Why I Support Bailing Out The Auto Industry

I just heard some bad news. The company next to us (or a branch office of the company) today laid off 40% of its workforce. They did business relating to the automotive industry. This kind of brings the automotive bailout question from the abstract to the more personal level for me, so I'll make a few comments.

Here are the typical arguments I hear against bailing out the automotive industry-

• Let the market decide, govenment shouldn't be involved
• The big three won't go away, they will just go into bankruptcy and reform
• The big three's managment sucks
• The unions are to blame

Ok, ALL of the above arguments are valid, except the first one. More on that later.

Here are the arguments I hear for bailing out the auto industry-

• The auto industry provides hundreds of thousands of jobs both directly and indirectly
• National security arguments for having a domestically robust production base
• My aunt/uncle/brother/cousin/myself work for the auto industry (self preservation/interest).

I'd say the first two arguments are valid, and I sympathize with the third.

Here is one big arguments that isn't being discused.

• The big three do not have access to other countrys' markets like other nations have to ours.
• We are sick of bailing shit out. First the banks, now this? When is it going to stop? Let's stop it now.

I think Pat Buchanan brings up some great points in the debate as well (note this isn't an endorsement of everything PjB says, though I do think he is a brilliant thinker).

http://buchanan.org/blog/2008/11/pjb-as-gm-goes-so-goes-the-gop/
http://buchanan.org/blog/2008/11/pjb-who-killed-detroit/

So here is my take. If the freak'en government is going to piss away a trillion plus dollars on protecting their bro's and ho's in the banking industry, why not give a little to an industry that provides jobs, technological innovations, an industrial base that can be called upon in times of war. This is a stark contrast to what was given to the banks...which will all evaporate into rich fuckers overseas accounts.

Right now a 15 billion loan is being battered around...I think that is a modest start. I don't think Detroit should get a free ride...there should be string attached to the purse, but open the purse.

The money will not fix Detroit, but it will buy time so trade policy, unions, andy shitty management problems can be addressed.

So I'm in favor of an initial bailout of the auto industry provided that systemic issues are addressed.

And to all you free market purist out there, educate yourselves. We don't live in a free market world. We live in a world that is more based on merchantalism. Read up. And also fire yourself from any position of corporate or public governance.