Kicking the bailout can down the road

Daniel Ikenson writes at The American: “The U.S. auto industry needs a shakeout, not a bailout. What we are witnessing is an attempted shakedown.”

He posits several interesting arguments in his essay. (Of course he did, right? Or we wouldn’t be bringing this to your attention.)

“The intellectual arguments against an auto industry bailout are well established. Taxpayers should never be forced to subsidize any company, let alone a poorly run company. Subsidizing the Big Three would be tantamount to subsidizing failure. That’s bad policy.”

“The bailout sought by Detroit would interfere with the adjustment process, while doing nothing to make the Big Three more competitive. A $25 billion infusion for companies that are losing $6 billion each month is not a rescue plan; it’s an expensive way of kicking the can down the road.”

“Want proof that automobile production remains alive and well in the United States? Just look at the success of Honda’s operations in Ohio, Toyota’s in Kentucky, Nissan’s in Tennessee, BMW’s in South Carolina, and Hyundai’s in Alabama, as well as the proliferation of new plants across the country, such as the new Honda facility in Indiana and the new Kia plant in Georgia.”

We noted in this story at The City Wire that trouble at the big three U.S. automakers will likely reach the Fort Smith region.