers to smoke on the assembly line, something that simply isn't allowed at, say, Honda's U.S. factories. Aside from the obvious health risk, what about cigarette ashes falling onto those fine leather seats being bolted into the cars? Why was this even an issue?
When GM's bond ratings plunged into junk territory a couple years ago the auto maker sold 51% of its financing arm, GMAC, to Cerberus, a private-equity powerhouse. Then last summer Cerberus bought 80% of Chrysler from Daimler for just 25% of what the German company paid for the company a decade earlier. It looked like a great deal at the time, like buying a "fixer upper" house at a steep discount. Until, that is, you have to shell out big bucks to shore up the foundation, repair the leaky roof, etc.
Cerberus tried hard in recent weeks to sell Chrysler to GM, with government financial assistance. Controlling GMAC's lending to GM dealers and customers gave Cerberus enormous leverage at the negotiating table. Cerberus squeezed hard, say industry analysts and insiders, but the GM board balked. Last Friday the companies said the talks were off -- "for the moment," as the company's chief operating officer put it.
For the moment? How about, like, forever? Buying Chrysler would just give GM an excuse to delay the fundamental task of putting its house in order. Management would turn its energy to producing pretty PowerPoint slides with all the requisite buzzwords: synergies, transformation, downsizing, rightsizing and exercising. What's needed, instead, is exorcising.
A thorough housecleaning at GM is the only way to give the company a fresh start. GM is structured for its glory days of the 1960s, when it had half the U.S. car market -- not for the first decade of this century, when it has just over 20% of the market. General Motors simply cannot support eight domestic brands (Cadillac, Buick, Pontiac, Chevrolet, GMC, Saturn, Saab and Hummer) with adequate product-development and marketing dollars. Even the good vehicles the company develops (for example, the Cadillac CTS and Chevy Malibu) get lost in the wash.
Nevertheless, the current board of directors and management have stuck stubbornly to this structure. The lone exception was a dissident director, Jerome B. York, who resigned a couple years ago. He warned that without fundamental changes the "unthinkable" might happen to GM. Well, here we are.
Which brings us back to what the government should do. If public dollars are the only way to keep General Motors afloat, as the company contends, a complete restructuring under a government overseer or oversight board has to be the price.
That is essentially the role played by the federal Air Transportation Stabilization Board in doling out taxpayer dollars to the airlines in the wake of 9/11. The board consisted of senior government officials with a staff recruited largely from the private sector. It was no figurehead. When one airline brought in a lengthy, convoluted restructuring plan, a board official ordered it to come back with something simpler and sustainable. The Stabilization Board did its job -- selling government-guaranteed airline loans and warrants to private investors, monitoring airline bankruptcies to protect the interests of taxpayers -- and even returned money to the government.
As for Ford and Chrysler, if they want similar public assistance they should pay the same price. Wiping out existing shareholders would end the Ford family's control of Ford Motor. But keeping the family in the driver's seat wouldn't be an appropriate use of tax dollars. Nor is bailing out the principals of Cerberus, who include CEO Stephen Feinberg, Chairman John Snow, the former Treasury secretary, and global investing chief Dan Quayle, former vice president.
Government loan guarantees, with stringent strings attached and new management at the helm, helped save Chrysler in 1980. But it's now 2008, 35 years since the first oil shock put Japanese cars on the map in America. "Since the mid-Seventies," one Detroit manager recently told me, "I have sat through umpteen meetings describing how we had to beat the Japanese to survive. Thirty-five years later we are still trying to figure it out."
Which is why pouring taxpayer billions into the same old dysfunctional morass isn't the answer.
Mr. Ingrassia is a former Dow Jones executive and Detroit bureau chief for this newspaper.
On Friday, General Motors and Ford announced more multibillion-dollar losses in the third quarter; closely held Chrysler doesn't publicly report results. When GM, which seems in the worst shape, was 45 minutes late releasing its results, rumors spread that a bankruptcy filing was imminent. It wasn't, but the company says it could run out of cash in the first half of next year. Make that the first quarter if the current cash bleed continues. GM is lobbying furiously for emergency federal assistance, with Ford and Chrysler close behind.
Let's assume that the powers in Washington -- the Bush team now, the Obama team soon -- deem GM too big to let fail. If so, it's also too big to be entrusted to the same people who have led it to its current, perilous state, and who are too tied to the past to create a different future.
