Sunday, 8 December 2013

Should government keep topping up failed business?

Here is a dilemma any politician must contemplate. When a business becomes the major employer for a region, it is in a position to demand more and more support to remain in the region. Again, for any corporation, the sole objective is to make maximum profit for its shareholders. The moral issue of supporting the employees and the region hosting the corporation is only secondary. The issue of unviable car manufacturing in Australia is not new. Mitsubishi car manufacturing became unviable in Australia years ago. Subsidizing these car companies which have wrong products will only delay the inevitable. For low cost manufacturing, no one can compete with China where the major market is. The only right product is affordable electric models suitable for Australia and then the world. Large engine cars are models in the past.

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