Wednesday, November 12, 2008

Let the Big Three Automakers Go Bankrupt

Barely a month after President George W. Bush, the Democrats in Congress and most of the Republicans in Congress bailed out the financial services industry with a $700 billion handout, every other large industry in the country is standing like a pathetic beggar with a hand out, demanding that the Federal Government do the same for it that was done for the resort going AIG executives and the dopey mortgage lenders.

Now comes the American auto industry, whining for $50 billion to save it from four decades of stupid management decisions, greedy unions, and marketplace tone deafness.

Nancy Pelosi, Harry Reid, and presumably Barack Obama can't wait to give these failures some of the money earned by average Americans and successful small businesses, sent to the Federal treasury because it is "fair."

What's fair about an economic system where UAW line workers have for decades been paid three or four times more than their market value ?

What's fair about you and I paying for the outrageous health care benefits given to these UAW line workers by cowardly auto executives ?

What's fair about propping up companies that make mediocre products that the marketplace doesn't seem to want ?

What's fair about you and I helping to pay arrogant executives hundreds of thousands, even millions of dollars a year as a reward for three decades of bad decisions ?

I say let General Motors, Ford, and Chrsyler go bankrupt.

Let those corporations sort out the consequences of their foolish commitments to financial obligations to workers they knew were not sustainable.

Let some capitalistic entrepreneur with a brain purchase the assets from these bankrupt corporations for pennies on the dollar, and let that entrepreneur figure out how to make products using those assets that the market place values.

What we need is the creative destructionism of capitalism, the kind of which the economist Joseph Schumpeter so ably described.

We don't need politically induced corporate socialism.

We have an economic structure today in which the politically connected are given outrageous and unfair benefits at the expense of the politically unconnected who do the most to actually create value -- the small businesses of America.

Time for conservative politicians of principle to show a little backbone, and not get rolled by the whiny politics of failure promotion.

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