Job-Creation Scheme?

http://www.futureofcapitalism.com/2009/06/job-creation-scheme

The Financial Times has a good overview of skeptical commentary on the auto industry bailouts, which, it notes, include not only the American aid to General Motors and Chrysler but also the French government's 6 billion Euro bailout of Peugeot and Renault, and a German government 1.5 billion Euro "bridge loan" to Opel:

"The shape of the industry looks all but the same, except that governments have tipped lots of money in and prevented Darwinian selection," says Max Warburton, analyst at Sanford Bernstein. "It has been a good reminder of what this industry is: a government-supported job creation scheme."

Also:

"Because of government intervention, we're not going to see the same level of rationalisation that pure market forces could have driven," says Paul McCarthy, head of PwC's automotive strategy practice. "In the long run, we will pay for that."

Jun 18, 2009 at 11:02 am Related Topics:  Auto Industry receive the latest by email: subscribe to the free futureofcapitalism.com mailing list