Monday, December 08, 2008

Government Knows Best

Laid off workers at a Chicago window manufacturer have made national news for their protest, demanding severance and vacation pay. Politicians and would be castrators have come out of the woodwork to show their support for the workers, who have come to symbolize the unemployed. The company shut its doors after losing its line of credit with the Bank of America.

Governor Blagojevich has decreed that the state of Illinois will not do business with the Bank of America until they loan the company enough money to pay for severance and vacation pay, arguing that the $25 million that BOA receieved in the bailout is meant to be doled out to companies that are no longer solvent.

If the company is contractually obligated to pay severance, then it should do so. However, this is in no way the bank's problem. Why on earth would they loan their depositors' money to companies that can't pay it back? If the company has to declare bankruptcy, so be it. Then the courts figure out how to reorganize the company or distribute its assets to its creditors, including, in this case, its employees.

This is what happens when liberals meddle in business. Soon-to-be-convicted-felon Blogojevich should not be telling Bank of America how to run its business. If the state can save money by doing business with BOA, he has no right to forfeit those savings to score political points. This is exactly the kind of thinking that led to the financial crisis - liberal politicians determining who should get loans. Unfortunately this idea that the government knows best how to run businesses will soon be coming to Detroit in a big way.

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