Obama Wrong on Auto Bailout and Wrong on Volt

July 30, 2010 - PRLog -- In a speech today, Our Dear Leader continued to make the case for the 2009 bailout of defunct automakers GM and Chrysler. He argued that millions of jobs  had been saved and pointed to recent hiring by Chrysler as proof of the foresight of his action. This, of course, is small potatoes compared to what private enterprise can do. I, myself, have created or saved over 5,000,000 jobs in this calendar year alone.

As if this was not absurd enough, ODL went on. "The shutdown of these two firms [GM and Chrysler] would have rippled out to bankrupt suppliers and dealerships- including adverse supply effects on the supply chain for Ford, the other large US automaker." This only underlines the fact that Mr. Obama does not understand capitalism. I have a feeling that Ford would not have shed very many tears over the passing of two of its largest competitors. I have no doubt that whatever demand GM and Chrysler were supplying would have quickly been taken up by Ford and their other competitors. This would have required those companies to expand and purchase more supplies from their existing suppliers, and probably require those firms to increase production. There may have been some realignment in the auto industry, but Ford's existence is not dependent on the existence of GM and Chrysler. That is simply ridiculous.

Then there's the whole issue of the "new" Chevy Volt. This is interesting. First, because the Left has been pushing this idea for nearly a hundred years. Obama and his minions are all acting as if the Volt is some kind of snazzy, new thing that no one had ever thought of before. The long and short of it is that the idea simply doesn't go very far in the marketplace. In fact, it doesn't go very far at all. "Plug it in, let it charge overnight, and it's ready to run on a pure electric charge for up to 40 miles." That is truly progress. You charge it for 6 hours or so, and you get a whole 40 miles out of it, which is barely far enough to go to work and back for most people. And then there's the price tag, $41,000, making it one of the most expensive cars on the market. But GM knows they won't be able to sell these things, so they got the federal government (paid for by you and me) to pony up a $7500 rebate on every one of these sold. Now, if GM after it's massive government-sponsored restructuring builds a car that can't break 40 miles without needing a re-charge and can't sell that car without a $7500 subsidy from the government, just how far have they come? How viable are they? In this humble writer's opinion, it would have been better to let GM and Chrysler to sink into bankruptcy and allow new competitors with new ideas to enter the scene.

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