Detroit carmakers are seeking a taxpayer bailout. In exchange, General Motors donates a new Camaro to a wealthy athlete. Welcome to America.
Having failed in gaining your money in exchange for a car, they will now take it directly from your checkbook - with you receiving nothing in return.
The US Congress is getting good at giving out your money to companies whose pockets are already overflowing with excess cash, aka, the AIG debacle. These bailouts are prime examples of capitalistic excess.
College economics taught me twenty years ago that some companies will fail due to adverse market conditions. These failures are limited in scope because the market will adjust to difficult conditions, resources will reallocate, new jobs will replace old ones, and fresh markets will emerge. A free market system benefits a nation by giving corporations freedom to operate and workers an ultimate safety net. Pain is inevitable, but from trouble will be born new opportunity.
Today's economy is not going as the textbooks had planned. The US government is bailing out institutions to halt the panic in American households. Where is the government getting the cash? Don't ask, don't tell. Don't even worry about. Our kids will take care of everything.
Does GM really need bailout money? I'm skeptical. If they need extra cash, they can go to their friends. Enter Cole Hamels.
[Read more from: GM Bailout? Not After Giving Millionaire Athlete a Free Camaro]