So the Big Three CEO’s will give up their paychecks. That’s great. Take a page from Lee Iacocca’s playbook. Now, take another play from Lee’s playbook. Show us more than selling off the jets. How about…
- Ford staying home, unless they’re just lending GM and Chrysler moral support. Come on, guys. You admit you’re fully funded through 2011. And you want 36% of the bailout funds? Get real!
- GM shuttering a few brands. I’m thinking Buick, Hummer, Saturn, GMC. Let Chevy build the trucks, Pontiac the sportscars, and Cadillac the overpriced luxury models. Do we really need Hummers anymore with $4/gallon gas coming back sooner or later? GMC? Why have GMC when you’re just slapping “Chevrolet” on some of the trucks? Buicks? The Mercury and Plymouth of GM? Ditch it. And Saturn? It’s a different kind of Studebaker.
- Chrysler finding someone to eventually buy it out once it’s profitable again. And this time, just say no to Daimler Benz. I mean seriously, Benz. You guys got off too easy for screwing the pooch. You need to pay. And the German government should simply stand by and watch (and maybe laugh).
- And speaking of Chrysler, there’s another nameplate that needs to go away, or at least go dark for awhile. People buy Jeeps and Dodges, and I’m half-tempted to suggest they build only Jeeps. Ditto, Ford, for Mercury. What’s a Mercury? A cheap Lincoln or an overpriced Ford? It’s not a real car, just someone else’s rebranded stuff.
- Electric, electric, electric. It’s feasible. The technology is already here. You run your laptop off of it. And unlike Europe’s diesel obsession, it doesn’t make a bad problem worse. Even if coal plants stay online and expand at current rates for another two decades, it still pumps less crap into the air to charge up New York City’s cars than filling them all with gas or diesel would. Yes, it has its own problems, but damn if they aren’t infinitely more manageable than burning noxious chemicals supplied by nations who pretty much hate everyone they sell to.
- Fire Richard Wagoner. Look, dude, if you wrap my car around a tree, not only am I not going to let you drive it again, I’m not legally allowed to. Why? You’d lose your license. You wrapped GM around a tree, Dick. Time to give the keys to someone who can drive.
- Since all three of you are coming to Congress with your hand out, you should be federally mandated to spend a much larger percentage of your operating budgets on R&D. In fact, here’s a start for you for free. See all those cars Toyota, Honda, and BMW are building? Notice they sell pretty well? Good. Now go build something like that. My Lincoln should handle like a 3 series. My Jeep should get better gas mileage than the Neon I drive now. I should be able to plug in my Chevy at night and only have to gas up on long trips. That’s what I want.
- And if you fall on your ass after getting bailed out, take your medicine and go the way of the Studebaker and the AMC Pacer. By the time you manage to screw up your lifeline, most of the foreclosed houses will be snapped up by bargain hunters anyway, and the economy will be back on track.
As for everyone else with their hand out, tell the airlines and record industry and the technology companies to suck it up. Hey, eventually, Wal-Mart’s going to fail. But at least it won’t take the rest of the country down with it. Unlike the Big Three, Delta and Microsoft and Wal-Mart aren’t single points of failure for the rest of the economy. Somehow, we need to make the Big Three that way, too.
UPDATE: Here’s an alternate take. And Sam’s views haven’t really changed much from when this was originally posted.
People fear Congress will reward Detroit’s piss poor business acumen will trigger an avalanche of other industries looking for a handout. Rightly so. I don’t support any bailouts lightly. As I said yesterday, I’d love it if the nation could afford to tell General Motors to shut up and take its medicine, but it can’t.
However, the question remains: Where will it end?
I think Detroit is a good place to end it. The centerpiece of our industrial base is in trouble, and $25 billion is a small price to pay now that they’vefinally (if several years too late) figured out how to make a profit. But…
As I said the other day, there should be some strings attached. We as a nation have an agenda, and if you’re going to take the market mentality to its logical conclusion, floating the auto industry a taxpayer-funded loan should entitle the nation to demand a few things from the Big Three.
- Break up GM. Sure, I’ll consider a Chevy in the future. But who says it has to have “General Motors” stamped on the frame or has to come from the same factory as a Buick. What the hell’s a Buick anyway? Spin off Cadillac and let it become the Mercedes Benz of American cars once again. (Just don’t let those buffoons at Daimler actually make them into Mercedes, not until the remember how to build a car again.)
- The airlines already have their hands out. Unlike Ford, GM, and Chrysler, the big airlines have to look over their shoulders at Southwest, Air Tran, and Jet Blue. So when the airline industry comes crying to Congress and President Obama, I believe the response should be, “Go to hell.” The airlines had it all and lost it through even worse mismanagement and customer abuse than the Big 3 might accomplish a shadow of on a good day. If we lose the big airlines, there are a lot of smaller ones who’d love to charge you less to take up the slack.
- It’s time to demand payback from American International Group. AIG keeps coming back for more and more and more money. Time for the government to seize this tottering giant and dismember it once and for all. Take control and sell off all the assets and put some money back into the treasury.
- If the Treasury Department is taking a stake in American banks to bail them out, then it’s time to force them to stop hoarding all the cash. In fact, the new Treasury Secretary needs to figure out what the $700 billion bailout is for, then stay on message. Currently, Henry Paulson shows the attention span of a gnat drowning in a mug of Starbucks espresso blend. One day, it’s to buy out bad mortgages. The next day, credit card debt. Then the auto industry. Hank, what is it? You pitch this as an FDR move and then get all Herbert Hoover on us. Bad move, especially for a Republican. Herb gave us a top tax rate of 73%. (Yanno, the rate that made Ronald Reagan say, “Um… Let’s borrow money from Japan and find something a little more sane to charge people.”)
- No bank, manufacturer, or retailer should ever be allowed a position in the market that could threaten the economy if it collapses. Ever. Socialism? Kids, Teddy Roosevelt saw this, and Teddy was a man who loved capitalism. He just knew the game had to have rules. And like Teddy, we seem to be going back to JP Morgan for help. And as grateful as I am to JP Morgan for being as smart as their namesake/founder, I’m not sure I want them acting as a second Federal Reserve. Clean up the banking industry, by all means. But then make sure no one gets too big.
Because I don’t think my grandchildren will be able to afford JP Morgan coming to Congress with their hat in hand.
And while we’re on the subject, since the taxpayer is on the hook for all these stupid business practices, shouldn’t a lot of these executives be facing the prospect of a few years at Club Fed, maybe a federal pound-me-in-the-ass facility? Or even losing their assets?
Just say no to golden parachutes.