Worthwhile being clear that a zero-interest loan is two things:
1. Providing useful liquidity when financial markets can't or won't.
2. An implicit subsidy where the govt pays to borrow, then lends at a lower rate. Why are we (effectively) *giving* cash to these guys?
1. Providing useful liquidity when financial markets can't or won't.
2. An implicit subsidy where the govt pays to borrow, then lends at a lower rate. Why are we (effectively) *giving* cash to these guys?
Also worth noting: The oil and gas industry employs mostly machines and very few workers. Coronavirus doesn't much hurt this industry. And their major asset—the energy locked in the ground—is still valuable even if current mining companies go belly up. (Also, they pollute.)
Bailing out the oil and gas industry would simply be another example of socializing the losses and privatising the gains.
There are sectors of the economy that really need help right now, and targeting that aid isn't a bad idea. Targeting this industry is, though.
There are sectors of the economy that really need help right now, and targeting that aid isn't a bad idea. Targeting this industry is, though.
