"bridge loan to nowhere"

The title of the WSJ editorial this weekend, updating the auto bailout proposals...

Once upon a time -- about two weeks ago -- GM, Ford and Chrysler came to Washington to seek emergency financing. Congress sent them home empty-handed but gave them some homework: Give us a plan to restore your businesses to viability, and then we'll think about giving you a loan.

This week, the Detroit Three were back, plans in hand and determined to show that they were appropriately chastened. In the interim, their need for taxpayer cash grew to $34 billion from $25 billion -- and GM said it needs $4 billion just to make it to Christmas. But instead of viability, what they've come up with is green political correctness....All three restructuring plans are heavy on promises to build the "green" cars that a Democratic Congress wants built....

If there was ever any question whether Congress actually wants to "save" Detroit, this week dispelled it. This is not a bailout that Congress is debating. It is a federal takeover. We don't mean that in the sense that the feds will own the companies on paper, although that can't be ruled out. What Congress wants to own is their business plan, and Detroit seems prepared to oblige....

Yet amid all the hopeful talk about the brave, new green car world, the men from Detroit were studiously silent on whether they can sell these new cars at a profit any better than they can their current lineup. Yes, the restructuring plans, especially GM's, have some stark numbers about downsizing...But it's hard to see how that gets done without a bankruptcy judge to tear up the contracts and start over. Once the auto makers agree to let Barney Frank run their businesses, does anyone really believe organized labor will roll over and let them gut the United Auto Workers?

The core problem is that the companies can't pay their creditors in fuel-economy standards....

The car makers' request for a bridge loan, by contrast, looks like a $34 billion bridge to nowhere. It has already morphed into an opportunity for political extortion -- and we don't even have a bill yet. When, in a couple years, costs have not come down as expected because of political pressure to keep the unions happy and the green cars aren't selling -- because they were designed in Washington, not for consumers -- the companies will be back for more money....

This fairy tale, in other words, does not end happily ever after. A bankruptcy, prepackaged or otherwise, keeps looking better.