Is General Motors too big to fail, or just too big?

Romm singles out GM for particular scorn. The company once held the technological lead in electric drivetrains, but instead of taking advantage of this lead, GM opted to pour millions of dollars into lobbying efforts against stricter fuel economy standards so that it could continue to sell its behemoth trucks and SUVs.

Now Toyota and Honda have a 10-year head start on hybrid drivetrains, and the companies say that the costs of producing hybrids could drop by two-thirds over the next decade, but of course only for companies that have the experience making them.

Had GM's shortsighted executives been at the helm of a much smaller company, then all of this would have simply been sad, not catastrophic.

But GM is the world's second-largest automaker (it was overtaken by Toyota this year). When it seeks to block Congress from raising gas mileage standards, when it keeps churning out gas-guzzling suburban tanks instead of innovating safe, fuel-efficient vehicles, and when its vice chairman tells reporters – this year – that Toyota's hybrids "make no economic sense" (and then casually adds that the scientific basis of global warming is "a total crock"), these actions have far-reaching consequences. They influence what kinds of vehicles hundreds of millions of people drive, and what kind of air billions of people breathe.

Sure, all of the world's automakers are suffering to some degree. It's very hard to get a car loan these days. But not all are teetering on the brink of bankruptcy like GM. On Tuesday, as Congress debated the auto industry's request for a $25 billion bailout, Honda opened a new plant in Greensburg, Ind., to the cheers of more than a thousand US workers.

If GM goes under, perhaps Japanese, Korean, and German automakers could step in and make up for the lost jobs. But I bet I'm not the only one who would be demoralized by seeing such a large piece of America's homegrown auto industry transferred to foreign ownership, benevolent as it may be.

Wouldn't you rather see a flourishing of smaller US automakers like Tesla, Fisker, Aptera, and Commuter Cars? Companies that can take bold risks without threatening to bring down the entire economy? With the right incentives, these companies, and many like them, could determine transportation for the 21st century, just like Ford and General Motors determined it for the 20th.

And if we can't get smaller car companies, can we at least get smaller cars?

Previous

1 | 2