I agree with most of Harold Meyerson's argument for bailing out the UAW (and I'm glad he brings up the fact that in 1949, the UAW, under the visionary leadership of Walter Reuther, tried to compel Detroit to make their cars smaller and cleaner and cheaper, and were rebuffed), but I'm having trouble believing that the government, or a government-appointed board, could really guide the auto companies back to profitability. I see no reason to believe that the Obama administration could appoint a commission that could step into the wreckage of GM and begin out-competing Toyota. But so be it. If Detroit falls apart amidst an economic expansion, then that's a shame. The argument for a bail-out, it seems to me, is not tightly related to the likelihood of GM's future profits. Rather, it's predicated on the fragility of the current economy, and the tremendous ripple effects, both economic and psychological, that Detroit's collapse would have on the Midwest. It would be nice if GM could take the loan, right its business model, and live to dominate another decade, but it's not the sort of thing that the government is likely to be able to assure. Fundamentally, a cash infusion to GM should be thought of as less of a bail-out and more of a stimulus measure.
