House To Bail Out Automakers
Speaker of the House Nancy Pelosi said Saturday that the House of Representatives would bail out the long ailing U.S. auto industry.
Although the news will undoubtedly make automakers and their employees happy, there will be strings attached: the House will require ‘that the industry meet new fuel-efficiency standards, produce advanced vehicles and restructure “to ensure their long-term economic viability.”‘
Pelosi neglected to say how much automakers would receive, but it is known that they asked the government for $25 billion in loans.
We do know that the money will come from the $700 billion bailout plan approved by Congress several weeks ago in order to save the economy and then especially financial institutions.
“A restructured, competitive American automobile industry will continue to play a crucial role in our national economy and in the global marketplace,” Pelosi said in a statement.
The problem, of course, is that U.S. automakers are not and have not been competitive for years, decades even. Unions and the government force them to pay employees too high a salary, driving up production costs and the prices of the product, cars. The only way for U.S. automakers to sell cars is to sell them against no profit.
Since they do not make a profit they do not have the right to exist in a market economy. Yet, they are bailed out time and again because ’so many people depend on them.’ Yes, and if you keep bailing them out, even more will come to depend on them, costing the taxpayer even more billions every couple of years, and weakening the U.S. economy even more. If Americans continue to work in a dying sector because the government ‘helps’ the sector out, it does tremendous damage to the innovation ability and growth ability of the U.S. in other areas: if these people were all forced to work in other sectors, as the market dictates, the U.S. economy would be better off, for they would be competitive in this areas.
The more the U.S. government bails out dying industries, the more likely it is that it will lose its edge over up and coming economies such as India and China.
I think we best be getting on with the promise of making America energy independent.Iran just asked OPEC to reduce production by yet another 1.5 million barrels per day.This past year and the record gas prices played a huge part in our economic meltdown and seriously damaged our society.We keep planning to spend BILLIONS on bailouts and stimulus plans.Bail us out of our dependence on foreign oil. Make electric plug in car technology more affordable. It cost the equivalent of 60 cents a gallon to drive an electric plug in car. The electric could be generated from wind or solar. Get with it! Utilize free sources such as wind and solar. Stop throwing away money on things that don’t work. Invest in America and it’s energy independence. Create cheap clean energy, create millions of badly needed green collar jobs. Put America back to work. It is a win-win situation. We have to become more poractive citizens, educate ourselves and demand our elected officials move this country forward into the era of energy independence. Jeff Wilson’s new book The Manhattan Project of 2009 Energy Independence NOW outlines a plan for America to wean itself off oil. We need a plan and we need it now! http://www.themanhattanprojectof2009.com
boy - wonder if Congress will try to make it actual, effective mileage standards this time - since they utterly failed with cafe.
- somehow though I do not think they will
Any financial help is necessary for them. Indeed these automakers need any financial assistance and support all the way to make greener cars for the future. But the problem lies on how to boosts sales again.