Bailout du’Jour

I have not yet commented on the impending doom from Detroit and the efforts to bail them out.  It’s been the talk of the Sunday news programs, however, and since I’ve been using today to catch up on the blogging I’ve not been able to do during my busy week, now seems the time to comment.

I have to start out by saying that Meet the Press this morning was, as ever, an exercise in false equivalence.  The guests where Carl Levin of Michigan and Richard Shelby of Alabama.  A guy who is in the tank for automakers and a hard-line Conservative who wouldn’t agree to tax-payer funded water if his hair was on fire.  This is not a useful discussion, since neither man is in a position to compromise, but compromise is exactly what is needed in this case.

Because if ever there was an industry I would be in favour of letting crash and burn – hoping that we could finally then let more innovative minds and more cost-effective business models take the lead – it would be the auto industry.  Nowhere in American business is there a more completely ass-backwards group of companies. . .  and that’s saying quite a lot.  Still, its not an industry we can expect to let drop without having huge and probably unpredictable consequences on the rest of the economy.  There are simply too many people working in the industry and too many subcontracting companies tied to it to think we can let the automakers drown themselves.

What is required is that we yes, do bail out Detroit.  But we do so in a way that guarantees us a better chance of a viable auto industry in the future.  It’s not a simple question of letting them go or handing them a blank check.  Carl Levin said today that the auto industry might have had problems “ten or twenty years ago,” but that they’re making changes.  Bullshit.  They’ve made half-assed efforts at going hybrid – itself not a solution to our energy problems – only in the last two years.  And what have they produced?  Hybrid SUVs.  Hybrids which get a paltry 34 miles a gallon, compared to the 40-50 MPG of Asian counterparts.  This hardly represents a true effort at reform, particularly when there are plenty of minds working on the issue in garages and backyards whose ideas are not being listened to.

So, we need not a bailout package, but an investment plan in our auto industry which considers the future as a primary means of growth.  We should demand that Detroit automakers actually engage small private businnesses working on energy-smart cars and use their industrial might to produce those cars.  Similar things are commonplace in the record industry, where small indie labels like Interscope or Def Jam are distributed by Sony or Warner Brothers, but exclusivity has plagued the auto industry.  Yes, I’m aware that there are downsides for Interscope.  But the point is that Detroit has gone out of its way – Microsoft style – to crush competition in its infancy, and it is precisely those infant companies that are generating the ideas we need.

And of course, we need leadership.  Barack Obama has been trying to stay off the stage and work on his cabinet, since after all, he’s not yet the president.  But the problems we face currently are much beyond the ability – and let’s be honest, the desire – of our current White House resident for him to handle.  As hard as it undoubtably must be, Barack Obama is going to need to find a way to represent a leadership role – even if that leadership is only a Senate-bound leadership – to help steer the ship as best he can in the next few months so we can get things done in something approaching a rational way.

By Tommy Belknap

Owner, developer, editor of DragonFlyEye.Net, Tom Belknap is also a freelance journalist for The 585 lifestyle magazine. He lives in the Rochester area with his wife and son.