Where’s MY Bailout?

Ad that says: You wouldn't buy our shitty cars. So we'll be taking your money anyway.
Ok, so there are at least 100 jobs directly or indirectly dependent on my being kept financially viable. I am just TOO BIG TO FAIL. So its time that I get MY Bailout from the government. I don’t need too much, a simple $1M will do for now. That’s about the same ratio as the amount being asked for by the Auto industry vs. the amount of jobs they say it will protect. I’ll pay it back someday I’m sure…

Well, if you won’t bail me out, then check out Larry Lessig’s rant on all this (as seen on Boing Boing:

These bailouts are an awful idea — the worst of K St. capitalism (== kapitalism) inviting an insanely bad future for the industries affected. If there’s one thing worse than Detroit managed by the managers who have been driving the American auto industry into the ground for the past three decades, it is Detroit managed by politicians.

I’m not against all bailouts. I think it was appropriate to save the airline industry after 9/11, for example: That was an unexpected shock that produced a failure not directly related to the bad management of the airlines.

But these bailouts are not that. Both the auto industry and the banking industry are insanely inefficient. They have been for decades. And rather than being saved from a shock, both need a significant shock to management to radically change how they do business.

Perhaps the shock to banking would be too great just now. I’m willing to be persuaded that intervention is necessary there. But the more I read about the auto industry, the less I am convinced.

People speak about this as if not bailing out Detroit means automobile production in America ends. That’s not what failing to bailout Detroit means. Not intervening now would be these automakers would enter bankruptcy. And bankruptcy means the assets of these dinosaurs get reorganized: Someone else buys these companies, at a price the market sets, and runs them profitably, because of the price the market set.

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