Tuesday, November 4, 2008

Detroit's Turn?

A New York Times editorial endorses a government bailout of the big three automakers — even though there's a good chance they might eventually go out of business anyway — because the country can't handle another economic disaster at the moment. And who knows, they just might survive.

But there should be some conditions on the bailout:
"For starters, Cerberus has to open up Chrysler’s books and the rest of its finances to government inspection to make sure taxpayer money isn’t just funneled elsewhere in the opaque private equity firm. Ford and General Motors don’t pay dividends these days. We don’t know if Chrysler does. They should all be barred from paying dividends until they repay any taxpayer money they get.

"The money should also come with limits on executive pay and golden parachutes. The top executives of the car companies should be required to step down; taxpayer money should not be used to underwrite proven managerial incompetence."

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