It may be that General Motors, Chrysler and Ford are lumbering, Jurassic beasts that deserve their looming extinction. But only a free-market fundamentalist, a lunatic or a Senate Republican -- perhaps that's redundant -- would conclude that now is the moment to hasten Detroit's demise.
...The thing to do is give the automakers the money to buy some time. This is obvious to the current administration, the incoming administration, a majority in the House of Representatives and the Democrats in the Senate -- but not to the Senate Republicans. They killed the bailout measure by demanding that the United Auto Workers agree to sharp, almost immediate cuts in wages and benefits.
Funny, I don't recall a cry from Senate Republicans for salary caps on the stockbrokers whose jobs were saved in the Wall Street bailout. Nor, to my knowledge, have they demanded that white-collar workers in the auto companies take pay cuts. I do recall lectures from some Republicans in the Senate about how inadvisable it is for government to meddle in the workings of the free market. In my book, renegotiating labor contracts qualifies as meddling.
Marie Cocco likewise addresses the Republicans' tactics:
I must admit that when the danger of a global financial implosion became apparent in March with the taxpayer-backed takeover of Bear Stearns by banking giant JP Morgan Chase, I did not understand how all those worthless Wall Street credit swaps really could be the fault of an overpaid union welder at an auto plant somewhere in Michigan.
Heck. Despite having once listened as Republican leader Tom DeLay gave a House speech blaming the 1999 Columbine High School shootings on mothers who use birth control and the teaching of evolution in schools, I still underestimate the peculiar genius conservative Republicans show in exploiting dire, even tragic, situations to wield a partisan cudgel.
Senate Republicans' effort to break the United Auto Workers union as the pound of flesh they wanted in exchange for loans to teetering automakers -- companies that are on the brink because of a credit crisis they did not cause -- was over the top, even drawing objections from the Bush White House. The administration is now rushing to find money for Detroit somewhere in the huge pot of financial-industry bailouts, lest the automakers go down and take what's left of the economy with them.
It's obvious that the current economy cannot afford a failure of the automakers:
In its latest effort to try and stimulate the U.S. economy, the Federal Reserve cut its key interest rate to a range of between zero percent and 0.25%, and said it expects to keep rates near that unprecedented low level for some time to come.
The central bank typically sets a specific target for its federal funds rate instead of a range. The rate had previously been at 1% and this marks the first time the Fed has cut rates below 1%. Most investors were expecting the Fed to cut rates to either 0.25% or 0.5%.
Unfortunately, Senate Republicans are willing to allow the economy to collapse in order to pick a fight with organized labor. Simply outrageous.
