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kutelilkat's avatar

Need some help: Argument essay why government should continue to bail out car industry?

Asked by kutelilkat (279points) May 7th, 2009

I’m just looking for a little help. Anyone know of a good place to look for information on this subject? I have to be for the bail out in my essay but I’m having some trouble really feeling confident in my material because it seems like I’m unsure if they should bail them out our not. I’d like to have some statistics (number that would be unemployed etc…)

Could someone help point out a few main reasons the bail out would be the right choice?

I know of some reasons…but I don’t feel confident with my essay.

I think the other side will have a better argument than me.

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11 Answers

FrankHebusSmith's avatar

Well if you’re just arguing it, like debate class style, then your belief on the matter needs to be put on the back burner. Think of yourself like a lawyer with loose morals, you just need to do what you need to do to win.

The arguments for keeping it are easy though.
-They employ a huge amount of americans (I’m sure you could find actual stats on that)
-They’re the backbone of our entire manufacturing industry in the US
-If they went under, so would a huge number of businesses associated with them, and millions would lose jobs.
-In times of war or high concern our automotive industry can be turned towards manufacturing what we need (ala how in WW2 the government basically took it over and used it to make vehicles and aircraft).
-It’s hard to justify punishing everyone associated with the auto industry for the poor management of those at the top.
(just a few to start with)

Also if you’re going to debate it and you want to be prepared, you should think about what arguments your opposition will make (which sounds like it will be easier for you to do), and think of counter-arguments for those.

For example, the easy argument is the question of why we should be spending tax payer dollars to bale out an industry that simply failed (ala why not let the free market do what it’s supposed to, and failed businesses fail). The counter argument being something about how tax payers would probably be in more pain if the industry went under than they are loaning money to them now.

(I would be sure to point out that we’re not “giving” the money to the car companies, they’re loans, and if the companies survive they will have to pay them back, and we would make profit from that…. Chrysler actually did this 20 or so years ago and paid us back early and for a big gain).

BookReader's avatar

…the timing could not be better to revamp the entire energy industry- the auto industry would be a part of this bold timely transition…

…perfect opportunity to re-wire the U.S. and World to depend on renewable energy sources and passive energy sources- not to mention universal expansion/ space travel- A WONDERFUL OPPORTUNITY!

YARNLADY's avatar

The collapse of the companies could mean the end of the US car industry, one of the few remaining blue collar businesses in the country, and the loss of tens of thousands of jobs.

If the American car industry collapses the shock waves throughout the global economy would be devastating.

Restaurants, gas stations, hospitals, and then cities, counties, and states—all of them would feel pressure on their bottom lines.

Countless university engineering programs are funded with this in mind and supply graduates hoping to get jobs in the industry. Without it we’ll have fewer workers and fewer engineering graduates with those skills and that will make the US less competitive. These are the students that will be finding solutions to our pollution and energy issues in the future.

It will no longer be possible to “buy American” and all that support will go to foreign car makers.

kutelilkat's avatar

Thanks for all your help :)

BBSDTfamily's avatar

If they don’t, then all of the financial lender’s sales rep (me included) will lose their jobs :( Sorry I don’t know any figures, but everyone else has had great answers.

kutelilkat's avatar

In what ways exactly would not providing a bail out affect the banks/loans etc?... Im not sure I understand this point. I wanted to talk about it in my essay though.

YARNLADY's avatar

The major income product in the car industry is not the selling/manufacture of cars, but instead the loans to buyers. When car sales don’t happen, the loan industy falls apart.

It’s pretty complicated if you don’t have a good idea how the loan process affects the economy. Let me just say this; a loan is a promise to pay, by the borrower. The lender then combines many of these promises and sells them for the face value of the promise. In other words, the lender turns a promise of money into current/real money.

The end buyer then owns only ‘future’ money (promises). His return will be the face value plus the interest, but it’s an investment, not real money.

Ok, go back to the original lender. He has sold the promises, and now he takes the money and lends it back out again. It’s a vast circle and when one part of it collapses, the whole thing collapses.

FrankHebusSmith's avatar

In effect, loan companies are another secondary business that would be effected, as they base their businesses on giving loans, and cars are a major source of those loans.

YARNLADY's avatar

I also just read that the sports industry will fail if there are no sponsorships to prop it up. Advertising is the first place a company cuts back on. No more NFL, MLB, NBA, NHL, and so on.

kutelilkat's avatar

Oh wow, I get it now. Thanks ;)

kutelilkat's avatar

@YARNLADY…jeez, I didnt think about that..

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