The continuing economic upheaval is threatening to claim another victim: the domestic automobile industry. Without help, General Motors Corp. could run out of cash by January. Ford Motor Co. and Chrysler L.L.C. also need quick government intervention to stay solvent.
The automakers and the United Auto Workers union are making their case for emergency assistance from Congress this week. But even those who support a $25 billion aid package for the industry have doubts about whether they have the votes to pass it.
This raises the question: Why not just let the automakers go bankrupt?
The domestic auto industry is a favorite whipping boy. Its problems have been growing for decades. Some are of its own making; others are circumstantial.
But we cannot blithely accept its failure as somehow inevitable or deserved.
Our economy has been badly battered in recent months, and it has become increasingly fragile. The erosion of our industrial base already presents real security risks for our nation. Why would we accelerate this national crisis by sitting on our hands and letting a signature American industry collapse?
The American auto industry is well worth saving for many reasons. One is that, for the last decade, Detroit has made heavy investments and steady progress in improving its competitiveness - in what some in the industry call "altering the DNA" of American cars.
U.S. automakers spend $22 billion a year on plants, equipment, research and development. Breakthroughs are at hand in developing alternative-fuel propulsion systems, and our national well-being and security depend on seeing them through to completion.
If, out of anger, resignation or ideology, we allow American automakers to go under, it will only mean that all the work and investment of the last decade will be ceded to our foreign competitors, instead of being plowed back into the American economy.
Another reason for helping the auto industry is its importance to the job market and the wider economy. The effects of a collapsed U.S. auto sector would not be limited to Detroit. They would be magnified as the ripples spread to related industries.
Automobile manufacturing directly employs a quarter of a million workers. Nearly a million additional jobs closely related to the automotive sector would be lost should the automakers fail. And an additional 1.7 million jobs would be sacrificed as reduced spending worked its way through the economy, according to the Center for Automotive Research.
Not only would the auto-manufacturing jobs disappear, while undermining millions of retirees depending on auto company pensions, but many jobs in related sectors also would be threatened. The steel, aluminum, iron, copper, plastics, rubber, electronics, and computer-chip industries all would feel the pain.
Worse, the possibility of a meaningful future for American manufacturing would fade. And manufacturing jobs would cease to offer a passport to the middle class.
The auto manufacturers did not cause this crisis. They were working hard to reinvent the quintessential American invention when high oil prices and economic upheaval hit, dragging them into the vortex.
There is a tendency to think that an example must be made, that someone must be allowed to fail. But do we really want to cut a key industry out of the heart of the real economy?
When the patient is in the middle of a full-blown heart attack, it's not time to discuss lifestyle changes. We can and should revisit subjects like executive pay scales and expense controls when the industry isn't at death's door. For now, though, we should recognize the gravity of the moment and head off further calamity for the national economy.