The Looming Challenge for the Advancement of Euro-Style Soft-Socialism in America…
…is most likely to come from the automobile industry. Did anyone else note the statistics related to automobile sales released at the end of last week (via Reuters, in the excerpt below)…
U.S. auto sales tumbled by 23 percent in September as showrooms emptied after the government-funded boom from the “cash for clunkers” program, with General Motors Co and Chrysler hardest-hit.Assuming that Reuters is presenting an apples-to-apples comparison with Ford, the GM and Chrysler percentages would be one-month totals compared to the prior year.
Sales for General Motors Co and Chrysler — the two U.S. automakers struggling to regain momentum after emerging from bankruptcy — dropped by 45 percent and 42 percent, respectively.
Ford — the only U.S. automaker to have avoided bankruptcy — managed to hold its sales decline to 5 percent from a year earlier despite low inventories and reduced incentives for car shoppers.
General Motors and Chrysler, you may recall took copious amounts of bailout money from the government — along with copious government conditions attached — as part of the Obama administration’s economic program, which is premised largely on the idea that businesses run better when they are more aggressively regulated or directly managed by the government.
So what will be the response, if government-ownership fails in a major industry? Will advocates of government planning of the economy begin to accept that government ownership of something doesn’t provide an exemption from the laws of economics, and actually look for the underlying sources of GM’s troubles, instead of blithely assuming that government ownership solves them whatever they are? Will they double-down and say the problem with the auto bailout was that the amount of taxpayer money was too small and that more bailout money is needed?
Or will they say that looking that GM and Chrysler’s success in conventional business terms (was more taken in than was spent) is just a distraction, and the important thing is that government has more control than it did before?