Too big to fail?

Barbera warned that opposition to lending either the $17 billion agreed to – or to the $34 billion that the car companies originally requested – could result in stock markets plunging by hundreds of billions of dollars. And that does not include the billions of dollars in unemployment insurance benefits and pension bailouts that would be required to assist not just the displaced auto workers, but also the many other workers, from truck drivers to waitresses, whose jobs depend on the Big Three.

“There will be tremendous regret if we don’t help them avoid bankruptcy in the next few weeks or months,” said Mark Zandi, chief economist with Economy.com. “If they go into bankruptcy now, they’ll go into liquidation and there will be the loss of hundreds of thousands, if not a million jobs – on top of the four or five million we’re going to lose. That will add almost a point to unemployment by itself.”