The argument of the lefty bloggers – no measuring stick for reasoned debate, I know – is that the GOP opposes the bailout because they “want the economy to fail.”
Why is it that they only can see sinister motives for this? I thought a lot of these guys didn’t like the Wall Street bailout. Perhaps they just opposed that because they hate people who wear pinstriped suits, but for a bunch of us, the concern over that bailout as well as this one is the government loaning money to institutions that will never pay it back. (Making bad loans was what started a lot of this economic mess in the first place.)
As you read and listen to the coverage of this, why is it that the skeptics have to justify their opposition to throwing $15 billion or so at three companies that are burning through billions per quarter? GM alone lost $4.2 billion in the last quarter. Think about what it would take just for GM to break even next quarter. You would need to see a bonanza of car sales on a scale rarely seen, and it’s pretty darn clear that that won’t happen.
Sales are going to be absolutely terrible this month, next month, and the one after that. Sales of all cars by all automakers are probably going to be extremely sluggish all year long. There’s no way that $15 billion will be sufficient, and there’s no way that the company starts breaking even, much less generating a profit to repay this loan, anytime soon.
Why don’t our friends on the left have to explain how the loan will bring us to anything but a rerun, where the automakers return, hat in hand again, saying, ‘Hey, we need more?’
These folks seem to think that the automakers declaring bankruptcy is the absolute worst imaginable scenario. A worse scenario is the Big Three turning into a government-supported entity, where every couple of months they get another couple billion, in order to manufacture more cars that buyers aren’t interested in purchasing.