Should the U.S. automakers be bailed out?
The U.S. Government has spent billions of dollars bailing out financial companies like AIG. They see this as a necessary step to stabilize the financial system. The question is should other industries like the automotive sector be bailed out? General Motors and Ford in particular are having a difficult time as of late. They were on the decline before the economic crisis losing market share to Toyota. Their costs far exceeded other companies thus they are not as competitive. When the economic crisis hit and the consumer started to struggle the Big 3 continued their decline. General Motors has stated they are running out of cash quickly, it is anticipated they may run out of cash in the New Year. Raising money will be difficult since no one will lend them money; raising capital through a stock offering is highly unlikely since the shares are almost worthless. One of two things will happen to GM, they will either file for chapter 11 bankruptcy or the government will come up with a bail ou
