Editor, The Wall Street Journal
To the Editor:
You rightly dismiss the argument that a government bailout of GM, Ford, and Chrysler is justified by the concern that people won't buy cars from companies in Chapter 11 ("Mitch McConnell's Finest Hour," [1] Dec. 13).
People will indeed not buy cars from companies that might not be around in a few years. But this fact argues against, not for, a bailout. Precisely because – unlike Chapter 11 – a bailout postpones the need for these companies to restructure themselves into more-competitive producers, it makes their long-term survival much less likely than would Chapter 11.
Sincerely,
Donald J. Boudreaux
Don Boudreaux is the Chairman of the Department of Economics at George Mason University and a Business & Media Institute adviser.