In the wake of the Detroit Three zipping over to Washington to plead a case for a bailout (and I still can't believe anyone pulling down a salary as a spin doctor didn't foresee the private-jet fiasco), Nancy Pelosi and Harry Reid have sent them a letter outlining what they'll need to do in order for their request to be considered.
Much to my shock, the government's demands make sense. Mark that one on the calendar; people will be talking about that for centuries to come.
Among the things the automakers need to do:
- Provide forthright, documented assessment of the current operating cash position, short-term needs, and how they'll meet long-term needs;
- Provide varying estimates of the terms of the loan, tied in with assumptions of current, improved or worse sales rates;
- Report and share information with any government mechanisms designed to safeguard the loans;
- Ensure the taxpayers get paid back first;
- Address health care payments and pension obligations;
- And my favorite, bar the payment of dividends and excessive executive compensation, including bonsues and golden parachutes by companies receiving taxpayer assistance.
The only other question: why the hell didn't the auto execs fly into Washington with such a plan already tucked under their arms? I think we've all applied for loans, whether through credit cards or the bank, and we pretty much know what the loans officer is going to ask us. I've never run a multi-billion-dollar company and know I can't. But sometimes it scares me when I realize just how out-of-touch these folks on the upper floors can be.
