That taxpayers are never going to recover their "investment" in Government Motors has been a foregone conclusion for a while. But their losses are mounting beyond what many, including me, had predicted. Last year, top auto analysts had expected GM's … Continue reading →
Had the market been allowed to function naturally, GM would have been allowed to succeed or fail on its own. By forcing taxpayers to bailout the auto industry, the government is in effect subsidizing the industry and choosing some producers over others. If a producer is unable to market and sell its goods to consumers, bailing them out only encourages them to continue down a path of failure.
Employees can and must retrain into other fields when industries begging to collapse. It is not the responsibility of government to intervene and support failing industries. It only prolongs the painful need to transition. It really doesn't matter which political party is involved in the bailouts, they should all be independent of the economy and maintain a non-intervention policy to help the markets equilibrate quickly and effectively. By intervening, it only drags out the inevitable.
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