Hey Buddy… You got $7.7 Billion to Spare?

taxesToday General Motors (GM) announced that without a $ 7.7 Billion infusion of additional capital, it has “substantial doubt” about its survival. General Motors! One of the pioneers of the auto industry is on the brink of failure!

If this doesn’t drive home how f**ked up things are right now in the business world, nothing will. Now, it’s a known fact that GM has been on the edge of bankruptcy for a long time, but for GM to finally come out and admit it, well, you should know that things are probably already over. I’m not going to discuss the short/long term ramifications of a GM bankruptcy since they are many and ugly, but I am going to say that I don’t want to see it happen; although, at this point it may be best.

From a political standpoint, many on the Right (Republicans) have advocated the failure of poorly run companies, where many on the Left (Democrats) have engaged in a, “we can’t let these companies fail” policy. With tax payer money being used to rescue these companies, can the Left continue to maintain a “save them at any cost” policy?

7.7 Billion dollars! In this new era of trillion dollar bailouts, that seems like pennies, but the fact is, giving GM the money will likely only allow it to survive another few months (at best); after which time it will be back at Washington’s doorstep asking for more cash.

Can we, should we, continue to pour money into companies that, at this point, seem doomed to failure?!? Should we keep these companies on financial life support? I do not envy President Obama’s quandary. No matter what choice is made, millions of Americans are going to be dissatisfied with the decision.

Cadillac, Pontiac, GMC, Buick and Chevrolet… These are American icons. Truly as American as apple pie, yet they may not survive to see 2010; certainly not in their current forms. Is it in our best interest to save these companies, or should we just let them fail?

Max

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