Friday, July 17, 2009

Congress trying to prop up car dealers

The House of Representatives approved an amendment in an appropriations bill last night that would interfere with the restructuring of GM and Chrysler by requiring them to keep their dealerships open. Similar legislation is being considered in the Senate.

Legislators are rightly concerned about potential job losses at dealerships and about the loss of many small business; more than 3,000 dealerships appear to be facing closure. However, the legislation are risks the ultimate viability of the automakers and delays cuts that are as inevitable as they are painful.

By doing so, legislators are setting the stage for even greater job losses.