4 ms·

The short term impact of letting the automakers fail would have been rough but in the long term we would have ended up with a more competitive economy.

• lawnchair_larry 8y ago
  That’s quite a bold claim. You must be one hell of an economist to just assert something like that.
  • tonyedgecombe 8y ago
    It's not hard to see that proving up failing businesses leads to inefficiency. Why bother making a more competitive product if you know the government will save you with bailouts or tariffs.
  • joshstrange 8y ago
    To be fair (and I really don't have a dog in this race) > GM or any other automaker with manufacturing operations in North America going belly up would have contributed to an even larger disaster Is an equally bold claim and is often asserted without citing a single thing.
  • cryptonector 8y ago
    It's a standard position for Chicago or Austrian school economists. It's also how every crisis was handled until the Great Depression. Then we resorted to massive intervention to prevent liquidation. This experiment was repeated in the 90s in Japan, leading to two lost decades of economic growth. We don't seem to want to learn.