I expect the Democratic Party to amplify their argument that President Obama’s orchestrated bailout of Chrysler and General Motors was good for the American economy. According to the White House, about 1.25 million jobs were either saved or created as a result of the auto bailouts.
Yes, that’s good news, but was that good for the economy? The economy is about society making choices regarding using available resources to produce optimal output of goods and services. What the bailouts demonstrated was the result you get when government attempts to impose its production preferences on industry. This action is worse than picking and choosing industries to subsidize. It’s overly intrusive.
The appropriate thing for government when it has an excess of ideal labor is to find out from the private sector where they believe the needs for labor are and provide labor with information as to where these opportunities are and how best to prepare for them. If there is market failure, ( a concept I personally no longer subscribe to because markets do not fail), then the only appropriate approach government should take is to fill in the information gaps.
The auto industry bailouts should not be held up as an example of the Administration’s economic prowess.