Why not bail out the Big Three?

Now that the U.S. has bailed out Bear Stearns and pledged to do the same for Freddie Mac and Fannie Mae, the Big Three U.S. automakers “think it’s their turn,” says the Los Angeles Times in an editorial. And why not? With nearly 250,000 U.S. employees, aren’t they, too, “too big to fail”? “The short answer is no, they’re not.” GM, Ford, and Chrysler are demanding $100 billion to compensate them for new fuel-efficiency standards imposed by last year’s energy bill. But consumers, as usual, were ahead of lawmakers in demanding better gas mileage, and way ahead of the Big Three. The fault for the U.S. auto industry’s fix lies with U.S. automakers. And like it or not, “the flip side of being free to succeed is being free to fail.”

Banking pain? Yes. Crisis? No.

We’ve all heard about the banking “crisis,” says David Weidner in MarketWatch, but really, “the facts don’t support the ‘crisis’ label.” Sure, this isn’t “a golden age for U.S. banks,” with lenders refusing to lend, a few teetering on the edge of collapse, and many more unsure of the value of their assets. But compared with, say, the savings and loan collapse, when 1,000 lenders failed, “the current banking crisis is comparatively mild.” The U.S. has about 7,200 banks with combined assets of $13.4 trillion, and the current failure rate is low by historical standards. “Banking is a cyclical business,” and this is a down cycle. But “it’s probably not even in the top 5” moments in bad banking. Hardly time to stash your money under your mattress.