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Worthwhile Canadian Initiative?

By Matthew Yglesias  

"Worthwhile Canadian Initiative?"

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Canada has, relative to the small size of the country’s population, a pretty sizable auto industry. But that’s an industry that’s very much tied-in with the Detroit-based industry. Consequently, Detroit’s troubles are too kinds of problem for Canada. On the one hand, the companies might go bust eliminating tons of Canadian jobs. On the other hand, the companies might get rescued by the US government in a way that encourages them to eliminate jobs in Canada in order to save jobs in the US. Hence, auto bailout, Canadian edition: “Moving to pre-empt a possible shift of auto production to the United States, the governments of Canada and its Ontario province offered the industry 4 billion Canadian dollars in emergency loans on Saturday.”

The issue here, as with Sweden’s rescue packages for Ford- and GM-owned Swedish brands Saab and Volvo is that for all the same reasons we don’t want the collapse of the Midwest’s auto industry, nobody anywhere wants to see their local auto industry collapse. Instead, they want someone else’s auto industry to collapse, leaving the survivors in better shape. But not everyone can get their way on this. And at the moment, even Toyota seems to be losing money.

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