In return for any direct government aid, the board and the management should go. Shareholders should lose their paltry remaining equity. And a government-appointed receiver -- someone hard-nosed and nonpolitical -- should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible.
That will mean tearing up existing contracts with unions, dealers and suppliers, closing some operations and selling others, and downsizing the company. After all that, the company can float new shares, with taxpayers getting some of the benefits. The same basic rules should apply to Ford and Chrysler.
These are radical steps, and they wouldn't avoid significant job losses. But there isn't much alternative besides simply letting GM collapse, which isn't politically viable. At least a government-appointed receiver would help assure car buyers that GM will be around, in some form, to honor warranties on its vehicles. It would help minimize losses to the government's Pension Benefit Guaranty Corp.
But giving GM a blank check -- which the company and the United Auto Workers union badly want, and which Washington will be tempted to grant -- would be an enormous mistake. The company would just burn through the money and come back for more. Even more jobs would be wiped out in the end.
The current economic crisis didn't cause the meltdown in Detroit. The car companies started losing billions of dollars several years ago when the economy was healthy and car sales stood at near-record levels. They complained that they were unfairly stuck with enormous "legacy costs," but those didn't just happen. For decades, the United Auto Workers union stoutly defended gold-plated medical benefits that virtually no one else had. UAW workers and retirees had no deductibles, copays or other facts of life in these United States.
A few years ago the UAW even waged a spirited fight to protect the "right" of workers to smoke on the assembly line, something that simply isn't allowed at, say, Honda's U.S. factories. Aside from the obvious health risk, what about cigarette ashes falling onto those fine leather seats being bolted into the cars? Why was this even an issue?
When GM's bond ratings plunged into junk territory a couple years ago the auto maker sold 51% of its financing arm, GMAC, to Cerberus, a private-equity powerhouse. Then last summer Cerberus bought 80% of Chrysler from Daimler for just 25% of what the German company paid for the company a decade earlier. It looked like a great deal at the time, like buying a "fixer upper" house at a steep discount. Until, that is, you have to shell out big bucks to shore up the foundation, repair the leaky roof, etc.
Cerberus tried hard in recent weeks to sell Chrysler to GM, with government financial assistance. Controlling GMAC's lending to GM dealers and customers gave Cerberus enormous leverage at the negotiating table. Cerberus squeezed hard, say industry analysts and insiders, but the GM board balked. Last Friday the companies said the talks were off -- "for the moment," as the company's chief operating officer put it.
For the moment? How about, like, forever? Buying Chrysler would just give GM an excuse to delay the fundamental task of putting its house in order. Management would turn its energy to producing pretty PowerPoint slides with all the requisite buzzwords: synergies, transformation, downsizing, rightsizing and exercising. What's needed, instead, is exorcising.
A thorough housecleaning at GM is the only way to give the company a fresh start. GM is structured for its glory days of the 1960s, when it had half the U.S. car market -- not for the first decade of this century, when it has just over 20% of the market. General Motors simply cannot support eight domestic brands (Cadillac, Buick, Pontiac, Chevrolet, GMC, Saturn, Saab and Hummer) with adequate product-development and marketing dollars. Even the good vehicles the company develops (for example, the Cadillac CTS and Chevy Malibu) get lost in the wash.
Nevertheless, the current board of directors and management have stuck stubbornly to this structure. The lone exception was a dissident director, Jerome B. York, who resigned a couple years ago. He warned that without fundamental changes the "unthinkable" might happen to GM. Well, here we are.
Which brings us back to what the government should do. If public dollars are the only way to keep General Motors afloat, as the company contends, a complete restructuring under a government overseer or oversight board has to be the price.
That is essentially the role played by the federal Air Transportation Stabilization Board in doling out taxpayer dollars to the airlines in the wake of 9/11. The board consisted of senior government officials with a staff recruited largely from the private sector. It was no figurehead. When one airline brought in a lengthy, convoluted restructuring plan, a board official ordered it to come back with something simpler and sustainable. The Stabilization Board did its job -- selling government-guaranteed airline loans and warrants to private investors, monitoring airline bankruptcies to protect the interests of taxpayers -- and even returned money to the government.
