Bankruptcy is the greater good
Wednesday, 10 December 2008 by Jacob TomawWalter E. Williams provides so basic economics on why we should not bailout the auto industry. The whole, short article is worth reading, but I wish this paragraph could be read to every congressman.
What happens when a company goes bankrupt? One thing that does not happen is their productive assets go poof and disappear into thin air. In other words, if GM goes bankrupt, the assembly lines, robots, buildings and other tools don’t evaporate. What bankruptcy means is the title to those assets change. People who think they can manage those assets better purchase them.
This is completely ignored by the media, as far as I can tell.
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Posted in Economics
Taged with Bailout, Walter E Williams
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