Jobs Saved?

If you open Consumer Reports as Greg Mankiw did, you will find that the car companies we have bailed out make some of the worst cars out there. Some of the companies even got a rating of ZERO. The fact that they were on the brink of collapse appears to show that the markets are working just fine – at least as far as the car market goes.

If we had left those companies go bankrupt, there would have been tremendous jobs loses as a result.

The administration has claimed that because of the stimulus package it has already created or saved 150,000 jobs. While I’m not sure the bailout of the car companies is  directly part of the stimulus package, I’m pretty sure of the fact that the jobs saved number cited partly includes the salvation of the car companies in its estimate.

All I can say about that is that claiming that you saved jobs by keeping a company like Chrysler afloat is like saying you gave someone who became brain-dead a second chance at life because you put them on life support instead of pulling the plug. Sure, some folks who fall into the vegetative state may spontaneously recover, but all that energy could surely be put to better use. Those billions could be used to fund cutting edge research or lower taxes or provide unemployment benefits. In my mind, those were not true jobs saved, but rather, death delayed.

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