Washington is reluctant to bail out Big Auto, yet fearful of Big Auto bankruptcies. But there is a third option that no one has seriously considered.
Shut up and place an order.
Congress could easily slap down $100 billion for roughly 5 million new cars.
At $20,000 apiece, these wouldn’t be BMWs or even VWs.
They would be BWs. Or what I like to call Bailout Wagons.
The Bailout Wagon could be jointly manufactured by General Motors Corp., Ford Motor Co., Chrysler, and any other failing company shameless enough to fly top executives to Washington, D.C., on luxury jets to whine about the credit crunch and pretend that loose auto financing contributed nothing to the burgeoning crisis.
Why did consumers over-leverage their homes? Often it was just to buy those land yachts made in Detroit.
Driving a sleek, new Bailout Wagon would be a lot more fun than listening to a bunch of bungling bosses pontificate about how vital they are to everyone in America . . . even folks who would rather drive Toyotas.
“The collapse of the U.S. automotive industry would be a calamity for the entire economy,” Ford chief executive Alan Mulally warned Congress on Tuesday.
“Our Jeep was an indispensable part of our nation’s efforts in World War II and Korea,” Chrysler chief executive Robert Nardelli reminded those in the room who may have never watched M*A*S*H.
“What exposes us to failure now is not our product lineup, or our business plan, or our long-term strategy,” declared GM chief executive Rick Wagoner.
Instead, he said, it’s “the global financial crisis, which has severely restricted credit availability, and reduced industry sales to the lowest per-capita level since World War II.”
During World War II, the U.S. government went to big industries and placed big orders. Some historians argue that this is what really lifted us out of the Great Depression. Perhaps it’s time to resort to a similar economic strategy.
Failing automakers should be charged with building a massive fleet of standard-issue, plain-white station wagons with gray cloth interiors and bar codes instead of racing stripes.
These Bailout Wagons would be plug-in hybrids, cutting down on our nasty dependence on foreign oil in an unexpected era of $1.85 gasoline that will otherwise keep Americans cruising in SUVs until gasoline hits $4 again.
Automakers might also consider a natural-gas-powered option so that the $58 million T. Boone Pickens just spent advertising the “Pickens Plan” wasn’t entirely for the sake of his personal vanity.
Obviously, the federal government could use the Bailout Wagon to make its own fleets more efficient, saving taxpayers money.
But these versatile vehicles also could serve as currency to back credit-default swaps at the largely government- owned American International Group Inc.
Did your entire subprime debt portfolio default? Here, have a Bailout Wagon.
Need a blank check to meet capital requirements at your failing bank? Here, have a Bailout Wagon.
Didn’t get a big enough Wall Street bonus this year? Here, have a Bailout Wagon.
Before governors like California’s Arnold Schwarzenegger come begging for federal aid, they will already know the answer. It would just be a question of how many Bailout Wagons they actually deserve.
States, in turn, could offer Bailout Wagons to struggling counties and municipalities, which could then offer Bailout Wagons to their workers in lieu of pay. A new Bailout Wagon sure beats a layoff any day.
Progressive cities would likely provide Bailout Wagons to people losing homes to foreclosure, too.
See, this is why they should be station wagons.
Fold down the rear seat and there’s plenty of room to sleep. Add an optional video player and an iPod jack and the Bailout Wagon will feel just like home.
Wouldn’t it be fun to spot Wagoner, Mulally and Nardelli at a highway rest stop sleeping in one of these?
Al Lewis: 201-938-5266 or al.lewis@dowjones.com
