Here's the reason NOT to do the Big 3 bailout
Again, as we talked about this on the show yesterday, the question is whether or not the Big Three should get the $25 Billion bailout - none of us thought it was a good idea. Why? Well, look at this:
Until costs are brought into line (as defined as being able to make a profit vs the competitors), Ford, Chrysler, and GM will fail. They are NOT relatively more productive so as to say that the premium wage level is justified.
The big argument for the bailout is that it will save millions of jobs. Well, if our domestic car makers go out of business for failed management (and the "killing the golden goose" syndrome), won't that mean that we'll just buy cars from somebody else? The foreign manufacturers that have plants on our soil? Which will mean that those plants will have to expand and be supplied.
And if the worry is PURELY about jobs, the market will create them.
Trying to forestall this, like the Brits tried with British Leyland, is just an exercise in futility. Mark my words, you'll be able to blame the Democrats for just blowing $25 billion of YOUR tax money with no attributable benefit at all.
You know, I bet I could make more productive use of all that money - temps are going down here in central NH - I could heat my home with all those $1bills - at least one taxpayer would benefit from that money.....
(H/T: Greg)
