Had the big three gone way...several hundred thousand jobs would have gone with them. In my opinion, a very good investment when these jobs were a major issue (remember).
If we take a loss on GM....chances are Chrysler profit made up for it in spades.
Who said you would lose more jobs if you let them fail? There was certainly value in some of those companies and brands- they would have gone through bankruptcy and someone would have picked up those assets. Just like you aren't going to see Hostess brands like Twinkies gone forever, you would not have seen Ford gone.
This sort of bailout is a moral hazard and creates a culture of carelessness- remember it was only a couple decades back that they were bailed out too.
The other thing is that even if we lost some of those brands or whatever- so what? The number of jobs they create in the US vs. what Toyota, etc, creates is not heavily in favor of GM. In fact, Cars.com does a list every year of the most "American" cars as judged by how much of the car and
car parts are made in the US. The Camry has been number one for a while now- Toyota (and Honda) actually buy or build a lot of their parts domestically that GM outsources.
The only argument that might have some validity in my opinion (and that I have heard) is a potential fiscal shock that might result from such a collapse which could have been detrimental to the already weak economy. In that case I think there were still better solutions- keep more of the bankruptcy structure, but do it through government support over a longer period of time. In that case the Treasury might still have taken a hit, but we wouldn't have the moral hazard.
Oh one more possibly valid argument- American morale. They were American companies, we are American, whatever. I personally don't think it is worth the taxpayer burden and future risk to uphold car companies in the name of America, but some might I suppose.
