House Democrat leader Nancy Pelosi is eager to give the auto industry $25 billion to help them avoid looming disaster. And why not? How about we simply give them blank checks and have them tell taxpayers what they need? At this point it’s all funny money and it’s all a joke anyhow.
If Conservatives are going to come back from oblivion, support for this type of spending needs to end. I am hopeful that President Bush will not mark his final two months by approving a bailout for Detroit on top of what’s already been done for Wall Street.
Companies who produce poor products that don’t sell tend to fail. And that is as it should be. Bailing companies out will only prolong the agony and delay the inevitable.
The previous bailout, which I absolutely did not support, at least had a case. When credit markets freeze up, an economy can go into a tail spin very rapidly. A credit freeze negatively effects business across industries. It has potentially wide ranging consequences. Having said that, again, I did not and do not now support it. I don’t know where the $700B figure came from for that. And I don’t know why it had to be done in warp speed.
However, bailing out specific companies and industries is beyond indefensible. Jobs will be lost in the American auto industry and they should be. They lack vision, produce poor cars, and have too high a cost structure to compete. Government bailouts of this sort sets a precedent that is frightening. This is not bailing anybody out. Instead it just prolongs the necessary pain and delays the eventual remedy.