Obama's Awful Auto Plan

Barack Obama's plan to destroy America's automakers, and Michigan with them, deserves mention.

Obama to Government Motors: 'Let's Roll'

Karen DeCoster's article above provides a good overview of what the government has done to the automakers. After being strangled for decades by government regulations and government-backed union rules, GM and Chrysler were on the verge of bankruptcy. Rather than allow this to occur, and let the companies be restructured more efficiently, the government stepped in with a taxpayer-funded 'bailout'. But later, the government decided to allow a bankruptcy anyways, only to rig the proceedings so that the government and UAW union would take over the companies, rather than the bondholders who rightfully owned them.

Obama's Emission Policy Kills 800 more Americans a Year

Now, Obama is mandating higher CAFE standards, just two years after they were increased before. They mandate that the average fuel economy of all models produced by an automaker be above a certain number of miles per gallon. Since government cannot magically change the laws of physics, this will mean that cars and trucks that fall below the average will need to be priced so high that most people can't afford to buy them, or discontinued altogether.

This will force people into smaller, lighter cars, which are also less safe. The main way of increasing the fuel economy of an existing model is to reduce the weight by making panels thinner. This will also make cars less safe. CAFE standards have been shown to kill more than a thousand people each year. Obama's new standards may kill an additional 800 people per year.

Liberals love arbitrary government mandates. Don't you conservatives believe the free market can do anything? Why not mandate that cars all get 40 miles per gallon? Conservatives don't believe that the free market can do anything, we believe that it is the best way to distinguish between what can be done, and what can't, and achieve the good things that can be done.

Liberals love to cite the moon landing, but there is a long history of arbitrary government mandates that were trumpeted when announced and quietly repealed years later when people realized how irrational they were. California provides several excellent examples: California’s Potemkin Environmentalism

This mandate is also terrible for the domestic automakers. For years, American automakers have lost over a thousand dollars per car sold. They managed to stay in business thanks to sales of trucks and SUVs. Presumably they kept making cars so they could meet the CAFE standards. Obama's new rules will end the vehicles that made Detroit money and make the ones that were already losing money much worse.

The automakers will never make money again as long as they are controlled by the government. Government-run businesses can't make money even when they are monopolies like AMTRAK and the Post Office. The automakers will require a never-ending string of billion-dollar bailouts to stay in business. When they don't have to satisfy the customer to survive, vehicle quality and service will decline. That means sales will decline further, requiring bigger bailouts.

If you need a car that can hold your whole family and isn't a death trap, you had best get shopping. Or don't buy American.

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Obama Screws Michigan
Big Three Bailout?
CAFE Carnage