Hey Big Three : No bailout for you!


It should come as no surprise that all kinds of businesses and industries are trying to get a piece of the $3 trillion bailout mess. Why shouldn't they? The Treasury Department basically opened the checkbook and said, "Step right up, ladies and gentlemen." Too bad it was my checkbook, your checkbook, and the checkbooks of current and future taxpayers.

All week long, we've been hearing about how the U.S. automakers "need" some of the bailout funds. The frontrunner in the race to see which automaker(s) can receive money seems to be General Motors. The arguments in favor of bailing out the company? 100,000 jobs will be lost at GM. The company's 1,300 suppliers will be put at risk, along with their employees. Retirees stand to lose pension and health care benefits.

But why should the government bail out an industry that makes no sense? More cash for GM is like flushing money down the toilet. Sales are plummeting and the cash reserve is dwindling. Why? Because American car makers have cost structures to their businesses that are no longer viable. Between union pay, benefits, and retirement plans, the cost for GM (or either of the other domestic makers) is simply too high to be competitive.