The nation voted last Tuesday with no less than a dozen or more critical issues to decide before selecting a new leader. Rarely have we as a nation faced a time where the path of history hits the proverbial fork in the road.

Front and center is the fundamental role of government with respect to the economy. What is the role of regulation? What about government intervention in capitalism? Should the country take ownership of critical corporate endeavors?

These are complicated issues no doubt with no easy answers. While the election provides a glimpse into the general direction of the country, many details remain.

It is mind numbing to think about the momentous challenges that need to be addressed with so little time to address them. One moment all is well and the next thing we know Wall Street is collapsing and Congress is passing legislation for a $750 billion economic rescue package.

Free market economy slams head on to the reality of failure. We all love the benefits when the market is functioning well, but what about the consequences. Can you handle the truth?

Seeing what transpired in the banking and financial sector, the auto industry is now stepping up to the feed bag. Since you are already handing out so many gifts, why not throw a bone to us up here in Detroit.

This no ‘crying wolf’ either. We deserve as much money as you can afford to give. We are in serious trouble here.

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Indeed, the auto industry is a complete wreck. Its strategy of building gas guzzling, but high margin trucks and sport utility vehicles failed to consider that rising oil prices may negatively impact demand.

In addition, the industry became drunk on easy financing including zero down leases for customers regardless of credit. Sales were artificially high as a result of readily available credit.

That credit evaporated with the freeze in financial markets. Product inventory combined with fewer consumers and an inability to finance purchases crushed sales. The automakers saw volume decline by 30% or more in the month of October alone.

The industry was not all that healthy to begin with. Already struggling with legacy costs, and union battles, Detroit could hardly afford a huge decrease in sales.

Balance sheets laden with debt required cash flow. Without as much cash, the reality of bankruptcy became very real. Should weak conditions last long, auto makers as we know them today would be non-existent.

If you listen to management and politicians such an end result would be disastrous. The auto industry is critical to the nation’s economy or so the argument goes.

Give us money or give us death!

Hold on there tiger. Indeed the auto industry is important to the health of the economy, but a Chrysler style bailout spearheaded by government loans would be the wrong way to go in this situation.

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In my opinion there should be zero dollars provided to Detroit unless huge benefits accrue to the taxpayer. I’m not talking about a paltry interest rate or simply being paid back on the loans.

Instead, the only bailout that should occur here is one whereby current equity holders are wiped out replaced by the United States of America. Hey if we are opening the doors to socialism, let’s just go all the way.

In addition, funding should be provided as long as Detroit becomes a vested partner in our move away from fossil fuels. If that means sales are fewer in the short term, so be it. I want to see a viable alternative energy solution here.

That might require the government to provide investment beyond Detroit for things like infrastructure for a hydrogen powered vehicle. Don’t just think of this as a bailout of Detroit, think of this as part of a comprehensive alternative energy plan.

Heck we may even get the funding for this with an oil company windfall profits tax.

A bailout of Detroit needs to be part of a very comprehensive plan. Simply throwing dollars at Detroit in the form of a loan would be disastrous in my opinion. Management at the automakers is what caused this problem and rewarding them with a bailout would be wrong.

Bringing the government in as a partner would result in real change and real results. Everything should be on the table.

Whatever course the government takes should result in a complete loss of equity at both General Motors (GM) and Ford (F). I would avoid these stocks irrespective of any government intervention.

This article was written by Jamie Dlugosch, contributor to InvestorPlace.com. For more actionable insight like this, go to: www.InvestorPlace.com.