Freedom New Mexico
The Big Three U.S. automakers were busy at the political conventions of both major parties this year, lobbying for more gravy from the taxpayers.
Specifically, they’re not satisfied with the $25 billion in low-interest loans Congress voted to grant them last year, ostensibly to help them develop new fuel-efficient cars and retool to produce them.
They want another $50 billion in similar loans from Uncle Sugar.
Barack Obama signed on to the idea long ago. Probably because the pundits have designated Michigan as a “battleground” state that either party just might win in November, John McCain has endorsed the idea as well.
So much for deep philosophical or fiscal differences between the two major parties. There are votes to be won, and just what did you think the taxpayers’ money really was there for, anyway?
This is a bad idea on any number of grounds.
The Fannie Mae and Freddie Mac debacle should have reminded us that making taxpayers’ money available to private (or quasi-private) companies simply encourages imprudent behavior. The Big Three (prodded by the United Auto Workers union) got into their current trouble through decades of imprudent decisions. Yet GM is still paying dividends to stockholders and all of the companies are paying bonuses to executives.
Should taxpayers subsidize these companies’ research and development into hybrids and other technologies? While Japanese companies have close ties to their government, Toyota, a leader in hybrids and alternative-fuel technologies, says it did its Prius R&D on its own dime — or yen.
The automakers argue that Congress has saddled them with stricter fuel economy rules, or CAF