Over the past few weeks, I've overheard a lot of conversations about the so-called "Big Three" automakers — Chrysler, Ford, and General Motors. If you're Rip Van Winkle, here is the precis: Chrysler and GM are in terrible financial shape, about to fail, and they've begged the government for a bail-out package. Ford says it does not need government loans right now, but if the others fail — its survival is far from certain.
A few minutes ago, Andrew Sullivan weighed in, with a post called "Let The Big Three Die." In it, the Atlantic senior editor writes,
The point of capitalism is that actions have consequences. Once that market discipline is removed for a few of the worst, ill-managed, union-crippled companies in America, the stage is set for endless mediocrity, government-run industry (i.e. even more endless mediocrity), and a free-for-all at the government trough.
Sullivan cites a new poll, published in The Washington Post: "Overall, 55 percent of those polled oppose the latest plan that Chrysler, Ford and General Motors executives pitched to Congress last week, on par with public opposition to earlier, pricier efforts."
Jon Cohen and Jennifer Agiesta, writing in the Post continue,
Opposition to the automaker bailout is fueled by the widespread perception that the companies themselves are responsible for their predicament, not the faltering economy. In the new poll, three-quarters of Americans said Detroit's woes are mainly the fault of its own management decisions, and a sizable majority of those who blame the front office object to government help.
How bad do you think the fallout would be if the American automobile industry doesn't receive emergency aid from the government?