Let the Giant Fall

It is easy to speak when you are not the one losing a job or finding that at an advance age – having worked at G.M. all your life – you may not be able to get a decent job. But tough times are here to shape a better future, and letting G.M. survive with a bail out won't be the right answer.

I always had my doubts over Rick Wagoner, I found distress knowing that he always enjoyed a wide support from every employee and car dealer of G.M., meaning that everyone is to blame for the mismanagement. Just after reading an article on the New York Times from David Brooks I came to realize that he is right. Saving the big three will send the wrong message to other companies that are in trouble. After all as David puts it "are the employees of Circuit City or the newspaper industry inferior to the employees of Chrysler?."

Maybe if Ford, G.M. and Chrysler file for chapter 11 they may never recover. But that may be the right signal to send to the companies, you either have a genius like Steve Jobs on your ranks, or you may find yourself begging for money after years of incompetent management. Obama is trying to save Detroit sinking the very own foundations of the American spirit of development.

Those millions of jobs related to this companies that may be lost will put even greater pressure on the already belated job market. No matter what the outcome is the government must assure people that it will take care of workers left out with no jobs, but it will also need to make sure that stock holders and the high management team are left with nothing.

It will be painful to see one of the big three falls into bankruptcy, it may never emerge from chapter 11, but companies like Google will grow stronger trusting their entrepreneur instincts rather than bad calls that could stalled them for years. A bail out on Detroit will only mean that CEOs like Wagoner could still find a high paid job while millions of really hard working smart guys are left unemployed.

If any of the big three survives this crisis it could emerge stronger, really embracing a new technology to transform those polluting machines that we drive today. It could also mean that no matter how iconic a company may be, it knows that it is on its own to forge a stable and prosperous future because Uncle Sam won't be there to save it.

This will also mean that if the government does protect workers, they will feel comfortable working at any company even when it is facing trouble times, they will feel that the state will back them, after wiping out all the big investors money. This will show Kirk Kerkorian to better know where he puts his millions, and stock holders to see a sweet deal when it appears.

We will see what happens if by this Friday nothing really shows that Democrats will have the votes to save the car companies. G.M. does not have enough cash to make it until Obama assumes the presidency next January. So maybe before 2008 ends being the worst year in recent memory, we will find that the big three may be the small two, or the lonely one.