Auto Bailout Should Have Conditions

Bailout is the word again this week; this time for the auto industry. Proponents of a bailout/loan package for the Big 3 automakers say it's absolutely necessary. Why? Because, according to the Center for Automotive Research, "nearly 3 million jobs would be lost in the first year if there is a 100 percent reduction in Detroit Three U.S. operations." If those people lose their jobs, they'll be spending less money and buying less stuff, and there go everyone else's jobs.

I have two problems with this. First, I think continuing to base our economy on consumerism (people have to buy more stuff to keep the economy going) is a mistake. There is no way that we can indefinitely keep asking people to buy more stuff so that companies can keep growing. It just isn't reasonable or sustainable to expect constant growth.

Second, while we do need people to have jobs, I don't think they have to be in the auto industry as it stands today. The hard truth is that we are facing both a global climate crisis and, someday, an oil shortage. We have to get out of our gasoline-powered vehicles at some point, and sooner is probably better than later.

So, if we must bail out the auto companies, or at least the jobs associated with them, there should be conditions. The auto companies should be required to focus on production of hybrid and electric vehicles with this money. Or, the government could provide people with vouchers to buy hybrid and electric vehicles, which would also pass money to the automakers, as well as benefiting people.

At the same time, Congress should (and probably will) be looking at a relief/stimulus package that will create jobs in infrastructure repairs and green energy. This will help offset any job losses related problems in the auto industry. This package should also include increases to unemployment benefits and food stamp benefits to help those who are unemployed or underemployed for some period of time.

Finally, we should also look to the bicycle and transit industries as a source of jobs. In recent years, we've seen significant growth in both transit and bicycle ridership, and bicycle manufacturers and retailers have also seen an increase in business. For instance, according to BikePortland.org, the bicycle economy in Portland, Oregon, is estimated to be worth $63 million and accounts for 800 jobs in the area. While the bicycle business will probably continue to grow, government could also put money into these growing industries to help create jobs. Perhaps a bicycle voucher or tax credit would help families purchase bicycles for transportation, and also create jobs in the bicycle economy.

Michigan governor Jennifer Granholm recently told MSNBC that the slogan now is "Jobs, baby, jobs." She's right. People need jobs, but they may end up being different kinds of jobs. If we're going to have another bailout, let's put our money into the green jobs that are necessary to our future.

Sources:

Center for Automotive Research, press release of November 4, 2008, http://www.cargroup.org/documents/CARPressReleaseNovember42008.pdf

Jonathan Maus, "Portland Bicycle Industry Worth $63M, http://bikeportland.org/2006/06/15/survey-says-bicycle-industry-nears-63m/

Federal News Service, transcript of "MSNBC "DECISION '08" INTERVIEW WITH MICHIGAN GOVERNOR JENNIFER GRANHOLM", http://www.fednews.com/transcript.htm?id=20081104t6840