Monday, October 6, 2008

A tale of two bailouts

While the White House and Congress have been embroiled in negotiations over the $700 billion bailout of the nation’s bedraggled banks, another bailout of sorts passed Congress just under the radar: $25 billion in subsidized loans for Detroit’s bedraggled automakers.

The Detroit number is much smaller, but still huge. Unlike the nation's financial system, there is no reason to believe that American automakers can be competitive on the world stage. They are simply too ossified and hamstrung by labor issues.

1 comment:

Anonymous said...

American automakers can be competitive on the world stage -look at Ford and GM in the emerging markets.

They cannot and will not be competitive in North America. Unless America adopts socialized medicine. This is why Edsel Ford Jr. has 2 Obama signs on his (large) front lawn on Lakeshore. (The Fords are not Republicans no matter what the world thinks -they all go to Prinecton). But no fear. If America does not go for socialized medicine, the Fords have a back up plan : They've mortgaged everything at Ford Motor including the Blue Oval -look it up. And they have plans (and those plans are underway) 12 new factories in Mexico employing 225,000 non-Union Mexicans in those factories.

So we just gave the Fords more money to put off their inevitable plan...

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