Time to get tough

It had to happen sometime. Finally government gets mad at all these damned companies asking for bailouts and handing out bonuses. Finally Washington is asking hard questions, setting hard deadlines, and getting tough. With the financial companies? God no, what are you, high? We've decided to take a couple of beaters from Detroit, paint AIG & Citibank logos on them, add in a big picture of Joe Cassano on the hood and start beating them with baseball bats in a furious rage.

The White House on Sunday pushed out the chairman of General Motors and instructed Chrysler to form a partnership with the Italian automaker Fiat within 30 days as conditions for receiving another much-needed round of government aid.

The decision to ask G.M.’s chairman and chief executive, Rick Wagoner, to resign caught Detroit and Washington by surprise, and it underscored the Obama administration’s determination to keep a tight rein on the companies it is bailing out — a level of government involvement in business perhaps not seen since the Great Depression.
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If a deal is reached between Chrysler and Fiat, the administration says it would consider another loan of $6 billion to Chrysler.

G.M., on the other hand, has made considerable progress in developing new energy-efficient cars and could survive if it can cut costs sharply, the task force reported. The administration is giving G.M. 60 days to present a cost-cutting plan and will provide taxpayer assistance to keep it afloat during that time.

Why the different track with Detroit? Two reasons: 1. It's easier to sell steel, car building robot slaves, and surplus car doors in a bankruptcy than it is useless bullshit like credit default swaps. 2. The dumbass CEO's from Detroit didn't even threaten to pull down the entire economy with them or claim that they needed to be retained because only they knew how to fix the problems they created. This is the lack of innovation that has been crippling Detroit for years.

People from within the Administration also seem to be mad that Detroit hasn't fully lived up to its loan related promises. How is this different than the financial institutions? Well, no one from the Treasury Department or Obama Administration spent time working their way up the Detroit ranks, has any friends in the car industry, or is partially to blame for the mess in Detroit. So they can wail on Detroit without any future awkward social situations/uncomfortable cocktail parties or yet another reminder that they've spent their life working in an industry with no redeeming societal value.

So congrats Detroit, you get to feel the wrath of a government scorned. It's not your fault, you just look like AIG when we squint our eyes a bit. We'll put this in the "right idea, wrong reason" file.