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Originally Posted by DGthe3
And I hope you realize that as tax payers, GM's own employess also paid for the bailout just like you did.
Nobody likes the idea of bailing out a company, an industry, or a country. But it has to be looked at as which is the lesser of two evils. Ideally, it would never have to happen. But ignoring circumstances and consequences in the name of economic theory is foolhardy because when you get down to it, reality is more important than theory.
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Most theories are usually rooted in reality. What consequences do you speak of? It seems to me that you're implying that there is some inherent instability in the free market that produces business cycles of booms and busts. Contrary to popular belief, there is no such thing; you can trace every boom and bust to credit expansion via the Federal Reserve. And yes, that does include the horrific Great Depression.
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btw, where do you get the idea that the private sector would have swooped in to save GM? As I said before, if they were going to, they would have done so in the fall of 2008. They didn't so GM was forced to look elsewhere or go belly up.
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In no way would the private sector have saved GM; investors viewed it as a failure and rightfully so. I'm not blind as to think it was
ALL GM's management fault, yet there is an undeniable bit of truth that it was at least partly the result of faulty management. It was also the fault of the Federal Reserves, UAWs, increased competition from abroad, etc.
However, I believe this whole bailout discussion to be irrelevant; it's the past and you can't change it. The focus should now be getting rid of government ownership of the assets bought under TARP.