I don’t see anything wrong with the loan...Chrysler got one in the 70’s and the government made money...we give small business loans-only 1 in 10 are in business five years later...nothing wrong with a loan that saves and entire industry. We just disagree.
Also, where do you think the states get the money to give businesses? That would be from taxes... Anyway we will see what happens. I am hoping for good things for the big three and the economy.
You accidentally hit on the other problem with the bailout. Chrysler got one in 1983 and now 25 years later they need another, thus proving that all that money didn’t help them fix the core problem of a mis-run company.
Failure part of the natural business cycle, the failure of some helps others to succeed. By bailing companies out and preventing failure we prevent that additional success for others. Think about it like this, had Chrysler failed GM and Ford would have been the big winners, being the only other major American auto companies (and thus the only guys capable of getting the “buy American only” customers Chrysler left behind) and the only other big truck guys they would have gotten the lion’s share of Chrysler’s business. To keep it easy figure GM and Ford would each have gotten about 1/3 and then “the field” (Japanese, Italian and small American companies) would have gotten the rest.
How much better off would GM be now if for the last 25 years they’d gotten 1/3 of Chrysler’s business?
And the answer to that question is why bailouts are stupid.
The states are GIVING with tax breaks, they’re TAKING LESS. We’ve already had that discussion.