A road map for Detroit

•Don't allow mergers. A long history of failed ones (remember Daimler-Chrysler?) shows that more scale is the last thing they need.

•Fully fund unemployment insurance and healthcare for all affected workers – but make those benefits contingent on enrollment and success in retraining programs, so that they get the skills relevant to better-paying, more secure jobs.

•Then, provide the $25 billion in loan guarantees, with the government first in line to be paid back – in exchange for company stock with voting rights and board seats, to be held by a public-interest troika: a new "auto czar," plus the secretaries of Labor and Commerce.

Customers will initially be leery of purchasing anything as significant as a car under the stigma of bankruptcy. But revitalizing board and executive leadership – and funding and guaranteeing warranty service through recognized national service chains – will send the right signal while they reorganize.

How to get Republicans on board

Congress may vote as soon as Wednesday on legislation. House Speaker Nancy Pelosi (D) of California and Senate majority leader Harry Reid (D) of Nevada could generate more support across the aisle by ensuring restructuring and accountability along with any loan guarantees.

Republicans, who would consider a Chapter 11 filing more adequately bracing and focusing, might sign on in greater numbers – perhaps enough to get it done this week.

Signs of renewal

It turns out that what we make – profitable products, persistent and happy customers, personal income – all depends on what we know. Which means that education and retraining of the local workforce is the most pivotal partnership the public sector has to make with business.

Drive just two hours west of Detroit, and you'll find the effervescently named Kalamazoo, which now appears, remarkably, to lead the nation in per-capita job creation. A long series of business expansions and arrivals here have been prompted by the town's vision for "The Education Community." Robert Miller of Western Michigan University announced at a panel discussion this month: "This community is not going to participate in the recession." I wouldn't bet against him.

Area employees are expected to volunteer four hours a month in learning-related service projects. A scholarship program called "The Promise" has become a business catalyst for improving schools and local colleges, bettering quality of life in low-income neighborhoods, building employer and investor confidence, and creating jobs.

"Don't sell it as a scholarship program," Ron Kitchens, CEO of the economic development agency there, told The Kalamazoo Gazette. "It's about building infrastructure for the future. If new job creation is at the top of the pyramid…, the base is education." That is as true for unemployed auto workers today as it will be for their kids.

Reject false choices

During the summer of $4 gas, consumers sent the automakers a clear message: We don't want what you're selling. In response, Chrysler offered a $2.99 gas guarantee. While the price of oil has dropped, most observers expect that it will climb again.

For Congress, the choice being debated is a false one: Subsidize failure through a bailout of existing management, under unmanageable contracts and constraints. Or let the automakers crater, and let all involved with them suffer.

Voters are incensed by the Wall Street bailout because it has done everything but enforce accountability to the public.

There is a way, if there's the will, to demand and reward reorganization and management accountability while we commit public money to save the US auto industry – and give our workers the training and education they need to succeed.

• Mark Lange is a former private equity executive and presidential speechwriter.

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