Save GM and Ford!

Save them? Who should save them? I say the government.

Why!

Follow me for a second...

GM and Ford are good businesses they make lots of money. Unfortunantly, they bad management and unions have lead them not to be competitive. Between 1k to 2k of every GM and Ford car goes to fund the pensions of hundreds of thousands of people that don't work at the company any more. This combined with union rates prevents the companies from competing with the Honda's and Toyota's of the world.

Currently, the government is giving these companies "loans" to keep them alive. Lets be honest if nothing is done they will go out of business. Also, the government will end up lossing all the "loan" money and political pressure will probably force them to back the pension liability. If we do nothing, this is the path for the american tax payer.

OR ...

We take bold steps. The government should buy both companies (they have market caps around 3 billion). As part of the purchase process they should negotiate major concessions from the unions. The government could trade desolving the unions for guaranteeing the pensions. Next the government seperates the pension liability from the company. After that it should fire the entire management teams (they people who got them in the mess obviously can't lead). The next step should be to spin the companies back into the market without the pension liability (the government should hold 51% ownership). These should raise 100's of billions of dollars (which will go to pay for the pension liabilities). The new companies should be able to invest into R&D and compete in the global market for cars.

OR we could do nothing and let them go out of business and loss lots of tax payer money in the process. Doesn't make a lot of cents to me.