Is $15 billion going to be enough for the auto industry or are they going to be asking for more next year?

thinker70 answered one year ago …

Here in Canada the industry is asking for something over $6-Billion and considering our population being roughly 10% that of the U.S. A., this would equate to the U.S. forking over $60. Billion to supposedly "save the industry" in effect GUARANTEED BY THE TAXPAYERS already unable or unwilling to buy their corporate production!

Where is this money supposed to come from? Neither government has it, so what they have to do is issue government bonds, which the banks will then accept as collateral for CREATING whatever amount of NEW MONEY is finally decided upon! The banks do this on the basis of the governments taxing power which means we the citizens (including our children and grandchildren), are on the hook, not just for the newly created money, but also for all the interest that accumulates!

The result is that corporations that HAVE ALREADY PROVEN, over the past 10 years or so that they can not produce vehicles at a PROFIT that people WANT and can pay for, let alone pay back their monstrous debts, will at best be TEMPORARILY saved from bankruptcy. BANKRUPTCY is the ONLY way they can SHED the debt , plus excessive salaries, BOTH management, (needs replacing) and unrealistic hourly wages and union negotiated benefits. The restructuring NEEDED also includes reducing the number of models built among other things, and since neither the UNIONS or management seem to "get it" the chances of the , companies being able to turn things around and actually become profitable and pay back the loans is ZERO to NONE, without a FORCED restructuring!

This "sense of entitlement" that GOVERNMENT should be the "lender of last resort" for corporations in trouble, (AKA the taxpayer) needs to be nipped in the bud. WHERE DOES IT STOP? Here in Canada the technology iindustry has now asked for a $60. Billion STIMULUS package, (read taxpayer guaranteed government loans) and no doubt there are others ready to line up at the trough!

Everytime the government intervenes in the free market it creates distortions and bad allocations of capital just as experienced in a socialistic or Communist central planning economy, which has NEVER WORKED successfully and never will. What needs to happen is restructuring of our economy based on HONEST MONEY instead of further enslavement to the banksters that create our money as a DEBT that just keeps getting "rolled over" and passed on to the next generation.

While the focus seems to be on GM, here is a case in point given our supposed capitalist system!. Cerebras Capital bought Chrysler from Daimler of Germany, supposedly doing their "due diligence" of inspecting the books, talking to management etc. It would now seem that this "hedge fund" seeking above average PROFIT miscalculated and either paid too much, UNDERESTIMATED capital needs or made other errors in judgement! HOW does that situation obligate us as taxpayers to bail the management and shareholders out for a bad management decision?

If your answer is unusual circumstances and unforeseen falling dominoes triggerd by the RECKLESS LENDING of the banks then my question is how does MORE reckless lending solve te problem?