Comments on: US can’t afford to let GM do a Lehman Bros http://www.crikey.com.au/2008/11/17/us-cant-afford-to-let-gm-do-a-lehman-bros/ now with extra source Sun, 12 Feb 2012 02:48:10 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Ben Aveling http://www.crikey.com.au/2008/11/17/us-cant-afford-to-let-gm-do-a-lehman-bros/#comment-3549 Ben Aveling Thu, 01 Jan 1970 10:00:00 +0000 #comment-3549 The American car industry is like American cars: Big, expensive, and can't turn the corner. <br /><br />Seriously, the problem with subsidies and protection is that they come at a cost to other taxpayers and other industries, who have to pay more tax and have to pay more for their inputs. <br /><br />If there was any suggestion that this was a short term problem, or that anyone really had any idea how to fix this problem, maybe another handout would be more appropriate. But more of the same is unlikely to produce anything other than more of the same.<br /><br />Subsidies haven't worked for the car industry. Merge after merger hasn't worked either. Maybe it's time to try splitting up some of these companies. No doubt, some will float and some will sink. But it gives them all a chance that they don't seem to have at the moment. The American car industry is like American cars: Big, expensive, and can’t turn the corner.

Seriously, the problem with subsidies and protection is that they come at a cost to other taxpayers and other industries, who have to pay more tax and have to pay more for their inputs.

If there was any suggestion that this was a short term problem, or that anyone really had any idea how to fix this problem, maybe another handout would be more appropriate. But more of the same is unlikely to produce anything other than more of the same.

Subsidies haven’t worked for the car industry. Merge after merger hasn’t worked either. Maybe it’s time to try splitting up some of these companies. No doubt, some will float and some will sink. But it gives them all a chance that they don’t seem to have at the moment.

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