While most of the press surrounding the bailout plan thus far has been specifically focused on mortgages, the government was given the ability to buy up debt other than mortgages. Now the struggling finance wings of the major car manufacturers are trying to get in on the party, and the party crashing is unlikely to stop there. Basically what the bailout bill says is that the government has the ability to buy up whatever they need to in order to save the economy. Thus, all the car companies need to do in order to receive aid is to convince the government that auto loans are vital to the U.S. economy. After that, who is to say that credit card debt isn’t just as important?
We will have to wait and see how it turns out, but from the sounds of things, the auto companies are prepared to lobby hard for support. Considering that this is an election year and that these companies hold a lot of power, I tend to think they will win the governmental support they seek. If they do win, the next question becomes: Where do we draw the line?
I find it hard to get behind the mortgage bailout, but at the same time I can see how they are important to the U.S. economy. Auto loans, though? Give me a break. I certainly don’t want my tax dollars going to support the car manufactures who gave some guy a 0 percent loan so that he would buy a new Escalade. People can get by without cars; fewer cars are better for the environment, anyway.
Sure, we face the possiblity of losing thousands of jobs if the auto companies don't get any aid, but realistically, these are jobs that are likely to be lost anyway. U.S. car manufacturers have been laying off people for a long time now. What makes us think that if we bail them out, things are going to be different? Either way, people are going to buy fewer cars with the economy suffering the way it is, and layoffs are going to happen. I would rather save our tax dollars and bite the bullet now than simply postpone the inevitable.
Furthermore, if we start bailing out auto finance companies, then what do we say when American Express and Discover come calling, saying they need help? How can we justify bailing out the auto industry, but not the consumer credit card companies? You can bet that just as people are having a hard time paying their mortgages and car loans, they are also going to have a hard time paying their credit card bills. Where, exactly, are we going to get all this money to bail out all these companies anyway?