The Congressional Assembly Line of Handouts

At the end of the fall semester, I wrote a paper concerning the potential congressional bailout of Ford, General Motors, and Chrysler. Since then, President Bush stepped in with a temporary fix consisting of a 13 billion dollar plus loan in the absence of any Congressional activity. So while the issue no longer dominates the airwaves, it is likely to reappear sometime after Obama is sworn in. When addressing whether the government should bailout private companies, the first question that must be answered is whether the government possesses responsibility in this area?

John Locke believed individuals form civil government to preserve life, liberty, and property. This concept served as the foundation for Declaration of Independence’s declaration for the right to, “Life, Liberty, and the Pursuit of Happiness.” Locke concluded that the great end of civil government is the preservation of its citizens’ property. Judeo-Christian heritage provides that civil government’s responsibility is to preserve justice. This is essential to preserving property. Thus the preservation of property and justice seems essential to any government action.

Without developing any deeper correlation, the auto bailout is not a matter of preserving property or justice. While a failure in the auto industry would have adverse effects on the citizenry and the economy, it would not result in a lost of property or justice.

If anything, government intervention in this situation would be a matter of property creation and not property preservation. These are two very distinct things, the latter being clearly within the responsibility of government and the former being questionable. So if it is not the clear responsibility of government to be involved in the bailout, is it prudent for government to be involved? Does it make good business sense for government to increase the efficiency of their congressional assembly line of handouts? I will address this in my next post.

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