No to Bailout of Automobile Manufacturers

It has been about two months since Congress enacted legislation authorizing $350 billion for use by Treasury Secretary Paulson to address woes in the financial and credit markets. Many across the nation were opposed to this bailout of monied financial powerhouses for a number of various reasons, mostly on the belief it was unfair, wrong, and questionable as to whether ist would do any good. This writer strongly reluctantly agreed to support the concept. And unfortunately, the fears by many seemingly have been realized. The money authorized in the legislation signed by President Bush has done nothing to even minimally revive the economy, and much of the money has been squandered by banks on executive bonuses and perks, acquisitions of competitors, and other wasteful and unproductive activities. As each day passes, more and more of the public continues to reverse their prior support for the first bailout package.
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The original purpose of the bailout legislation was to address real estate loans inventories that were extremely troublesome for the financial markets. But Paulson has waffled and seesawed on the plan he wants to employ, and now his strategy is to give banks money to address bad consumer debt that is largely unsecured. Clearly the approach on trying to address the ongoing financial collapse by Treasury officials and the Fed has been completely unproductive and largely wasteful. And as each day goes by, things are getting collectively worse.
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Now the Big Three automobile manufacturers have come to Washington DC with hat in hand asking for an indeterminate amount of money for largely unknown purposes. This industry has been in a long slow decline for decades and has been marked by extremely poor management and seriously flawed business plans. The products they put out are clearly inferior in quality and value relative to competitors.
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This writer believes Congress just needs to say "No" to Detroit. It would be far better for these three dinosaurs to fall into bankruptcy. Out of that process would emerge manufacturers better able to compete and produce quality motor vehicles of value. Maintaining the status quo with an input of federal taxpayer cash is just delaying the inevitable. The Big Three are corporations of yesteryear and incapable of moving their businesses into the 21st Century with alternative fuel vehicles that are quality built, at a fair price, and capable of meeting consumer demands and expectations.
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While there is a substantive risk GM and Chrysler are likely to go into bankruptcy and very well may disappear completely from the landscape, the idea of throwing federal taxpayers dollars at this troika of losers is absolutely the wrong thing to do, and especially given the current overall economic circumstances and environment we are now in the midst of and will be for the coming 18 - 24 months at least. It is a far better idea to let these two fail rather than keep their sick diseased carcusses on life support through the use of a taxpayer funded bailout.
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George Will says much of what I believe in his comments in the link below.
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http://dailymail.com/Opinion/gwill/200811190171
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