Tuesday, December 16th, 2008 | Author:

If you listen to mainstream media, you’re convinced that the poor auto industry needs a bailout, just like poor Wall Street did. My illustrious Senator, soon-to-be-Secretary-of-State, confirmed this view in her recent response to an email I sent:

The auto manufacturing sector has been devastated by the recent economic crisis.

If you’re talking about “The Big Three,” then they certainly have been devastated, but it’s not by the recent economic crisis. That may be the proverbial straw that broke the camel’s back, but honestly? They’ve been poorly-managed for decades, and deserve to fail.

If you look outside of Detroit, though, and read something other than the current party line, you’ll discover that the auto industry in America is flourishing. Flourishing? Read some of what the Weekly Standard has to say on the subject:

Foreign car manufacturers, the so-called transplants, have been setting up shop in the South for a quarter century now, starting with the plant that Nissan opened in Smyrna, Tennessee, in 1983. It’s still operating. Nissan added a second plant in Canton, Mississippi, in 2003. Two years ago, Nissan moved its American headquarters from southern California to Cool Springs, Tennessee, just south of Nashville.

The auto production numbers in the South are staggering. A dozen years ago, Alabama produced zero cars. Now it turns out 750,000 annually at Mercedes, Honda, and Hyundai plants. Three years after Mercedes opened its SUV factory near Tuscaloosa in 1996, it doubled the size and output. A Honda plant halfway between Birmingham and Atlanta went on line in 2001, and the next year the company spent $450 million to expand it, adding 2,000 more workers.

This story also highlights that KIA is building a plant in West Point, Georgia, that will employ 2,900 a year from now.

This, my friends, is the free market in action. Bloated, self-satisfied companies fail and new, nimble companies replace them. This, of course, doesn’t make the failing companies happy, but is that a reason to force taxpayers to prop them up?

If we aren’t prepared to take responsibility for the consequences of our bad decisions, then we don’t want liberty, we want socialism. As Milton Friedman once said:

Underlying most arguments against the free market
is a lack of belief in freedom itself.

Category: bailout, economics
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