As for Ford and Chrysler, if they want similar public assistance they should pay the same price. Wiping out existing shareholders would end the Ford family's control of Ford Motor. But keeping the family in the driver's seat wouldn't be an appropriate use of tax dollars. Nor is bailing out the principals of Cerberus, who include CEO Stephen Feinberg, Chairman John Snow, the former Treasury secretary, and global investing chief Dan Quayle, former vice president.
Government loan guarantees, with stringent strings attached and new management at the helm, helped save Chrysler in 1980. But it's now 2008, 35 years since the first oil shock put Japanese cars on the map in America. "Since the mid-Seventies," one Detroit manager recently told me, "I have sat through umpteen meetings describing how we had to beat the Japanese to survive. Thirty-five years later we are still trying to figure it out."
Which is why pouring taxpayer billions into the same old dysfunctional morass isn't the answer.
Mr. Ingrassia is a former Dow Jones executive and Detroit bureau chief for this newspaper.
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First, if GM is too big to fail, it's also too big to be entrusted to the same people who have led it to its current, perilous state. In return for any direct government aid, the board and the management should go, and a government-appointed receiver should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible.
AIG was/is supposedly too big to fail and I don't believe any such strings were attached to that deal. Not too mention they got even more money over the weekend.
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Once the Pandora's box of "free" government money is opened how do you close it (that's assuming the current/forthcoming administration even wanted to do so which they obviously don't)?
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It's kinda like that old saying: "if you owe the bank $1,000 and can't pay, you have a problem. If you owe the bank $100,000,000 and can't pay, the bank has a problem"
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Given Carlos Ghosn was a Renault man in charge of cleaning up a terminally ill car company... one that nobody wanted (Nissan)... who would it take to clean up GM's current mess? Surely it would have to be an automotive person or a board of former/current automotive executives with a sharp knife? Alan Mullaly isn't exactly doing wonders for Ford... so would a new person at the helm (and his board) be the tonic needed? I wonder if the GM landscape is far different to the one where Ghosn cut through Nissan e.g. UAW, VEBA, etc...?
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I don't see the alternative. GM's current bosses have shown no willingness or ability to restructure themselves into a profitable business. Given that they will be bailed out, someone with a plan is going to have to take over.
We taxpayers own 80% of AIG, and the company is being effectively dismantled in an orderly fashion.
AIG was/is supposedly too big to fail and I don't believe any such strings were attached to that deal. Not too mention they got even more money over the weekend.
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current management, bob lutz aside, has not done enough to focus on cars, cancelling valuable car programs like the zeta cars, delaying cavalier replacements earlier in the decade, and now pushing back epsilon replacements. GM has never had thier act together on cars, focusing instead on short term gain in the form of truck profits, where did that order come from? Direct from the top.
more cars, better designed cars are what GM needs now, all that it can take. if an impala zeta would be ready for mid year release next year, no it wouldn't have a huge impact on bottom line or sales statistics given current economic conditions, but it would provide a huge morale boost and if visible enough it could serve as a message to consumers and the country at large that they were getting thier act together.
instead GM wastes the resources it spent on retooling a factory in Canada, as well as the money spent developing the changes for the American Zeta cars. Cadillac needs a large sedan to complement the mid-line CTS, it's a big mistake to assume large luxury sedan buyers suddenly will disappear.
Classic GM stupidity. the thing is I could, along with many others here, sit here typing a long list of miscalculations, bad judgement calls, poor execution, and just downright stupidity/bungling....the management has got to go.
If GM gets bailed out, management, Bob Lutz aside, has to go, along with the board. analysts and investors know why GM has failed, and it has nothing to do with poor economic climate conditions.
Bad economic conditions brought the end faster......but the Titanic has been sinking for a long long time. It is time to get rid of those people who do not have anything to do with nurturing a coherent product line of automobiles people can buy.
more cars, better designed cars are what GM needs now, all that it can take. if an impala zeta would be ready for mid year release next year, no it wouldn't have a huge impact on bottom line or sales statistics given current economic conditions, but it would provide a huge morale boost and if visible enough it could serve as a message to consumers and the country at large that they were getting thier act together.
instead GM wastes the resources it spent on retooling a factory in Canada, as well as the money spent developing the changes for the American Zeta cars. Cadillac needs a large sedan to complement the mid-line CTS, it's a big mistake to assume large luxury sedan buyers suddenly will disappear.
