First, a word to Max Baucus: And you wonder why Democrats always beat up on you.
Now to the Republicans. So you want to force us to lose another 2 million jobs in the throes a massive recession? Don't forget, these are the same Republicans who were happy to throw the stock market into a tail spin because they didn't want to bail out the banks. Now they don't want to bail out the car industry. Well, folks, sorry to tell you, the patient is dying here. I'm not a real fan of the mortgage bailout. As a first-time buyer, all it means to me is that you're artificially inflating prices and making it more expensive for me to buy my first home. (I'm also not thrilled about bailing out banks who knew what they were doing.) But I understand that we don't have a choice. The repercussions to the economy are too great if we just let everyone go into foreclosure. So I suck it up and accept that we have to have some kind of bail out. Same thing goes for the auto industry.
Our auto industry is huge - some estimates are that millions of jobs could be lost over the next year if we let Detroit go bust. With the economy already in a deep recession, that would be catastrophic to all of us. So it's no longer about bailing out those [insert here] "stupid unions" or "stupid executives." It's about covering our own asses.
There was a popular joke amongst the international relations crowd in the mid 1980s, during the height of the Latin American debt crisis. In a nutshell, western banks had loaned Latin American governments (often corrupt military governments) a gazillion dollars (over $300 billion) that they subsequently wasted. The new democratic governments in Latin America didn't think they should have to pay the old corrupt loans. The western banks said "uh yeah you do," and the banks refused to bailout out the Latin American economies by finding a way to forgive, or at least lessen, the debt. So here's the joke:
LATIN AMERICAN GOVERNMENT ASKS WESTERN BANK: What do you call it when I owe you 300 million dollars?I.e., if Latin America went bust, then the banks wouldn't get a dime. And while they could afford writing off a few hundred million, they couldn't afford writing off a few hundred billion. So it was in the interests of the banks to figure something out, regardless of whether the Latin American governments deserved a bailout.
WESTERN BANK: Dunno.
LATIN AMERICAN GOVERNMENT: "Big trouble for me."
LATIN AMERICAN GOVERNMENT: Now, what do you call it when I owe you 300 billion dollars?
WESTERN BANK: No idea.
LATIN AMERICAN GOVERNMENT: "Big trouble for you."
At some point, the problem becomes so huge that it threatens to hurt everyone, not just the guy seeking help. Whether we like it or not, homeowners who gambled on their mortgages and lost, big banks who gave out loans like candy, and automakers who never modernized for the 21st century all have us by the collective juevos. That doesn't mean we just hand them cash. But it does mean that we have to hold our noses and do something to ensure that they don't take all of us down with them.
The congressional Republicans - and lapdog Max Baucus - are playing with economic fire. It's time the Democrats showed a little backbone and went to the American people and told them exactly what's going to happen if Detroit goes belly up. Then tell them who to blame: Max Baucus and the congressional Republicans.
