There’s a lot of talk around that the feds should bail out GM and Ford. I’m dead set against that. They should be allowed to go bankrupt.
The biggest reason these companies should be allowed to go bankrupt is their worker compensation is irrational and not sustainable. An UAW auto worker gets paid around $70 an hour! Toyota and Honda auto workers get paid around $45 an hour. How can GM and Ford compete with that disparity? Bailing out and propping up such an operation would be pouring money down a rat hole.
Bankruptcy, if done right, can rationalize now irrational worker compensation. A bail out will just perpetuate it.
Now some say that Obama and the Democrats are pushing a bail out of GM and Ford in order to pay off their union supporters. Surely not!