Partly-baked ideas:  There was once a column (now, alas, no more) in a magazine I read entitled "Partly Baked Ideas".  These were random ideas tossed out by the writer -- not fully thought through, but put out there to stimulate further thought or discussion.  I don't know if any of them ever became fully-baked ideas or if any went on to real-world application, but I don't care.  Just the idea of someone tossing out ideas (and there were usually a dozen or so each issue) for others to pick up on was, to me at that time, unbelievably cool.

You might say Toad Hall is a place for my own partly-baked ideas.  (Actually, you might say that about anyone's blog.)  So here's one of my own.

Saving General Motors:  No, this isn't a sequel to Saving Private Ryan.  I recently read that GM is looking at going into bankruptcy.  Now, we know there are several types of bankruptcy, identified by the word "chapter" and a number.  The two this article talked about were Chapter 11 and Chapter 7.

Chapter 11 is the type of bankruptcy used by companies who want to keep in business but can't handle current debts.  Chapter 11 allows them to continue doing what they do.  Now in the case of manufacturing companies like GM, the company can continue to purchase the parts needed to make their wares via loans known as "debtor-in-possession" (DIP) loans.  Here's the problem, though:  Due to the current financial crisis, banks are either unable or unwilling to make DIP loans to anyone.  No DIP loan, no ability to purchase parts, and thus no production, and thus no income.

Which leaves Chapter 7 bankruptcy.  This is the one where the business goes out of business and sells off its assets.  The bankrupt company no longer exists.

In the case of GM, this is not a good thing, based on the number of people employed plus the number of peripheral businesses (all those parts makers, plus dealerships, plus garages, plus many others) depending on orders from GM to survive.  So what to do?

PBI:  The government has allocated $700 million to bail out the banks.  The Treasury Secretary, Henry Paulson, has recently decided to change the original concept of how to use this money and is starting to do something else with it.  So this $700 million appears to be in a very flexible spending account.

Take some of it -- say, $5 to $10 million -- and set up an agency that will provide the DIP loans to GM (and the other auto makers, should they need it down the road).  Set reasonable interest rates and repayment schedules.  Don't replenish the pot -- once the money's gone, it's gone.  But give the automakers the chance to change from what they've been making (which the public doesn't seem to want) to other, more in-demand types of autos.

Chrysler got bailed out, years ago.  They were able to change direction, stay in business, and repay their loan ahead of schedule.  Why not try it again?