I usually try my hardest to ignore The New York Slimes, the nausea induced by their complete lack of journalistic integrity is too much to stand. But, recently David Brooks and Thomas Friedman have been writing good stuff. I posted one of Friedman’s columns a few days ago, and today my uncle e-mailed me Brooks’ and Friedman’s columns on the auto industry, they are both worth posting here.
Friedman argues that mismanagement at the Big 3, in addition to the failure of Michigan’s entire congressional delegation to do anything besides follow the demands of the companies and the UAW, have led to the current crisis. He says that if we are to send taxpayer dollars to the Big 3, the money must include some conditions: firing the Board and Management, stripping contracts from the Unions and re-negotiating, appointing a “czar” with “broad powers” to revamp the industry, and forcing the companies to get rid of gas-guzzlers and invest in “innovation.”
But what about Bankruptcy!? The United States, as David Brooks rightly asserts, already has a system for rescuing those who have fallen on hard times, or companies that have failed for any reason. It’s called bankruptcy, and it is basically a time-out in which one can restructure, re-organize and come back leaner, stronger and more efficient. In the free-market we have what Brooks calls “creative destruction,” breaking down the old and worn, for the new and efficient; this is something that can only work in a competitive market. Keeping dead companies afloat on taxpayer dollars kills competition, and wastes money that could be used for real innovation. Brooks offers two options in his closing:
Is this country going to slide into progressive corporatism, a merger of corporate and federal power that will inevitably stifle competition, empower corporate and federal bureaucrats and protect entrenched interests? Or is the U.S. going to stick with its historic model: Helping workers weather the storms of a dynamic economy, but preserving the dynamism that is the core of the country’s success.
Let’s hope the Democrats will choose the latter. Like my uncle said in his e-mail:
People voted for democrats and change is coming,
Unfortunately, it is the worst kind of change.