Consequences of Bailouts
Friday, December 12th, 2008 | Author: JL

Joe solerno is interviewed by Lew Rockwell about the Auto Bailout Bill — which did not pass — and the economic consequences of bailouts in general.

A few additional thoughts:

  • I thought Democrats were supposed to oppose corporate welfare. Why then do they want to take hard earned money from productive members of society and give it to behemoth corporations who are unable to produce products that people are willing to purchase at a price that results in a profit?
  • I thought Democrats did not subscribe to the “trickle down” economic theory. Why then do they insist that failing to bail out the giant auto companies will hurt blue collar workers?
  • If there exists a market for cars (i.e. people want cars) beyond what the remaining car companies can provide, the bankruptcy of and combination of Ford, Chrysler, and GM will not make their capital and jobs disappear. As with any other sector of the economy, a transfer of ownership will take place from the incompetent who cannot meet market demand (without theft), to the competent, who can. If they are allowed to fail, as they should be, there will undoubtedly be hardships during the transition, but the consequences of the alternative are much worse.
  • Criticisms of the viability of the Detroit auto companies — and the quality and efficiency of their cars — are usually met with facts about how many cars they sell. Well, I could probably run a car company and sell decent cars too, if I didn’t have to worry about making a profit, and could rely on taking (stealing) tax payer money to fund my operation.
    • One Response
    Follow responses through RSS 2.0 feed.
  • Ria Rogers says:
    December 12, 2008 at 7:41 pm

    I’m unable to comment on here so far. I’ve pasted and pasted and nothing happens.

    Leave a Reply

    XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

    « Mises on Sub-Prime Lending
    Steel Tariffs Hurt Consumers »