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Metro Times columnist Jack Lessenberry isn't buying into criticism about the auto bailouts.
He notes that there are folks who are unhappy with the bailouts, and point to the fact the government is going to lose $10 billion after it sells off the remainder of its General Motors stock. The Treasury spent about $49.5 billion bailing out GM and taxpayers will only get back $39 billion when all the government owned stock is finally sold off.
Lessenberry writes:
But to say we “lost” $10 billion on the bailout is exactly like saying you “lost” $30 bucks because you had an oil change, instead of waiting till your engine exploded.
Here’s what would have happened if the government had not “bailed out” General Motors and Chrysler, and helped them to a soft landing: They would have gone out of business with a thud.
According to economists at CAR, the Ann Arbor-based Center for Automotive Research, this might have toppled Ford Motor Co. into bankruptcy as well, since many suppliers who supply all of the Detroit Three might have gone under as a result.Had the government not stepped in to save the country’s domestic automakers, what that would have meant — especially in this region — is nothing short of a second Great Depression. At one point, CAR estimated that the bailouts of GM and Chrysler saved more than 1.14 million jobs in 2009, alone. Hundreds of thousands more jobs would have been lost the next year — and the year after.
