The Big Three Automakers are failing. In this bailout era, leaders have been to Washington begging for $25 billion to tide them over.  With millions of jobs at stake and a devastating ripple effect anticipated throughout the economy if they don't get help, commentators of all political persuasions are questioning whether bankruptcy might not be a better option.  Some, like MSN columnist Michael Brush, ask whether the companies should just close their doors as they have some deep problems money cannot fix.  The many internal problems in the companies, ranging from burdensome labor contracts to lack of ability to forecast consumer desires, are exacerbated by ever falling demands for American cars.  Even if the companies got bailout money, the fix might not be long lasting. (Chrysler got help before; here they are again!)

Nevada Senator Henry Reid has been a major supporter of immediate help to the industry.  Much is at stake as the auto industry declines; if the situation worsens or the companies disappeared, there would be major economic effects 

•· 240,000 autoworkers would be unemployed, possibly long term.  In the absence of other manufacturing facilities to absorb these workers, this would unleash them onto a service sector that could not absorb them all

•· Another 974,000 employees of suppliers would probably be out of work as their companies, captive suppliers for the auto companies, closed or downsized

• 1.7 million jobs created by the money autoworkers spend would be lost.  Realtors would take a hit, as would restaurants, retail, and consumer service providers

•· Cities dependent on tax revenue from auto companies and their workers would see a huge decrease in revenue.  As people lost their homes, property taxes that support schools would fall off as well.  With higher unemployment there is increased need for city services, with less money to provide them.  Obviously, the federal and state tax revenues would fall too.

•· Car prices for the foreign cars filling the marketplace would increase once the local competition was gone

While there may be structural problems in the industry, the price tag for any of these effects would far exceed  $25 billion.  

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