The price of GM's continued existence

I was about to write a spirited rant about the blatant folly of bailing out disgustingly retrograde American car companies, but Lisa beat me to the punch. If you really want to know my thoughts on this, you can find them in a comment on Lisa's post.

But I do want to add one key point. If GM continues to exist and generally suck at making cars, it limits the abilities of more innovative startup companies to grow and gain market share. Companies making cars like the Aptera.


This beauty is actually ready for production, but auto industry regulations essentially written by GM lobbyists are making the producers jump through hoops just to get it on the road. Why does our government hate the car of the future?

Don't Bail Out Detroit!

For those who think American politics will be all rainbows and unicorns after Bush leaves, President-elect Barack Obama just sent a reminder that the Democrats have ridiculous constituencies to please, too. Although Congress passed $25 billion in favorable loans to Detroit's Big Three auto manufacturers in September, they're already begging for more. Today, Obama asked Bush to sign another $25 billion in loans before he leaves office.

Although some argue that these loans can give Ford, GM, and Chrysler capital needed to create cleaner cars, the question is why Honda, Toyota, and upstarts like Tesla Motors don't need similar favors. If we agree to live in a capitalist system, we have to agree to let failing companies fail. Period.

Note to the Democrats: If you are looking for a good policy that might save Detroit, think about fixing the health care system. Part of the problem is that the Big Three pay thousands more per car in health care and retirement costs than foreign companies. Then everybody wins.