KILL CHRYSLER

Now, let me see. How can I alienate all of my Michigan friends at the same time?
I know! I'll suggest closing down some Michigan auto plants! Nothing raises the hackles of a Michigander faster than threatening their high-paying shop jobs. Maybe I'll even get myself some more of those death threats that I love so much.

But, on the serious side.

Anyone that has been paying any attention at all knows that the U.S. automakers are in serious trouble. This really isn't any groundbreaking news. When I was in high school, many eons ago, my teachers were already telling us that these shop jobs were on their way out. Then in the 1980's the shops started laying off and tens of thousands of workers lost their jobs. Yet, here in Michigan, we still didn't get the message. Even Bruce Springstein, who's not the brightest guy on the planet, understands. In the 1985 song "My Hometown" he says, "these jobs are going boys, and they ain't coming back". Yet here in Michigan, we remained clueless.

Fast forward to the present, and here we are again, still not getting it. So, let me make this as simple as I possibly can; The U.S. auto market is too divided and competitive for the government to continue to subsidize three different parts of a failing industry. One of the Big Three has to die.

In the later part of last year, GM, Chrysler, and to a lesser degree, Ford, all went begging to the Bush administration for money to help them survive the vicious downturn that our country is now experiencing. The first sign of what a problem this was going to be was in the fact that the automakers raised the amount that they needed by $9 billion in just the 6 weeks of negotiations. The U.S. government then decided they were all "to big to fail" and covered them to the tune of $17.4 billion taxpayer dollars. I then predicted that they would be back for more within a couple of months and lo and behold, I was right. Move over Nostradamus. Now they (Chrysler and GM), want another $14 billion (or more) and I'm going to make another brilliant prediction-they'll be back again. The problem is, we're simply not addressing the core problem. Not enough people are buying American cars to support all three car companies. We can bail them out till 2020 and we will still have the same problem.

Then the question is; Who should we save and who should die?
No matter the answer, someone is not going to like it.

First, let's all agree that Ford isn't even in the running to be eliminated. Ford is still viable and isn't even asking to be bailed, they only wanted a line of credit-just in case. One of my chief complaints about how all these bailouts are being passed out is that we keep giving the most to the people who are performing the worst. Ford proves this point. They get no subsides because they are the most successful. We give more money to GM than to Chrysler simply because they are further in debt. This is rewarding bad behavior and the golden rule of rewards is, "Whatever you reward, you will get more of."

However, on the flip side is the argument that GM is bigger than Chrysler and therefore needs it more. By the numbers, GM employs 230,000 workers while Chrysler only employs an estimated 100,000 (it's next to impossible to get an accurate estimate on Chrysler's workforce) This in and of itself says the impact of a failing GM would be harder for the economy to absorb.

But I have an even bigger problem with bailing Chrysler.

Unlike publicly-traded GM, Chrysler is an LLC (Limited Liability Company). It is owned by the investment firm Cerberus. What this means is that Chrysler is privately owned and therefore doesn't report it's assets and debts in the way that GM has to. This is one of the reasons that it's so hard to put an exact figure on their employees, executive pay, liabilities and debts. In fact, we're pretty much taking their word that they're in debt at all. Cerberus, which owns Chrysler, has it's own assets that it refuses to put into Chrysler. That raises the question, if Cerberus doesn't think it's a good investment to pump more money into Chrysler, why should the taxpayer?

The bottom line here is this; There just isn't enough market left to support all three American carmakers. Eliminating one creates more market for the remaining two. Since the American taxpayer is only going to tolerate so many bailouts, I think it's imperative that we focus on something that will more likely work on two automakers than directing our resources and efforts on the less likely prospect of saving all three. If we all think about this logically, there can only be one answer to the problem of what to do with our struggling automakers. Chrysler must die. H.C.