Should the US Taxpayer Bail Out the US Automobile Industry Term Paper

Should the US Taxpayer Bail Out the US Automobile Industry - Term Paper Example The answer to such a query should certainly be no, as such an approach goes against the sound economic principles and the spirit of a free market, which have been able to furnish the US economy with a competitive edge and a resilient sense of sustainability till date. Besides, there exist questionable approaches and elements within the framework of most of the top US automakers, which is supported by a bailout, stand to persist. The fact is that the American automakers seek money from the US taxpayers to retain their status quo, rather than for embarking upon an ambitious program to weed out the inefficiencies and lacunas existing within their setup (Gattuso and Loris 1). The politicians prefer to justify such emergency measures by citing the massive losses incurred by the US automakers. Off course, there exists ample truth in such claims. In October, the sales of GM fell by 45 percent (Gattuso and Loris 1). The Chrysler and Ford also reported respective plummeting of sales by 34.9 and 30.2 percent (Gattuso and Loris 1). The automakers ascribe this drastic drop in sales to the existing credit crunch. Still, one can not deny the reality that the US automakers did take many shoddy decisions before the credit crunch that unleashed the current crisis (Gattuso and Loris). Consequently, the US auto industry ought to change the way it works and operates, rather than attempting to stubbornly continue with its unsoun d policies by seeking a bailout. First and foremost, the US automakers must take care of the huge disadvantages in the costs that they suffer from when compared to the foreign brands. The average hourly compensation paid by the US automakers to their employees is way ahead of the remuneration extended by the foreign brands to their workers (Perry).  Ã‚