Who is Too Big to Fail?

1924 Hupmobile Roadster

We keep being told this company or that company is “too big to fail.” Let’s review some history. How many auto manufactures existed in the early 1900s in the United States alone? The answer: 150 – yes, one hundred fifty. Apparently they weren’t all “too big to fail.” Instead, the market took its natural course and those who couldn’t keep up or didn’t produce the product the public wanted fell by the wayside.

Where are we now? Three major auto makers which are essentially run by the UAW. Is it GM and Chrysler who were “too big to fail” or was it the union bosses at the UAW and control of the union vote that was “too big to fail?” When contract law is thrown out the window and unsecured creditors (the union) are arbitrarily put ahead of secured creditors (bond holders), I think we have the answer. The GM and Chrysler bailouts have nothing to do with making cars, but instead have everything to do with pandering to the unions and increased governmental control over our lives.