Failure is not bad .. if we don't repeat our mistakes

Does anyone else have an image like this one in their mind when it comes to the bail out ? No this does not represent the employees of failed companies, waiting in the unemployment line, it doesn't take much of an imagination to envision that. This represents the CEO's of failed companies standing on line at the White House, waiting for their chance to make a case for a bail out check. If banks can get government capital, backed by taxpayer funds for as little as 5% annually, why shouldn't the automakers, retailers, media groups, real estate conglomerates, CPG manufacturers, etc, etc, etc, hope to get the same level of assistance. This is a damn good deal. 5% ! wow...capital has not been this inexpensive in decades.... especially when you consider that the funds will be awarded with little to no conditions attached to them.

Relief in the form of a bail out, similar to what 12 primary financial institutions have received to date, has stalled for the automakers. Their timing is off, much as it has been in their business models.

I have been consistent in my view of the bail out(s). I am against them, philosophically. They are politically motivated, more than they are genuinely corrective. The TARP funds have been misappropriated from the very first $. Our panic to save livelihoods is not inappropriate, but our solution has been chronically misguided. The lessons here: 1. Do not expect comprehensive understanding of economic impact, if your advisories are narrow in their expertise, and powerful enough to push through a self serving agenda. 2. Do not distribute financial aid to secure a vote unless that aid will actually help the voter.

Our financial markets are in dire straits due almost entirely to deregulation enabled by government. The SEC has been rendered powerless by its own forceful compliance and support of deregulation. It has willingly given up its responsibility of oversight...made abundantly clear by the recent Madoff ponzi scheme, which went unrecognized or deliberately overlooked for at least a decade. We have serious problems within our financial institutions that have burled their way deep down into the very basic SOP's of healthy business principals. Simple concepts such as weighted risk thresholds to protect solvency have been completely ignored. So yes, we need to plug the hole in the dam, stop the bleeding, and fix. REALLY FIX! To date we have not appropriated assistance with the intent to fix. We have only thrown out a champagne filled life boat, to the crew on the sinking ship, and left the passengers on that ship to fend for themselves.

Should we really do this for the auto manufacturers as well? To what end? If anything, lets try the reverse this time. I suggest we use relief funds to send Cadillacs and Chevy Tahoe's to the autoworkers and transport them to their next job, in a new vibrant industry, like sourcing, harvesting and deploying alternative energy sources. Use relief funds to pay them competitive wages, in new industries that America needs to prosper and become more self sufficient. This time, let's leave the CEO's in the dust of their mismanagement, narrow mindedness, failed and stagnant business models, facing backward.

Don't get me wrong. Government needs to help..significantly and abundantly. But the aid should be focused on the workforce as well as supporting vital new growth. If we don't focus our borrowed financial might in this direction, it will be increasingly difficult for America to lead globally.

It is important to recognize that products, services and entire industries can become obsolete over time. Markets change. Innovation advances and creates new power for the consumer. America is great because it allows markets to change, prosper and fail. If we continue to support failing industries, we will do it at the expense of innovation. This is not to say that the automobile is obsolete. Far from it. But we may not need 3 major domestic auto manufacturers. Perhaps two or even one with the most vibrant, nimble and efficient production will be more than adequate to serve consumer demand. I don't know the answer to this question. I don't know how many cars need to be competitively produced annually to serve consumer demand at a profitable rate, but bankruptcy and forced reorganization will clarify, at least some of these issues. I don't know why people are frozen, in fear of bankruptcy filings. Many industries, most notably the airlines, have used bankruptcy to successfully adjust business models to current and future markets. What is so wrong with this? It is a great option. If the government concentrates on workforce aid, financial relief can be allocated and adjusted based on bankruptcy discovery and manufacturing adjustments. It can be used to keep displaced employees in their homes, and moderately spending until their new job is ready for them. You know all of the able bodied railroad workers found new jobs. GM autoworkers will find new jobs, too. The government needs to generously bridge them, while we are funding new industries. Think of it as a transition plan, not a perpetual loss of jobs.

It is scary, but it is necessary. We have got to stop thinking like wimps. Instead we need to stand tall. Take the hit. Commit to helping each other and move forward with strength, bravery and conviction. We can't really regain power as a people or a nation, if we are protecting the forts that don't matter anymore. We have to build new forts that are invaluable and thus worth our proactive support and aggressive protection moving forward.