Classic GM stupidity. the thing is I could, along with many others here, sit here typing a long list of miscalculations, bad judgement calls, poor execution, and just downright stupidity/bungling....the management has got to go.
If GM gets bailed out, management, Bob Lutz aside, has to go, along with the board. analysts and investors know why GM has failed, and it has nothing to do with poor economic climate conditions.
Bad economic conditions brought the end faster......but the Titanic has been sinking for a long long time. It is time to get rid of those people who do not have anything to do with nurturing a coherent product line of automobiles people can buy.
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current management, bob lutz aside, has not done enough to focus on cars, cancelling valuable car programs like the zeta cars, delaying cavalier replacements earlier in the decade, and now pushing back epsilon replacements. GM has never had thier act together on cars, focusing instead on short term gain in the form of truck profits, where did that order come from? Direct from the top.
more cars, better designed cars are what GM needs now, all that it can take. if an impala zeta would be ready for mid year release next year, no it wouldn't have a huge impact on bottom line or sales statistics given current economic conditions, but it would provide a huge morale boost and if visible enough it could serve as a message to consumers and the country at large that they were getting thier act together.
instead GM wastes the resources it spent on retooling a factory in Canada, as well as the money spent developing the changes for the American Zeta cars. Cadillac needs a large sedan to complement the mid-line CTS, it's a big mistake to assume large luxury sedan buyers suddenly will disappear.
Classic GM stupidity. the thing is I could, along with many others here, sit here typing a long list of miscalculations, bad judgement calls, poor execution, and just downright stupidity/bungling....the management has got to go.
If GM gets bailed out, management, Bob Lutz aside, has to go, along with the board. analysts and investors know why GM has failed, and it has nothing to do with poor economic climate conditions.
Bad economic conditions brought the end faster......but the Titanic has been sinking for a long long time. It is time to get rid of those people who do not have anything to do with nurturing a coherent product line of automobiles people can buy.
more cars, better designed cars are what GM needs now, all that it can take. if an impala zeta would be ready for mid year release next year, no it wouldn't have a huge impact on bottom line or sales statistics given current economic conditions, but it would provide a huge morale boost and if visible enough it could serve as a message to consumers and the country at large that they were getting thier act together.
instead GM wastes the resources it spent on retooling a factory in Canada, as well as the money spent developing the changes for the American Zeta cars. Cadillac needs a large sedan to complement the mid-line CTS, it's a big mistake to assume large luxury sedan buyers suddenly will disappear.
Classic GM stupidity. the thing is I could, along with many others here, sit here typing a long list of miscalculations, bad judgement calls, poor execution, and just downright stupidity/bungling....the management has got to go.
If GM gets bailed out, management, Bob Lutz aside, has to go, along with the board. analysts and investors know why GM has failed, and it has nothing to do with poor economic climate conditions.
Bad economic conditions brought the end faster......but the Titanic has been sinking for a long long time. It is time to get rid of those people who do not have anything to do with nurturing a coherent product line of automobiles people can buy.
NEWS FLASH: GM IS FAILING BECAUSE THEY SUCK AT MAKING CARS PEOPLE WANT TO BUY!
Should I, the taxpayer, agree to bail them out with money from my wages if there is no fundamental change in how they run thier business? I've never gone to business school, never gone to car design school, never gone to engineering school, but I can assure you, I would consult them on how to make the perfect cars, for each genre.
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Addendum:
NEWS FLASH: GM IS FAILING BECAUSE THEY SUCK AT MAKING CARS PEOPLE WANT TO BUY!
Should I, the taxpayer, agree to bail them out with money from my wages if there is no fundamental change in how they run thier business? I've never gone to business school, never gone to car design school, never gone to engineering school, but I can assure you, I would consult them on how to make the perfect cars, for each genre.
NEWS FLASH: GM IS FAILING BECAUSE THEY SUCK AT MAKING CARS PEOPLE WANT TO BUY!
Should I, the taxpayer, agree to bail them out with money from my wages if there is no fundamental change in how they run thier business? I've never gone to business school, never gone to car design school, never gone to engineering school, but I can assure you, I would consult them on how to make the perfect cars, for each genre.
In regards to tax payer's rights... well the govt has misused tax payer funds non-sparingly lately... that makes the bailout of the automakers a spit in the ocean by comparison.
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That's why I'm thinking bankruptcy would be their best option right now. I'm no lawyer and tell me if I'm talking gobble-de-****, but all the facts and details are laid out before a court of law.
