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I agree that the the "crisis" at hand is caused by the economic downturn. But the Big Three have been losing market share for years, in particular to domestic Japanese competitors. The whole point of the bailout is really just to tide them over through a 9-month recession, so they can start sucking again at a usual level and losing market share at their normal, gradual pace.
As for wage and benefit differentials, let me just say this. I live in the industrial midwest and have acquaintances in both union and non-union auto plants, as well as union and non-union steel, both foreign and domestic. The differences are really quite noticeable, and I'm certainly no polyanna for the Japanese. For one thing, the non-union and/or foreign work forces are by definition younger (thus, much less health and retiree benefits). The Japanese also are much more ruthless, in my observation, in cutting people out -- e.g., firing 61 year olds (whether in management or on the line) on pretextual reasons before they can collect full pensions.
The reason I compare this to the Goths and the Romans is that it is not at all clear that Japanese incursions will be good for the country, over the long term. But once they are here, and dominating the market, how are you going to stop it? Taxpayer subsidies for the losing business model? Some sort of internal tariff?
The only reason I'm advocating a steep step down for the UAW is that it is the least bad alternative. And note, the Republicans are not saying let's re-write the labor laws so management can break the union directly using all manner of tactics. Rather, they are simply saying: you've got to conform to the markets, or taxpayers shouldn't pay for it.
Finally, if you compare this to other bailouts, you see both justice and injustice at work. The Wall Street bailouts were strictly for the shareholder/pension/investor class crowd, not the working man. It is indeed an indictment of America's priorities that we pass without real debate 700 billion for investors but fight like gladiators over 15 billion for the workers. However, the point of the Wall Street deal -- I guess --was to effectively recapitalize shattered lending corporations (within existing shells, and existing shareholders) so the rest of America would have someone from whom to borrow. It's harder to see the greater public policy in the GM bailout. As I said before, subsidizing above-market wage and benefits is not good enough, at least for me.
