Ford is fending for itself without a bailout from Washington, but GM and Chrysler have filed their restructuring proposals with the government in order to receive additional billions to keep them solvent. On Tuesday, GM received the final $4 billion on a $13.4 billion federal commitment. Chrysler, also getting $4 billion, has requested an additional $3 billion. The money is conditioned on GM and Chrysler coming up with comprehensive restructuring plans that will prove to the government that they have made “aggressive” progress since they pleaded with lawmakers last December for financial aid. Members of Congress told the company CEOs that everyone had to make sacrifices, including management, unions, suppliers, investors and bondholders.
Here’s a better idea: Let them die a slow death, with the emphasis on slow. Tell workers (management always seems to land on its feet) that they have a fixed amount of time to look for new jobs. Government will help them with training and education, but government cannot prop up companies that no longer make products people want to buy in large enough numbers for them to remain profitable.
There are many reasons the car companies are in trouble, all of which have been reported in the major media, but that is the past and it is way too late in the game to do much about guaranteed pensions and health care that ended up crippling GM, even after the company successfully negotiated with United Auto Workers members to decrease retirement benefits – which, honestly, is a little like quitting smoking after being diagnosed with lung cancer.