The case can be made that allowing GM to file Chapter 11 bankruptcy would be an orderly dismantling of a failed business model with atronomical labor costs. Let them go. This is far different from having a bank go out of business with a bank run.
Chrysler's deal in the 1970's was a mistake.
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I saw this in the NYT. Apparently an auto industry bailout will be a platform (from Obama's perspective) to get into "green" auto technology. Kind of making the industry the lab, so to speak.
http://www.nytimes.com/2008/11/10/us/politics/10talkshow.html
An interesting application of command economy notions, perhaps?
Raise gas and carbon taxes... you'll see green technology immediately.
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