Diary

Everyone is not too big to fail.

Popping those bubbles didn’t work. Recessions are recessions. Like a very strict diet for the morbidly obese, they hurt. The consequences of not having them are as destructive as not removing last Thanksgiving’s extra ten pounds and adding to those pounds each and every year.

AIG – to big to fail. Freddie Mac – too big to fail. Fannie Mae – too big to fail. Banking – too big to fail. Auto industry – too big to fail.

Speaker Please-O-See-Me says she and Bush must help the auto industry. If not, the dominoes fall. The small business owners make the parts. The unions put the parts together. The auto credit industry lives and breathes off those extraordinary high prices when it gets to the lots. The advertising agencies need the revenues generated on autos to keep the companies open – they don’t have beer, wine or cigarettes any longer. NASCAR without Detroit – impossible. Yes the auto industry is big but can we afford to leave it sitting on the couch staring out the windows instead of on the treadmill?

The unions must help. According to Blue, a Ford think-tank for making small cars in the US, they can’t afford to make them in the US with US labor and costs of production. Frankly, unions have outlived their life. They need to change or die – preferably before they drag us all down. Someone needs to see the math on this. What good is a $50 an hour job with huge benefits and pensions if the company is bankrupt and crushed out of existence? It is all about the bird in the hand and the one in the bush.

If a company is too big to fail, does it not make business sense to start splitting the profitable parts off into manageable companies and let the rotting pieces fail. The 80’s were about merging and diversifying. Now we need to be looking at splitting and chopping. There is a point that big is not beautiful and it will kill you. We are there.