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Why another GMAC bailout is (especially) bad for America

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The Wall Street Journal reports (subscription required) that GMAC Financial Services Inc. (NYSE: GKM) is seeking a third round of bailout funds from the Treasury Department ranging from $2.8 billion to $5.6 billion. This is, the WSJ writes, "a stark reminder of how some battered financial firms remain dependent on government lifelines."

Here's what is so incredibly so screwd up about this: GMAC provides financing for car buyers. Any personal finance expert will tell you that borrowing money to buy a car is one of the dumbest things that you can possibly do.

By shoring up GMAC's capital structure and therefore its ability to continue making car loans, the United States government is providing the means for Americans to get themselves into horrible financial situations.

That's unconscionable and it's immoral.

Our elected officials are now pitting the health of the auto industry against the financial well-being of families all over the country, and they're doing it under the guise of helping the economy.

News flash: in the long run, using taxpayer dollars to finance financial overextension will not lead to prosperity.

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Last updated: November 22, 2009: 12:17 AM

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