Bailout Watch 117: General Mopar Would Be Too Big To Fail

Edward Niedermeyer
by Edward Niedermeyer
bailout watch 117 general mopar would be too big to fail

Fresh off his recent membership in TTAC’s Cassandra club, Daniel Howes of the Detroit News has gone back to spinning bad news into industry gameplans. His latest column extolls the virtues of a GM-Chrysler merger, while admitting that such a move would be disasterous for everyone except GM and Chrysler. “Seen from the viewpoint of blue-collar labor, white-collar employees, local governments, dealers, the state of Michigan and the industrial Midwest, just about anyone whose livelihood depends on the dubious survival of Chrysler would pay a dear price,” writes Howes of a possible GM absorption of Chrysler. But, from the narrow perspective of an industry suit, these myriad viewpoints are just so much firewood to be burnt at the altar of survival. And Howes is conveniently on hand to stack it up and pass the matches.

“In the near term, a fattened GM in the United States arguably could become ‘too big to fail,’ a cynically convenient achievement in today’s climate of political change, economic uncertainty and market intervention.” Not that Howes doesn’t have qualms about such a move. “There are all sorts of reasons why GM shouldn’t qualify for fed help: That its troubles are self-made, the legacy of decades of labor-management ineptitude; that its brands are destroyed, despite recent revival; and that its reach isn’t “systemic” in the way that big Wall Street banks and insurers are to the global financial system.” Yes, but? “There would be political gain in all this,” says Sean McAlinden, chief economist of the Center for Automotive Research in Ann Arbor, predicting an Obama win. “(The Democrats) could lose the entire congressional delegation in Ohio if they let GM and Chrysler die. A Democratic Congress and White House couldn’t possibly let them go down.” And just like that, the worst possible reasons for a merger (making GM “too big to fail”) are taking center stage. Awesome.

Join the conversation
2 of 13 comments
  • SCE to AUX SCE to AUX on Oct 16, 2008

    There is no actual need to preserve GM, other than its support network for existing product, which is sizable. The government will take this over, as well as its pension plan. It is ridiculous to believe GM-Mopar would be too big to fail. The Titanic was "unsinkable", too.

  • Pariah Pariah on Oct 16, 2008
    A Democratic Congress and White House couldn’t possibly let them go down.” And just like that, the worst possible reasons for a merger (making GM “too big to fail”) are taking center stage. For what it's worth, I'd say that political gain is one of the worst possible reasons for making anything happen.

  • Wayne that pict is NOT a small truck, it's a station wagon with a bed.
  • Azfelix Spotify only for me. I have zero preprogrammed settings on FM or AM bands on my car radio. I can listen to emergency broadcasts on my solar/hand crank/rechargeable battery powered AM/FM/shortwave radio that is stored in a Faraday box.
  • Joe Chiaramonte Although in some markets, some AM news stations are simulcasting on FM, FM doesn’t offer similar coverage. FM signals are limited by terrain, AM signals are not. In a disaster, losing AM will eventually matter. AM signals also “skip” on the ionosphere at night, allowing much deeper coverage. From the California central coast at night I can listen to stations in Seattle, Salt Lake City, Reno, Sacramento, San Francisco, San Diego and Los Angeles.
  • Tassos There is good reason this utter pos is in a junkyard.Let it be there and I hope it is soon crushed.
  • Tassos I never ever listen to AM. What a fossil!I seldom even listen to FM radio.I also never had SIRIUS and when I bought a car with the hardware thrown in as a 'gift" I never used it and was actually annoyed at the silly little box that stuck out of the wonderful, luxurious dashboard of my "magnificent 7".Our library has a huge collection of fiction and non-fiction on tape. I have took advantage of long business trips to listen to books I would not have the patience to read at home (Philosophy the no 1 example or Serious History and Biography.And when I feel like music, usually CLASSICAL, either on FM or on CDs.