Does it make sense to bail out GM and others? On the one hand, they are starting to have a lot of good products, so they might have future. On the other hand, they are mired in UAW contracts which make it difficult to be competitive.
Because of the UAW, Obama will probably bail them out. But it might be just money thrown away, and they will be asking for more handouts again in a few years.
Maybe bankruptcy would be better. Then whatever would remain of the Big Three would be more competitive.
Here are some interesting posts about the financial problems of the Big Three:
- Should We Really Bail Out $73.20 Per Hour Labor?
- Detroit Auto Makers Need More Than a Bailout
- UAW Contracts Put Detroit On Road to Ruin, and A $50B Bailout Would Only Be The Down Payment
Here is what happened to British Car companies after the British Government bailed them out.