Weekend At Bernie’s did when Bernie died, the government is going to keep propping up a dead body in the hope that no one notices.
The best thing, long-term, that the government could do is to let the auto manufacturers fail. Yes, that would create massive problems now, but who are they kidding? They are going to fail eventually.. it’s just a matter of time.
Instead, they’ll keep throwing good money after bad, and eventually end up in a bigger mess than we’d have if they just stepped aside and let market forces take effect. Government interference in business is never good, and this is one area that is going to prove this theory again at some point in the future.
I’m a firm believer in the free market, and if they actually let them fail, then new owners would come in and figure out how to make MONEY making cars. What a concept! Yes, workers would get lower wages, and yes there would be economic consequences — for now. But eventually, those factories would either be bought by companies who CAN make money making cars, OR they would be re-tooled to start manufacturing things that people actually want.
The problem is, this so politically suicidal, you won’t see the government do this any time soon (let them fail, I mean.)
So, in honour of the government’s bailout of the auto sector, (and several more to come I have no doubt), I provide you the most succinct view of the what causes bailouts that I can.
Enjoy.
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