From the NYT: Federal Aid to Detroit Seems Likely:
“Ms. Pelosi sharply criticized the Bush administration on Wednesday over the $85 billion bailout of A.I.G., saying it was evidence of mismanagement by President Bush. But she expressed strong support for the automakers’ loan guarantees, which would be used to help the companies meet new fuel efficiency standards that Congress adopted last year.
“We see that as a way to rebuild and strengthen the technological base of America,” Ms. Pelosi said at a news conference in the Capitol. “It would certainly help people in the auto industry, but it’s not only about the auto industry, it’s about the auto industry, it’s about our economy, it’s about America’s work force.””
And here comes the flood-gates of bail-outs in three, two one…
When the government lost its game of chicken with Wall St. over AIG, I knew that soon thereafter, everyone else would come begging for the next hand out. And predictably enough, the automakers, who just happens to be located in two major swing states (Michigan and Ohio) in an election year, will probably get their way with taxpayer money.
You can bet your money (however little of it that is left), that were Michigan not a swing state, this bail out would not have happened. But no, we have to hitch taxpayer money to pay for uncompetitive companies–just one more reason to abolish the electoral college.
I hope that Congress, in its one week of session left, includes something more than just the bail out in the second stimulus pacakage: some ideas are extending unemployment insurance and food stamp programs, as well as infrastructure investments.