Would You Bail Out Jaguar Land Rover?
Britain's already pledged £400bn to the banks -- a necessary step, most would argue, to prevent economic collapse. But what about further bail-outs in other struggling sectors? When is government intercession essential to the UK's economic survival?
So far, the government's resisted further requests for hand-outs, despite the appeals of those in the construction and car industries. Manufacturing union Unite has claimed that tens of thousands of jobs could be lost unless the government intervenes on behalf of the likes of Jaguar Land Rover (JLR).
But thousands of jobs have already gone at Woolworth's and other high-street retailers, in spite of the pre-Christmas VAT cut (arguably, the retailers' bailout). Those in favour of giving Indian-owned JLR a large business loan cite its iconic brand status and quality output, its export revenue -- estimated at over £6bn a year -- and the fact that it is a "viable company", not an ailing tanker like Woolies.
Local MPs of every hue are (not surprisingly) in favour of intervention, arguing that it's about more than just one company or industry -- "This is about the whole regional economy", according to Gisela Stuart, Labour MP for Edgbaston.
Publishing group Trinity Mirror's regional titles have issued an e-petition and rallied supporters around a Facebook campaign group -- a sign of the times if ever there was one -- arguing that it's a "commercial loan", not a bailout, that JLR's owner, Tata, is after. But Chancellor Darling's bailout of the banks based on "commercial terms", so that argument is a little thin unless it is bolstered by specific and enforceable payback conditions.
Reuters asks which companies are too big to be allowed to fail. Conversely, which are too small to save? Which companies -- or industries -- should receive a lifeline. When does it end?