Why a Big Three rescue is so hard
Congress can't be CEO to the industry's revival or to picking other market winners.
In deciding whether to bail out US automakers, Congress has set itself up as a venture capitalist. It demanded the Big Three reveal such data as "operating cash position," "callable loans," and "assumptions" of sales. But can lawmakers be CEOs? Under President Barack Obama, they best get used to it. Uncle Sam will become a Dutch uncle to budding businesses.
Mr. Obama has laid out big plans to use taxpayer money in picking winners in various industries, either by creating new jobs (2.5 million by 2011) or by investing $150 billion in clean energy technologies, such as solar and wind.
Next year, lawmakers will be asked to comb the financial prospects of many businesses and guess which ones might meet Obama's promise of government as the incubator of new jobs and sunrise industries. Under his plan, for instance, money will be spent to "support local manufacturers with the most compelling plans for modernizing existing or closed manufacturing facilities to produce new advanced clean technologies."
Americans may greet this Uncle-Sam-knows-best attitude with the same skepticism as a Detroit bailout and the federal buy-ins of Wall Street firms. Nearly 6 in 10 are against a rescue of the Big Three, according to a CNN poll. Letters to lawmakers reveal an angry majority that doesn't want to subsidize an industry whose executives have such a tin ear to public sentiments that they flew private jets to Washington for their first congressional hearing to beg for billions.