Let Them Fail
America’s latest socialistic trend is that government will bailout failed businesses. This is not exactly a new concept as government has been bailing out failed individual losers for nearly forty years: those who wouldn’t get an education and have no work skills; idiots who have children they cannot afford to raise; and those with every conceivable definition of being “disabled”. The difference with this new class of failures is that they were once financial and industrial moguls, but through greed, corruption, inability to see future trends, and just plain bad management, have finally failed.
Why should we bailout Wall Street institutions whose executives made hundred of millions during the good times, but now have their hand out when reality has come home to roost? Why should we bailout banks that made home mortgages and sold them off, absolutely knowing they would default when increased interest rates kicked in? And why should we bailout dinosaur auto companies who rolled out SUVs and sports cars, rather than high mileage hybrids and models that used alternative energy? We shouldn’t. Let them fail. If we are hell-bent on spending hundreds of billions to stimulate the economy, give it to the successful innovators, not the failures.
Failure is the opposite of success. And success is achieved by avoiding the judgment and actions of those who fail. Yet government now wants to rescue and bailout those who made bad business decisions. By the way, when it comes to financial bailout, it means you and I will bailout these failures with our tax dollars.
If the economy needs financial stimulation, then give our hard earned money to the successful innovators. Give it to those companies leading the way in alternative energy and fuels; give it to those leading the way in research and development of new technologies; and give it to those who can make a real difference for our future.
A couple of examples to differentiate between business success and failure: American auto companies got a wake-up call during the 1970s gas crisis. As a result, they half-heartedly developed a few compact models that got thirty miles to the gallon. But as soon as the crisis abated and fuel costs decreased, they embarked on a thirty-year competition of seeing who could make the largest pickup truck or gas-guzzling SUV. Their excuse was that they were just giving the public what it wanted. That’s true, and now the public is now getting what it deserves: $100 to fill up the tank of their 12mpg tank. But what separates a truly successful company from those with momentary profits is innovation and leadership – something the U.S. auto companies don’t have and never had.
On the other hand, the public did not ask Apple to develop a super compact digital device that could store hundreds of hours of music and video. Apple looked to the future, developed the technology (without taxpayer money), and created one of the most successful electronic products in history. And profited hugely as a result. That’s leadership and innovation, and that’s success.
Reports out of Washington suggest that dozens of industries are lining up to get their piece of the bailout pie. The lobbyists are presenting the special case why their particular industry deserves a big chunk of your money. The situation has evolved from an emergency rescue of one individual banking institution to the attitude that the average taxpayer will now give their money to any business having financial problems. No doubt there will be some successful lobbyists who will take billions in pork back to their industry.
The politicians have convinced mainstream America that these bailouts will rescue critical industries, save other associated businesses, and ultimately save your job. They may save a few jobs for those industries that are bailed out, but they will have little impact on the overall economy. Once again, politicians have promised a quick legislated fix for our bad economy and now have to deliver with the appearance of doing something. But the fact is, an economy is a huge natural process that ebbs and flows over time, and we happen to be in the down phase. The only way this will turn around is when John and Jane Q. Public regain confidence and start spending again. Bailing out Wall Street and Ford and GM won’t do it.
Let them fail.
And while we’re on the topic of letting failures fail, I believe all the classes of entitled losers need to be allowed to fail as well. But that’s a discussion for another day.
– Matthew Hardy
Matthew Hardy is the author of A Culture of Crybabies: The 21st Century World of Wimps, Whiners, and Victims.