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IPFS News Link • Business/ Commerce

GM, Bailouts, and the Importance of Bankruptcy in Market Economies

• https://fee.org by Oluwatobi Walker

With news in the past few weeks of General Motors (GM) dialing back on its operations by cutting 15 percent of its workforce in order to reduce its losses through the idling of plants in Maryland, Michigan, and Ohio, along with reducing its product line, scrutiny of GM's operations and the auto bailout of 2008-09 are back in full swing.

Commentators have given reasons ranging from the federal government's fuel emissions standards to President Donald Trump's tariffs as to why GM is in its current straits.

But for opponents of the auto bailout of a decade ago, GM's current predicament serves as vindication regarding why the government should not meddle in the marketplace in order to save failing industries. In response, supporters of the bailout ask what would have happened to the American auto industry without the bailouts, with the implicit assumption being that GM might not exist today.


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