GM and Chrysler could have gone bankrupt and life would have gone on. In fact they would probably be better companies today if they had gone bankrupt in the traditional (and legal) way. They would be leaner, meaner, and more competitive.
They would have been restructured and there would have been some disruption to be sure but investors would not have been tossed aside for votes and the American taxpayer would not be on the hook for gratuitous pensions and health benefits. I will never see a pension. Most people my age will never see a pension. I personally am OK with this, but I am not OK with paying for some guy in Lansing to retire at 55 and to move to Florida. That is just theft.
But in the attached article from the Wall Street Journal we see that we had better get used to thinking of GM as Government Motors and Chrysler as its equally dependent little brother. The Obama administration is just fine with this. The UAW bailout means votes, plain and simple. So what if it’s morally wrong and slows the dynamism of the American economy. Labor is taken care of, very nicely.
Now you 20 and 30 somethings, you get back to work! Oh wait, you guys don’t have jobs.
Darn, now how IS it that we are going to pay for all the union retirees?
Well, that is a good question.
Vote Obama 2012!