Last night, the Senate rejected a bailout for the U.S. auto industry, thanks to a Republican filibuster. This was after Dick Cheney -- Dick Cheney! -- tried to bully the GOP Senate leadership into supporting the bailout, warning them, "if we don't do this, we will be known as the party of Hoover forever."
Why are Senate Republicans -- and Dennis Rehberg -- killing the auto industry, when they rushed, without question, to bail out the rich executives and stock brokers of Wall Street investment firms and banks?
Union wages. The deal essentially fell apart over wages for US union workers. The filibustering Republicans wanted union wages to be slashed, now, not in 2011 when the union contract expires, to match Japanese wages.
To begin with, the disparity between the average wages of Japanese and US autoworkers is misunderstood and exagerrated. The Notorious Mark T has been over this already, noting that the difference is in part the "legacy costs," the money owed in health care benefits and pensions to retired workers, which we know is the result of US big business' antipathy towards universal health care. The wage figure also includes wages for white collar workers, and the fact that the auto industry is shrinking, so there's fewer entry-level wages being doled out. And, as John Judis points out, the Japanese wage is also the result of the industry's practice of building plants in "right to work" states and deliberate undercutting of workers' wages. That is, their wage is a result of "despicable" corporate behavior.
Judis also questions the urge -- driven by ideology -- to cut wages during a recession:
Of course, this is not just about automobile companies. If you look at the history of the Great Depression, what tipped that event from a global recession to depression was precisely a series of dumb, craven--or in Keynes' word, "feather-brained"--moves by politicians blinded by ideology or by narrow self-interest. An interest rate hike here, a balanced budget there, a spending reduction or two, and we went from ten to twenty percent unemployment. Don't imagine for a moment that the failure to bail out the auto companies isn't one of those feather-brained moves.
Put it this way. What we have learned from the economics of the Great Depression is that in order to end the spiral of unemployment, government has to throw money at companies and consumers. It should be trying to raise wages, not lower them. The Wall Street bailout was a fiasco, but it was probably better than nothing. And the auto bailout was considerably better thought-out. Now there is a good prospect that two of the Big Three will fail, jeopardizing, perhaps, as many as a million jobs. That's exactly the kind of thing that Americans should not be doing. But don't tell that to those great patriots Corker, DeMint, or Shelby. They know better.
And as, again, Mark T notes, Republican ideological hatred of unions and union workers is out of step with Americans' views. And why do Americans cherish their unions? I think Nicole Rosenleaf sums it up ably:
I come from a long line of union folk, and while many out there would like to convince us that unions (be they of automakers or teachers) are the root of problems ranging from the decline of the auto industry to the much-trumpeted but not much-evidenced crisis in education, I'm not buying it. Unions provide a necessary counterweight to a corporate world that is driven only by profits. Enlightened companies and corporations recognize that happy, healthy employees are productive employees, but not all companies are enlightened. By any stretch of the imagination.
We've already lost a lot of ground as workers, and that has translated into a middle class that is barely holding on. Further marginalize the unions and that's only going to get worse. It's time we start holding those who--in the words of one commentator I heard yesterday--shower before work to the same standards that we're demanding of the people who shower after.
Frankly, I wasn't in favor of a bailout for the big banks and investment firms, largely because they created the current economic crisis with their free market ideology, their speculative, phony profits, and their unfettered greed. And the Wall Street bailout had no oversight, no coherence, no strings attached.
While I'm not crazy about rescuing businesses that aren't competitive -- and much of the auto industry's woes are of their own making -- they, at least, make something. And having large manufacturing plants around is in the interests of our national security, as well. Saving the auto industry will ensure that people -- regular middle class folks -- get paid. And in the end, the economic future of our country does not rest with the self-appointed Captains of Industry, the Monarchs of the Market, the Potentates of Profit, but with the middle class, the people, consumers and workers.
Unfortunately conservatives of a certain stripe have for years now been waging a systematic class war on ordinary Americans, and last night's vote was perhaps a last gasp of that movement, but a gasp that might have disastrous repercussions.
