GM Bailout

GM needs to government help and it should be given. Yes, they've made crappy cars and SUV's for a long time, ignoring market trends and demands for smaller, more fuel-efficient cars.

First, if we're going to bailout the airline industry, which is probably the most poorly run industry in America, there's no excuse not to bailout automakers. Think about it, airlines would rather fly half-empty planes than sell you a last-minute ticket for less than $1,000. That's like walking into a restaurant without a reservation and the maitre'd saying, "Sorry, sir, unless you have a reservation, you're meal will cost 10 times more than the menu price. Oh, you think that's unfair? Well, even though we have 20 empty tables, we'd rather not have your business. Please leave." Seriously, that's a terrible way to run a business. Moreover, if airlines were smart, which they aren't, they would've hedged their fuel like Southwest did, which is why they operate at a profit. Also, how much sense does it make for an airline to fly thousands of miles out of the way to get someone to their destination? Answer: None.

But enough of my ranting about the airlines. Government funding of the auto industry represents a huge opportunity for the country. Like with AIG and Fannie and Freddie, the gov't can put huge conditions on any funds provided to GM. We all know the future is electric cars (or some alternative fuel). GM, Ford, and Chrysler have the infrastructure and man power to make those cars. But they don't have the balls to do so for fear of upsetting stock holders (or hedge fund investors in the case of Chrysler). The know they'd lose money on the first cars and that investing in the technology to make them and market them would cost a bundle. But it's inevitable. So, why not force them to change?

Tesla motors makes electric cars. They cost a lot (like $100,000), but they work. Telsa lacks the infrastructure to mass produce these cars. Tesla's hurting and would probably love to be bought out, just ask their recently-ousted CEO. GM lacks the technology to make electric cars. Sounds like a match made on eHarmony. I say the gov't should infuse billions into GM with the condition that by mid-2009 it must sell at least 500 electric cars based on the Tesla platform (or some other electric car). Sure, they'd lose tons of money on the cars because they'd have to sell them for $40k or less, but the economies of scale would rapidly reduce the losses and bring not just the desired product to the masses, but would put GM in the pole position in electric cars, thus creating American jobs. The jobs wouldn't just come in the factory, they'd also come to the battery companies and other vendors who would be supplying parts to GM.

Look, I'm no genius, but this one's a no brainer. Get on it.