Mitt Romney Op-Ed. Let Detroit Go Bankrupt

[Onceler]

So delay the disastor until sometime in the future and hope the economt improves?

In a nutshell, yes. GM going chapter 7 right now - at this moment, when we're on the precipice of a true collapse - could be a real death blow.

We're in a bad period, but it's not like chances of recovery are slim right now. Our economy could be solid in a year's time, and certainly in 2-3 years time, and be much better able to absorb the brunt of GM failing.

 

[Cancel3]

In a nutshell, yes. GM going chapter 7 right now - at this moment, when we're on the precipice of a true collapse - could be a real death blow.

We're in a bad period, but it's not like chances of recovery are slim right now. Our economy could be solid in a year's time, and certainly in 2-3 years time, and be much better able to absorb the brunt of GM failing.

That makes good sense. But I wonder if you could sell it under those terms.

An automaker that is expected to fail isn't going to sell many cars with 10yr warranties.

The problem is that they are not selling enough cars. Between now and when the economy gets rolling good again, they are still not going to sell many cars.

Whether its the unions or the mgmt of the company that is at fault, the end result will be the same.



But I do tend to agree that now would be the worst time to let them fail.

 

[Cancel3]

But I have also argued both sides of this particular issue. Its a tough call, and neither route seems to be appealing.

 

[Onceler]

Yeah, I know what you're saying; I've been more conflicted about it than I'm letting on.

The ideal, of course, would be that a bailout NOT be a temporary measure, and could somehow be tied into conditions that would practially force Detroit to catch up w/ the rest of the world, and make American cars that Americans actually want to buy.

 

[uscitizen]

But I have also argued both sides of this particular issue. Its a tough call, and neither route seems to be appealing.

GM Will not be the only lose/lose situation we will face in the near future.
the answer will depend on is it better to lose now and rebuild or delay the loss by subisdizing it for a time with borrowed money ? GM Borrows from us that we borrow from China or the middle east or somesuch..