When the United States federal government bailed out financial institution in trouble, it said that doing so was necessary to prevent the economy as a whole from collapsing suddenly. If these institutions were not helped, the government said, the entire economy would suddenly collapse, leading to the scenes not seen since the Great Depression.

Fair enough. Many commentators agreed with the federal government or were at least willing to accept its explanation.

But today, something else happened: the U.S. government is now considering bailing out the automobile industry. Again. Throughout the years, America’s dying automobile industry has received government handouts and loans, yet to no avail. The industry continues to be in trouble, mostly because it is simply unable to compete with better and more effective car manufacturers in other countries.

The industry has declared itself “vital” to the U.S. economy and has called on legislators to help them out. Again.

“The companies are desperate. They need help,” Rebecca Lindland, director of the autos group at IHS Global Insight, an economic consulting firm in Lexington, Mass. said. ”For the country this is our version of ‘Joe the mechanic,’ and if Joe loses his job, the ripple effect is tremendous.”

Of course, that is nonsense. The automobile industry employs many, sure, but not every single car manufacturer will fall if not bailed out by the government. Automakers in trouble will not, in any way, take the entire economy with them. Sure, people lose their job, and some areas may be hit, but it will have almost no impact on the economy as a whole.

Aside from the above, the following should also be taken into consideration: capitalism and the free market demand that when a specific company can no longer compete, it will either have to go down or change. If these companies are bailed out (time and again), they will not strengthen but weaken the economy, as can be said about the automobile industry which has cost the American taxpayer billions of dollars.

No, automakers will have to save themselves. If they cannot, the free market dictates they’ll collapse thereby making the economy strong rather than weaker.