Detroit finds itself in a bit of bad timing. Given Paulson's poor strategic performance with TARP, the Big 3 find themselves at a place in line while Congress is hearing a growing noise of dissatisfaction from constituents as to the progress on the war against economic disaster.
It is essential to provide relief to the Big 3 during this period of economic upheaval. Republicans in Washington keep using the mismanagement argument to explain their opposition to a bailout. They claim Detroit had years to adjust to the marketplace but merely pursued a strategy of fuel inefficiency and poor quality.
They are absolutely right, but we need to bailout the auto industry. The US cannot afford to continue to allow our manufacturing base to disappear regardless of the current automakers upheavals. The Republicans got the problem right but as usual have missed the complexity of the issue. To allow manufacturer producers as large as auto to sink without understanding the linkage to so many other vital elements of commerce is short sighted. From auto parts which provide for the nations existing auto population, to strategic industrial capabilities for national security, an industry which actually produces something, rather than the ones Paulson is pimping for who simply charge fees for designing financial instruments which do not work, is worth saving. Congress can mandate terms in an agreement this time rather than laying down as it did for Treasury. Bankruptcy will drag on forever and feed upon the uncertainty which is driving the fear in today's markets.
