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Howes: Doomsday scenario is all too real
A doomsday scenario? Sure. Is the timing of its release, the day after the elections, intended to prod Obama and his Democrats into action? Of course. Does it give them some political cover? Yes. Could the worst be possible if Detroit's automakers are not able to access fresh liquidity to fund their operations and lend to would-be buyers? Absolutely, which is why a president-elect and his party are unlikely to ignore intensifying pleas to help Detroit -- even if doing so means angering environmentalists by easing deadlines for meeting new federal fuel economy regs. In the real world of real economics, which Obama and the Democrats in Congress will inhabit like they haven't in at least a decade, choices need to be made. Something's got to give. Amid the economic carnage threatening to engulf the North American industry, we also have an auto industry expected to spend close to $100 billion -- because federal law requires it -- to meet stiffened fuel economy rules on a fleet of new cars, trucks and crossovers. But oil prices are collapsing, gas is close to $2-a-gallon and the hysteria about driving small is being overshadowed by the real economic impulse to survive. Obama will face a welter of difficult choices. Few will have greater impact on Detroit's economic future than his ability to understand that there won't be automakers to meet federal fuel regs -- or the jobs, tax revenue and votes they provide -- if at least two (General Motors Corp. and Ford Motor Co.) of its automakers and their suppliers don't get some help to survive this vicious downturn. Otherwise, he and his party will own the implosion because that's how politics works. Daniel Howes' column runs Tuesdays, Thursdays and Fridays. He can be reached at (313) 222-2106 or [email protected] or detnews.com/howes.