In regards to tax payer's rights... well the govt has misused tax payer funds non-sparingly lately... that makes the bailout of the automakers a spit in the ocean by comparison.
In regards to tax payer's rights... well the govt has misused tax payer funds non-sparingly lately... that makes the bailout of the automakers a spit in the ocean by comparison.
The government pushed for bad loans to be made in housing. This started back in the early 1990's... And by pushed, I'm mean threats aimed at lending institutions. Fannie Mae started pushing for crap paper being issued and guaranteed.
As a result housing prices ballooned far beyond reality, too few could make the payments they couldn't afford to begin with. Housing demand hit a brick wall. Housing values plummet as a result and will drop until a realistic value is reached.
A preponderance of the loans issued demanded little or no equity from the barrower. Many even were issued above the property values... making a bad loan into a VERY BAD loan.
These bad loans were packaged, traded around and around. Under the impression that they were worth something rather than being toxic.
Now lending institutions have swung completly in the opposite direction. They are only lending to the absolute most golden prospects. THIS is why the domestics are in the jam they are in. People want to buy but they can't get a loan.
Granted, many potential buyers are sitting and buying nothing as fear tends to paralyze folks. Losing 30% of your 401K or liquid portfolio gets people thinking the bad times might get worse. I'll guess this Christmas buying season will be grim for retailers other than perhaps, Walmart. Walmart has become a foreign goods outlet. Not that much good for the home economy when Wally does well. Many retailers will perhaps be gone after January.
None of the politicians who really created this banking deal will suffer. Most have been re-elected. None of the culprits will do 1 minute in the slammer.
A look at the foreign investment percentages in government treasury bills and other instruments will give a better indication of where foreign policy and trade legislation will continue.
Letting any of the big three go down is, in my opinion, far costlier for the taxpayer than a loan several times the size being requested.
An entitlment freindly party is running the show now. They certainly risk adding a whole lot more folks to the 'dole'. Any that think the pain will be strictly in Michigan are going to be sadly mistaken. Any that presume that the european and asian manufacturers will step in and employ those that support the domestic makers are, quite frankly, nuts. The importers and transplants will not unleverage their cost advantages through some altrustic fervor.. China and India will still be happy to supply labor at rate which would be below welfare qualification levels here.
Last edited by 1fastdog; Nov 11, 2008 at 10:10 AM.
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There is NO amount of money that is going to fix GM's (or Ford's or Chrysler's) problems...NONE...the problems are systemic. Giving Detroit money is trying to put a band-aid on a severed leg.
Even if money was the answer; the Federal government doesn't have it.
Were they actually giving back money to Detroit out of a surplus of tax revenues that might be a different story but as long as they have to borrow it (from China and other foreign interests); giving money to Detroit is stupidity on top of stupidity. Also, those foreign investors who have been buying U.S. debt aren't quite so willing to do so now, at least not at favorable rates so not only does the Feds have to borrow money for the bailouts but they have to pay more to do so.
However, I've no doubt Obama and company will step right in (perhaps right into it) and when it doesn't work, they'll pony up more money (after all, government money seems to be the solution to every problem today).
If GM, Ford and/or Chrysler can’t compete then they need to go under…it’s really that simple. I don’t want to see them go under but I didn’t cause their problems…they did.
With great opportunity comes great risk; that’s what living in a free market economy is supposed to be about.
Even if money was the answer; the Federal government doesn't have it.
Were they actually giving back money to Detroit out of a surplus of tax revenues that might be a different story but as long as they have to borrow it (from China and other foreign interests); giving money to Detroit is stupidity on top of stupidity. Also, those foreign investors who have been buying U.S. debt aren't quite so willing to do so now, at least not at favorable rates so not only does the Feds have to borrow money for the bailouts but they have to pay more to do so.
However, I've no doubt Obama and company will step right in (perhaps right into it) and when it doesn't work, they'll pony up more money (after all, government money seems to be the solution to every problem today).
If GM, Ford and/or Chrysler can’t compete then they need to go under…it’s really that simple. I don’t want to see them go under but I didn’t cause their problems…they did.
With great opportunity comes great risk; that’s what living in a free market economy is supposed to be about.
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Most of us will recognize these factors are not entirely the reasons for the failure of the big three, but calling it a free market is a true misnomer.
