Buggy Whips

Susan is on a campaign to help de-elect President Obama.   So by default that means elect Romney/Ryan.  The other day a sticker appeared on my bumper when I returned to my car in the Madeira parking lot.  Today, she and Paul will be distributing flyers. And now she is asking every family member to write an editorial to be submitted to the local press.  Since I aspire to the rule "Happy Wife, Happy Life" I decided to cooperate:

Who saved the Automobile Industry?

If you said President Obama, then you probably believe that Al Gore invented the internet.

The financial bailout of $85 Billion to avoid bankruptcy of General Motors and Chrysler was just a huge speculative bet using borrowed tax payer money on two companies in an industry in need of re-engineering. You might say President Obama is the ultimate stock market speculator.

So far, President Obama doesn't have a great track record of picking companies in any industry (Automotive, Financial or Solar).  The Government  has already booked a loss on the Chrysler bet.  The General Motors bet has an unrealized loss that fluctuates between $12 and $16 Billion.  Remember, we bought this stock on margin so we have interest payments on this borrowed taxpayer money.

Yes - but what about the three million "saved" automotive jobs,  you ask.  What about the jobs of those who supplied parts to these two automotive companies?   Tell that to the Ford Motor employee who was laid off because of lower demand for Fords;  Or the USA employees that work for Toyota and all the US suppliers to foreign automotive manufacturers. 

When Government tries to pick winners - we are all losers.  When Government tries to save an industry - it stifles competition and promotes inefficiency.  Our free market system rewards the efficient, well-managed companies (e.g. Ford Motor Company) which results in higher job growth, lower prices and vibrant competitive  companies in each industry.  Government intervention disrupts that process and uselessly prolongs the losers and creates an anemic job environment.

Where's your buggy whip President Obama?