Reason Writers Around Town: Shikha Dalmia on Obama's Failed Auto Bailout
According to President Barack Obama, if his administration hadn't infused $80 billion into GM and Chrysler, the companies would have hemorrhaged to death. Financial markets, themselves in panic mode, would not have given the car giants the funds necessary to restructure through Chapter 11 bankruptcies. Hence, they would have had to shut their factories, sell their assets for scrap, and liquidate. And this would have bankrupted auto parts suppliers, shut down dealerships, laid off 1 million workers, and devastated entire communities. GM and Chrysler may never repay taxpayers in full, the administration's line goes, but any loss is less than the cost of this potential economic Armageddon.
That narrative might make for a great horror movie, observes Shikha Dalmia in her latest column for The Daily. But any resemblance to real world events is purely coincidental.