For Immediate Release Saturday, December 6, 2008
The Libertarian Party Says: “No.”
The ‘Big Three’ are back on the Hill, and this time the question is whether they can make a strong enough case in order to receive billions of dollars in taxpayer-backed loans to save their companies from bankruptcy.
Despite all the trappings of a truly repentant lot of CEOs who just got a bad shake (this trip, they substituted their private jets for hybrid cars), there is no case that they can make that will be strong enough to justify even $1 being used to prop-up their failed companies.
These ‘billion-dollar beggars’ deserve to go home empty-handed.
Detroit auto manufacturers have failed to keep up with trends in the automotive industry, locked themselves into destructive union contracts and demonstrated a complete lack of initiative in automotive innovations that make their products enticing to consumers.
Why are taxpayers being forced to reward this mismanagement?
Bad business decisions — not economic downturn — are the reasons these CEOs find themselves in their current plight. A bailout would only subsidize these bad decisions and offer no incentive to dump the individuals responsible for this mess in the first place. Bailouts do absolutely nothing to encourage reform.
Just look at Chrysler, who asked for their first bailout only three decades ago.
Taxpayers should not be responsible for the American automotive industry, which trail its foreign competitors in almost every category, and has allowed itself to be strong-armed into destructive union contracts.
The United Auto Workers union may be willing to play ball right now (its more of a matter of self-preservation that any true sign of goodwill), and CEOs may be promising to make changes, but the truth is that these reforms and concessions will only be around until the auto industry gets back on its feet. Then, it’s back to their old tricks until the Big Three come crawling again to Washington a few decades down the road looking for another ‘fix’ of corporate welfare.
It may seem counter-intuitive to take such a bold move as saying ‘No!’ to the bailouts (bold, as in Congress actually listening to the 61 percent of Americans who oppose the bailouts for Detroit) during the current economic slump, but short-term anguish is worth it to prevent the long-term suffering that will come from a bailout.
So, to answer the original question: No, the Big Three have failed to make a strong enough case for a bailout. They were doomed, in principle, from the very beginning .
Originally published at The Hill …