The Case for General Motors

When the Soviets shut off all land routes to Berlin after the close of World War II, there were many bright people who said expending a huge effort to save a few million hungry Berliners would be a waste. The denizens of Berlin had started this war, and were we to let the few there in Berlin who believed in democracy lose, it would give us a better chance to protect democracies elsewhere.

Those people were wrong. The Berlin Airlift was us proving to the world and to ourselves that there is no challenge so great that it can overwhelm the combination of American effort and American ingenuity.

Detroit is another city in trouble. Another city led by those who, through their own actions, let themselves fall into dire straits. Let's not forget the lesson of the Berlin Airlift. When we saved Berlin, we essentially won the Cold War, building a beacon that survived another four decades of turmoil to emerge as the burgeoning light of democracy in Eastern Europe.

Ironically, the government of Germany is now willing to bail out Opel, GM's German arm, with the lines of credit that the automaker may need if its American parent company starts to go under. They join Japan, another country we helped put back on its feet after WWII, in safeguarding their own automakers.

There are many intelligent and thoughtful people who believe that we should let General Motors fail. Those people are wrong. The company has committed many errors in the last quarter-century. Much of GM's management has been slow to see changes occurring in the market. And yet the company is still the second largest automobile manufacturer in the world. This isn't about jobs and this isn't about some romantic attachment to American car companies. General Motors isn't actually that unsuccessful and were we, in a moment of panic and uncertainty, merely to let it die, we'd be taking the historically un-American position of viewing a time of crisis not as an opportunity to make dramatic systemic changes but instead to cede our place among the major producers in the world.

The collapse of the American car company is part of a greater economic meltdown that is affecting every retail sector, with the one possible exception of discount salted meat products. We've falsely inflated our economy on the backs of mortgages that could never be repaid, under supervision of people who could never say no to more money, resold through a complicated system of securities we could never explain. For General Motors, it couldn't have occurred at a worst time.

Chrysler has proven to have no plan for the future and maybe should be left to die. Ford is sitting on a mountain of cash and was smart enough to secure a line of credit when credit was easy to come by in order to carry itself through hard times. Ford is also close to releasing a series of more fuel-efficient vehicles that are immensely successful in Europe and other world markets. General Motors is close to doing the same. But with no reserves of credit and limited reserves of cash, they may not get the chance.

General Motors was expecting to release the Chevy Cruze in the next two years, a vehicle that's everything the company should have introduced long ago. It's arguably more attractive than a Toyota Prius, while offering nearly comparable fuel economy at a much lower cost. That vehicle may never reach market if we let GM fail. Neither will more fuel efficient trucks built on crossover platforms or world-beating luxury coupes or the Chevy Volt.

Even if GM weren’t closer to turning a corner, the fault is as much with our society as it is with them. American car companies, among our last great manufacturing entities, have been weighed down by healthcare costs and ridiculous labor contracts that have made the fact that they've ever turned a profit some kind of miracle. Is it the fault of employees who want to make a living wage or have healthcare and pensions? Absolutely not. It's the fault of a society that has yet to make healthcare a priority. Savings a priority. Anything important a priority.

We had a chance to fix this in the previous decade, taking advantage of our sudden prosperity to alter the course we were on. We didn't. General Motors didn't invest its newly found riches, the result of cheap gas and rising wages, into more fuel efficient vehicles or hybrid technology. But neither did we as a society, with a Democratic president and a Republican Congress, use our surplus to invest in a sustainable retirement system or alternative fuel technology or a responsible healthcare system. We all bought houses we couldn't afford and bragged about how we balanced the budget.

This massive failure in our economy, this Mini Depression, is awful. My father was laid off recently and my mom probably isn't getting the Christmas bonus she usually uses to buy everyone presents. Remember when there used to be money in our 401(k)s? Not so much anymore. It sucks. As hard as all of this is, no one has said this isn't an opportunity. The disagreement is over what we will do with this opportunity.

The naysayers, the Detroit-haters, the disgustingly hypocritical Wall Streeters will say that this is an opportunity to get rid of General Motors. They'll say that this is an opportunity to cut our losses and invest elsewhere. They're wrong. This is an opportunity for taxpayers, whose money has not been well-spent in a poorly executed war, to make an investment in GM while it's cheap.

GM isn't asking for $700 billion in an unsupervised handout. They're asking for supervised loans handed out by our government in a way that will let us mandate that money is spent to keep people employed, change the broken Detroit model and give us the cars we want. We're going to make that money back and, in addition to whatever small interest we receive, we're going to get the cars we want and the jobs this economy desperately needs.

By investing in General Motors, we can help safeguard the idea of America as a country that produces things. We can prove, once more, that we are a leader among nations. It's the deal of a lifetime.