If We Didn't Bailout Detroit

The bailout plan is going to allow the federal government to dictate many of the business decisions of the Detroit auto industry in exchange for money. Essentially, the government will be playing the role of an entrepreneur, to some degree, in getting these companies back on their feet. But what if we had an actual successful entrepreneur do it? Robert Cringely over at PBS wonders what Chrysler would look like under a Steve Jobs (hat tip Barry Ritholtz):

In this scenario, Chrysler becomes a design, marketing, sales, and service organization. What’s wrong with that? They can change products more often and more completely because of their dramatically lower investment in production capital. They can pit their various suppliers against each other more effectively than could a surviving car manufacturer. It’s what Steve would do.”

Of course, no one is seriously suggesting that we should draft Jobs into that unenviable position. But would that really be crazier than what Congress is now poised to do?

Critics of the bailout plan have been saying for awhile that it only hurts the U.S. economy more to prop up failing industries, instead of allowing entrepreneurs to improve the old models. Cringely's thought experiment shows that there can be hope for the auto industry if we allow smart, risk-taking people who can think outside of the box to transform it.

Does anyone seriously think that Congress is made up of those people?