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Originally Posted by firstdown
The problem is even with all this bail out money there is no guarantee any of this will work. We have dumped 20 billion into GM and are going to now dump another 30 billion and if that does not work they will dump even more money into GM. I'm guessing within a year we are going to dump another 20 to 30 billion more into GM over the 50 billion.
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Well, when GM spends that money, it's not going to be burned in a fire. The money that they are spending is revenue to somebody, and most likely, that somebody will be a private entity. So, the contributions of the taxpayers aren't going to be in vain in the way you are suggesting. All that's happening is that the current state of the economy is forcing you to reinvest some of what you would otherwise consider discretionary income into our economic system in the name of stability. Wheter via a bailout increasing taxes, or an increase in the unemployment tax seems like semantics to me.
We're a society that is interdependent on each other to an extent. A scenario where a major part of society could just fall out and everyone else is unaffected just isn't feasible. From an economic standpoint, the bailout doesn't guarentee the success of GM per se, but unless the capital ends up being sucked up into the pockets of shareholders, it's guarenteed to benefit the overall economy in some way.