20
Nov
08

To bail or not to bail…

Suddenly the coffers of the U.S. government seem to have been transformed into magical Santa’s stockings where mismanaged American businesses can all go for a new lease on life. I guess that phrasing doesn’t hide my opinion of the various government bail-out programs currently under consideration in Washington, D.C. Our senators and congressmen have already voted to steer $700 billion into fixing the mess in the sub-prime mortgage industry and this week are considering throwing a financial lifeline to the Big Three automakers. The consequences of these companies going down for the count are too frightening to contemplate; millions of jobs would be lost, both in direct employment as well as in industries built to serve Chrysler, Ford, and GM. The loss of those jobs would be devastating not only for the families involved, but also for their communities, Kansas City included. However, I for one really have zero confidence that this will be money well spent. I know someone who decided 20 years ago that she would never again buy an American car as long as she lived. She made this decision for two reasons; first because she said the quality of American cars was completely lacking and second because of the apparent lack of market awareness in Detroit. As economic and environmental conditions in the world changed, increasing the appeal of smaller, more fuel-efficient cars, the U.S. auto industry just kept pumping out gigantic gas-guzzlers that completely wore out in three years. To tell you the truth, I really see no evidence that this myopic, “damn the torpedoes! Full speed ahead” outlook has really changed all that much. What has happened is that the proverbial chickens have come home to roost. The golden goose of the loyal “Buy American!” consumer has stopped laying its predictable golden eggs and suddenly no one wants what Detroit is building.

What happens in the real world to a company that stops responding to its customers is that it pays for its arrogance by going out of business. Unfortunately, standing by and watching the Big Three circle the drain is not really an option. We have to save them from themselves. But I would sure like to see some indication that there will be some new thinking at the top if we do. And since it is going to be my tax dollars that are part of that lifeline, I should be able to insist on a true change of heart before I write this check, shouldn’t I?


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