What is the rationality by the Canadian government against bailing out the tech sector, while bailouts for the banking and auto sector gets an easy green light? Are tech workers any less Canadian who’s jobs do not matter?
BlackBerry (TSE: BB) recently had one of the worst quarters with almost a $1 billion loss in write-downs. BlackBerry, which was ahead of the curve in the invention of smartphones, are now at the brink of bankruptcy with $2-$3 billion in cash – and that’s running out fast! BlackBerry announced last week that they will be cutting 4,500 jobs (source), about a third of the workforce.
The Canadian government has bailed out the banking sector with $114 billion (source), auto industry with $4 billion (source) during the economic crisis five years ago, but why no such bailouts for the tech sector?
BlackBerry is not the first tech company that is in this situation. In the past, Canada had the opportunity to save jobs with a bailout of Nortel Networks, but it was decided that the company is not worth saving (source). BlackBerry may as well face the same verdict in the coming months. Both Nortel and BlackBerry were leaders in their heyday, and being the giants that they once were, have spawned off a number of other startups across the country. So, why the hatred and ignorance towards the tech sector by the Canadian government? Are the tech workers any less Canadian than bankers and auto-sector workers?
I am not advocating that every company that fails should be bailed out with taxpayer money, but what is the rationality behind saving some industries and letting others fail? This is not made clear by the politicians.
What are your thoughts on this topic?