There is a lot of debate on whether US automakers should be bailed out?For the motion believe that these automakers employ a number of people and a collapse at this point would worsen the economic situation. Against the motion says these companies are not producing cars no one wants and should be left on their own.
Here are a few resources to understand the issue:
- House Committee on Financial Services had a hearing where academicians and automakers presented their views.
- Mankiw points to views from Gary Becker (no) and Jeff Sachs (yes)
- Matt Slaughter (of Dartmouth) presents his views and is against bailout (He also testifies at the House Committee on Financial Services
- Mankiw points to huge cost differences between US and Japan automakers
- Luis Zingales and Joshua Rauh say Chapter 11 is the best way out