Smash the State
Posted by aogMonday, 01 June 2009 at 08:10 TrackBack Ping URL

I have been following the claims that closures of Chrysler dealerships have been politically motivated and wondering if the evidence was strong enough to justify a post. I didn’t wonder a bit, though, at Old Media’s strong lack of interest in investigating the issue.

But what did occur to me while reading this is how much easier it is to close dealerships now than it was before Chrysler was purchased by the Obama Administration. Car dealerships are generally strongly protected, in an almost guild like fashion, by state and local law, which prevented the Big Three from adjusting their dealer networks to suit reality. The Obama Administration, however, can simply ignore those laws as it goes about its business. A classic case of government creating a problem and then claiming it requires government to fix it, rather than say removing the government cause that created the problem in the first place.

Comments — Formatting by Textile
Harry Eagar Thursday, 04 June 2009 at 20:42

Well, it wasn’t Democrats who pushed franchise laws through state legislatures.

Chrysler is trying to shut down the dealer here, but that doesn’t play very well into the conspiracy theory, since the dealer is 1. a minority, and 2. a Democrat.

One way the Old Media deals with this is to ask. So I asked. He thinks they are shutting him down because he would not order more cars than he could sell.

Market power at work, I guess.

joe shropshire Friday, 05 June 2009 at 11:16

Not really. If the market had anything to say about it there’d be no more Chrysler to deal for.

Harry Eagar Friday, 05 June 2009 at 16:21

I was being sarcastic, but only in part; because I know the history of Ford and his dealers, when he was able to make them take more cars than they could sell.

It’s a famous incident in the history of the auto industry and one of the many such that contributed to my scorn for the pieties of free marketism.

Post a comment