After The Banking Bailout, Can Congress Let GM Go Bankrupt?

Posted on November 16, 2008

0


We’re starting to see a pattern here, in the way the U.S. government responds to crisis situations.

Consider:

  • New Orleans — Hurricane Katrina assistance
  • New York City — Wall Street bailout
  • Detroit — Auto Industry collapse

Is there a hint of classism in the magnitude and urgency of the government response, depending on the wealth and status of the people who live in a particular city? It’s probably just my paranoid imagination.

As a general rule, I’m not in favor of the government rescuing a business or industry that has failed in the marketplace. And if the U.S. steps in to save General Motors, where does it all stop?

But the industrial base of the U.S. has already been hollowed out, taken apart, and shipped overseas, one factory at a time. The automobile industry, with assembly plants and parts suppliers in many states, is the largest remaining business that produces tangible products in factories. Please correct me if I’m wrong. If the auto industry fails, is that the end for Made In The USA?

And what about the plight of middle-class workers? The autoworkers are the largest remaining group of middle-class factory workers in America. If you don’t have sympathy for the unionized autoworkers, who have a history of being fairly paid, think of the cascading effect on all other members of the middle class and the working poor. If the auto industry fails, is that the end for the American Dream?  — Bernie Hayden

Advertisements