The GM Bailout

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THE GM BAILOUT….Jim Manzi comments on the restructuring plan that GM is submitting to Congress today:

I guess somebody who’s never read a real business plan might mistake this document for one, but it’s a joke. It’s basically a list of assertions of amazing improvements, entirely discontinuous with actual performance to date, that they will achieve. What’s missing is any real indication of how they will go about accomplishing this.

Hmmm. Sounds pretty normal for a business plan to me. List of assertions? Check. Unrelated to past performance? Check. Lots of handwaving about how goals will be accomplished? Check. Back in 1999 some venture fund on Sand Hill Road would have funded it in a minute.

Kidding aside, though, Manzi is probably right: this is meant as a political document, not a real business plan. And after GM blows through the $18 billion they’re asking for by next spring, they’ll be back asking for more. And who will have the guts to turn them down after already investing so much taxpayer dough in the first place?

I’m just very skeptical of this. Bailing out the financial industry is one thing because the financial industry is different. When it goes down, we all go down. But there really is a slippery slope problem here: once we go beyond the financial industry to the auto industry, what stops us from bailing out farmers and house builders and shipbuilders too? There just has to be a better way of handling this than forking over giant wads of cash with very few strings attached. GM doesn’t need surgery, it needs to be rebuilt. That won’t happen if they get an $18 billion bailout from Uncle Sam.

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We didn't know what to expect when we told you we needed to raise $400,000 before our fiscal year closed on June 30, and we're thrilled to report that our incredible community of readers contributed some $415,000 to help us keep charging as hard as we can during this crazy year.

You just sent an incredible message: that quality journalism doesn't have to answer to advertisers, billionaires, or hedge funds; that newsrooms can eke out an existence thanks primarily to the generosity of its readers. That's so powerful. Especially during what's been called a "media extinction event" when those looking to make a profit from the news pull back, the Mother Jones community steps in.

The months and years ahead won't be easy. Far from it. But there's no one we'd rather face the big challenges with than you, our committed and passionate readers, and our team of fearless reporters who show up every day.

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