What effect would a bailout loan guarantees have on GM’s ability (desire?) to go Chapter 11 in order to shed its dealer network and abandon renegotiate its labor contracts? And how about executive compensation? There are a lot of strings here.

At the moment, there are no strings here. Nor are their likely to be the sort you’re thinking about.

Which is precisely the problem. Well, ONE of the problems. [See: Eddy's editorial Aporkalypse Now: The Chrysler Comparison]

http://seekingalpha.com/article/88748-default-risk-of-u-s-automaker-debt-too-big-to-fail

I disagree with the general TTAC editorial line that a bailout of the automakers is a bad thing.

It could be if done wrong, but the fact is that the United States’ economic, energy, and military security requires a domestic auto industry, and we won’t have much of this left absent a bailout.

A bailout structured to induce the Big 3 (and any other takers with substantial US operations) to invest in building a clean and efficient fleet is exactly what we need.

That is probably part of it. Be that as it may, with the exchange rates and market being what they are it is now in their best interest to get those regs changed so they can leverage what they have overseas (product) and here (cheaper manufacturing).

Where does, those thoughts leave you?

Toyota can make the exact same hybrids GM can, at a profit, without requiring American funding.

Witness: Upcoming Toyota Prius.

So, the biggest explosion of I wants/needs by the people of the world was a U.S. government investment for military purposes.

Where does, those thoughts leave you?

They could have pushed for that some years ago but never did. Why? Perhaps to discourage competition from overseas? My cynical thought… to discourage competition from overseas.

Of course this won’t help Chrysler, but then again I don’t think there is much that will.

Sure. Yukon, Suburban, Tahoe, Escalade, Sierra and Silverado. There’s six right there.

If GM put as much effort into selling a quality product as it puts into apologizing for not doing so, it wouldn’t need a subsidy.

What apology?

The theory has always been that the market already has an incentive, for the auto industry and all others.

It’s called a “profit.” When you build a product people want, they buy it and you make a “profit.” When you don’t, you don’t.

Of course, the government has long had a disincentive, one that discourages making a profit, called an “income tax,” so one thing the government could do if it wanted to encourage business is lower taxes.

But, no, this isn’t an “incentive.”

It’s a “subsidy.” A “subsidy” is when the government gives a business money to produce a product that people won’t buy, but that the government wants the business to produce.

In other words, a product that cannot be made at a profit.

If GM put as much effort into selling a quality product as it puts into apologizing for not doing so, it wouldn’t need a subsidy.