David McConkey - Columnist, Consultant, Citizen
Columnist. Consultant. Citizen.

Was the GM Bailout the Best Move for All Canadians?

Brandon Sun, June 27, 2009 - David McConkey

The recent General Motors bailout got me thinking again about the dearth of good ideas in our Parliament.

During the last federal election, I wrote a column about the value of electing green MPs. But why stop there? In my better parliament, there also would be socialists. And free market capitalists.

The Conservative federal government is spending billions to bail out GM. This bailout was announced with almost no explanation from the Conservatives and with almost no criticism from the Liberals or New Democrats.

Of course, opposition parties are not going to question the spending of money on potential Ontario voters.

The GM bailout is huge, amounting to about $2 million for every worker that GM supposedly will employ in the future. And now that we have “Government Motors,” the stage is set for even more bailouts.

But back to my better parliament. Wouldn’t it be great to have green MPs asking some really good questions? Why are we subsidizing the auto industry when a green future will rely more on public transportation? Why not subsidize the manufacture of solar, wind, or energy conservation technologies? 

Subsidizing General Motors is rewarding a company that for decades resisted being green. This is the company famous for making cars that would fall apart through “planned obsolescence,” for fighting safety and environmental regulations, and for producing gas guzzlers like the Hummer.

In my better parliament, there also would be a voice for socialism. “We are all socialists now” has become a cheery (or dreary) catchphrase in the U.S. after the huge bailouts and buying of bank stock that started in the George W. Bush presidency.

But I would like socialist MPs who would say that this is not real socialism. MPs who would say that buying GM is not buying the means of production because GM may not produce much at all in the future.

Why is the government bailing out unionized GM workers who make on average about $70 an hour in wages and benefits? (That’s $140,000 a year by my calculation.)

Why not instead help workers in Canada and elsewhere in the world who are not unionized and who have really low wages and terrible working conditions?

Furthermore, socialist MPs could question why the Conservatives are spending money on GM, after they rejected the Kelowna Accord. That agreement to spend more money helping aboriginal communities was reached by the previous federal government, provincial governments, and First Nations leadership.

Finally, I would like to hear from free market capitalist MPs. Stephen Harper originally seemed to embrace the Reform party goals of no deficit, no big government, and no corporate welfare.

Who would have guessed that Harper would take his inspiration instead from the Social Credit (“funny money”) branch of the party?

Free market capitalist MPs would question the GM bailout for distorting the market.

Over the decades, consumers have thought long and hard when choosing which vehicle to buy. GM was the most well-positioned company of all to influence those consumer choices.

To bail out GM now is to say to all consumers and to all businesses that the system can be subverted by the government at any moment.  

One of the great things about capitalism is creative destruction. Old ways die to make way for the new. For the government to put a dying company on life support just slows down this process of renewal.

The government speaks of “investing” in the auto industry, but bailout spending is actually more like highway robbery.

The money for GM is being taken away from other sectors of the economy. Instead of the free market deciding the best use for capital, governments are deciding – on a whim or for regional votes. And because the money is being borrowed, the economic distortion will last for years.

My better parliament with green, socialist, and free market capitalist viewpoints is, of course, just a dream.

In reality, our politicians are reluctant to speak out and tell us voters the hard truths.

That we have to pay to repair a damaged natural environment. That we need to consume less. That we need to look out for those who are less fortunate. That some short-term pain must be endured for long-term gain. That we need to pay higher taxes and get fewer government services.  

How can we get politicians who will challenge us with good, big ideas?

I guess we will just have to elect them.
* * * *
See also:  

Vote Early, Vote Often, and Vary Your Vote

Can’t We Do Better Than This Same Old Political Routine?

Maybe a Little Fox News Would Liven Things Up

Citizenship Redefined

Citizen Active



David McConkey,
Brandon, Manitoba
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