We’ve arrived at the point where U.S. government bailouts hardly draw commentary. The announcement that there is a deal in place for U.S. taxpayers to cover the shortfall of two mortgage underwriting firms — firms that are failing because of bad business policies, bad management, and bad oversight — is just a weekend story that will be old news within a day. Just one more bailout.

Next in line for a bailout, apparently, is the domestic auto industry, which is hoping the feds will fund $50 billion of low-interest loans the carmakers promise to use in their efforts to modernize operations and develop more fuel-efficient vehicles. (The loan, by the way, has already been authorized by federal law, thanks to last December’s comprehensive energy bill.)

Calling it a “direct loan program,” GM North America president Troy Clarke wrote in the Wall Street Journal that it “is intended to lower borrowing costs for auto makers and suppliers to invest in designing and building more energy-efficient cars and trucks. The ultimate purpose is to accelerate existing product programs in order to get these vehicles on the road quicker. And yes, these loans must and will be paid back.”

But that’s the auto industry’s side of the argument. What explanation do federal officials offer? So much federal money being thrown at problems as a way for federal officials to give the impression that “they care” is now giving the opposite message: “Who cares? It’s just money.” It also indicates they have forgotten how markets work. By overfunding bad risks, they are wasting taxpayers' money and prolonging economic decline.

In this year alone, we’ve witnessed a hasty distribution of government money to individuals; a bailout of the investment bank Bear Stearns; and now the Fannie Mae/Freddie Mac non-outrage.

The automakers' argument that their industry will in fact advance technically as a result of the federal loans should not be the interest of the federal government. As irresponsible as Detroit has been with investor’s money, you may nevertheless be sure that some private investors would be willing to make this bet, if they thought it worth the risk.

Everyone knows Chrysler, Ford, and GM are in financial trouble: need should not be a federal consideration either. The automakers are in their current positions for various reasons, many of them “excusable,” but that doesn’t make them good credit risks. Many of these problems have been apparent for more than a decade, and still the automakers have not demonstrated sufficient commitment to improvement to change the public’s or investors’ views. Nor have they shown enough vision to persuade us they’d be responsible with the loans.

Everyone, too, knows that the difficulties of the automakers put at risk lots of other companies, and millions of workers, retirees, and investors. But let’s be clear: the responsibility for the workers and the retirees is going to fall to the federal government in any case, if the automakers fail in their obligations to them, and investors are (presumably) advised of the risk of their investments.

The issue that ought to be considered in this discussion is neither need nor risk. It’s propriety. Federal law provides a solution for companies in trouble: it’s bankruptcy. Even federal bankruptcy laws are not entirely fair to creditors, but typically the companies that declare bankruptcy don’t do so in order to prolong their profligacy and mismanagement. Bankruptcy would demonstrate a better commitment and a faster route to an automotive turnaround than federal loans can achieve.