Response to Video Question 2

This is my response to CBC’s question: How would you address the crisis in the automotive industry (video below). In my opinion this simplifies to another question: Should the government bail out the big three. My short answer to this question is no. And there are several reasons for that. First off, the automotive industry, as it pertains to the big three of Chrysler, Ford and GM is unsustainable. These companies have deep-rooted problems due to poor management and a bailout now would only push off their inevitable bankruptcy. Experts are predicting that if the $14 billion package in the US makes its way to the companies, even with additional help from the Canadian government, it would give them a maximum of 2 additional years before more financial help is needed. In order to avoid this, a complete structural change is needed, towards a more sustainable and environmentally friendly business model. The companies offered no such change to the U.S. congressional committee. Furthermore, experts agree that our economy is in transition, towards the knowledge industry. In the future, most of our well-paying jobs will be in this sector of the economy, not manufacturing. Also, a recent statistic showed there were no major net losses in manufacturing jobs in the last month, because while Ford and GM were laying off workers, Toyota and Honda were hiring in almost matching numbers. So, if in the short run autoworkers are switching companies and in the long run our jobs will be in a different industry altogether, then there is far less of a need to spend billions of dollars of tax money to push off the inevitable for a few months to two years. If the government has to get involved in our current economic situation, it must help to create the jobs of the future, which will be greener and in our developing knowledge industry. Thank you.