Frank: Bailout is ‘Welfare’ for Auto Workers
Bailout Queen is at least honest.
As usual, Frank is nothing else if not honest:
“No. We’re not propping up companies. That’s your mistake,” he tells Stahl, who had asked him about taxpayer money going to prop up companies that had made bad decisions. “We’re propping up individuals. The world doesn’t consist of companies. The world is people. The country is people.”
When Stahl points out that Frank is then talking about welfare, he responds, “Yeah, I’m for welfare. You’re not? Are you for letting people starve?”
Frank is content to see the Big 3 as a modern-day version of the Works Progress Administration: a federally-funded jobs program. But where does it end? If the government is going to guarantee workers a nice wage by propping up inefficient industries, it reduces economic growth by sucking up scarce resources that the free market would put to better use elsewhere. It also forces companies to cater to government bureaucrats rather than consumers (eg, producing money-losing ‘green cars’ rather than profitable SUVs). The inability to produce what the consumer wants ultimately makes the firms more dependent on taxpayer subsidies, rather than less.
The Senate’s failure to agree on a bailout also illustrates clearly that Frank and Congressional Democrats are trying to use taxpayer dollars to guarantee UAW workers wages and benefits that the economy can’t support. Negotiations broke down because Senate Democrats toed the UAW line, and refused to accept a requirement that wages and benefits come quickly in line with those of the solvent automakers. But this is a deal that the government can only guarantee to a fortunate few workers; it can’t tax enough to give everyone an exemption from the rules of the marketplace. Why should UAW workers be the lucky ones, rather than supermarket workers or coal miners — or whoever?
Frank is advocating socialism, pure and simple. And ultimately, the automakers can only either receive more government subsidies, or fail.