The Big Three automobile companies (Ford, GM, and Chrysler) look more like the Three Blind Mice. Now that the big bank executives revealed the secret to begging for government money to sustain the Bling Lifestyle, the Big Three want their piece. Not long after the banks got pizzaid, automaker executives boarded their expensive private jets to kiss a** and beg for
free bailout loot.
If you watch the news at all, you know that the Big Three bailout is supposed to save a kazillion jobs and keep plants open. Supposedly, unlike the bailout lottery ticket for bank executives, the Big Three bailout will come with strings attached like decreased executive compensation, restructuring, and cost cutting. I'll believe the "strings" when I see them, but I'm more concerned about one question:
If payroll is the biggest corporate expense, won't the string called "cutting expenses" mean cutting those jobs and closing plants anyway?
That question summons the big pink elephant in the room - the employees who lose anyway. You surely can't cut out windshield purchases or rear-view mirrors. In fact, if the big cuts came in materials, consumers would be left asking, "Dude... Where's My Car?"
Media blurbs entice the taxpayer's giving spirit with claims that a bailout equals safe jobs. But I have yet to hear (1) that a single job will be saved or (2) how the bailout option (public risk) compares to outcomes if the Big Three file bankruptcy (risk remains within private walls). Bankruptcy leaves the risk where it belongs - on the decision makers in the private industry. Why risk taxpayer money if the outcome will essentially be the same?
Before I digress too far, I want to share a bit of straight talk from Robert Reich as he addressed this in a blog post titled The Bailout Paradox:
Just in case you're not quite ready to thank Reich for his straight talk, how about this historical reference he threw in for good measure:
Not only job loss, but jobs that never came back.
We're clearly in a heaping pile of steaming hot sh*t.