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Published: Sunday, 12/14/2008

Politics puts economy in further peril

Shhh. Listen.That roaring silence? That's us, holding our collective breath.

We're waiting to see what happens next in the riveting drama we could call "The Automakers and the Government: A Tragedy."

Certain congressional Democrats last week expressed dumbstruck amazement at how the Senate GOP turned a bailout prospect into a game of chicken.

Certain Republicans, meanwhile, expressed their apparently born-again fiscal restraint and, tellingly, their amazement that the United Auto Workers - who, remember, already made recent concessions - wouldn't line up like lemmings to accept more cuts immediately, instead of in the next contract.

As reported by the Web site Politico.com, a GOP memo about the proposed bailout that circulated midweek explained party strategy:

"This is the Democrats' first opportunity to pay off organized labor after the election .•.•. Republicans should stand firm and take their first shot against organized labor, instead of taking their first blow from it."

As U.S. Sen. Chris Dodd (D., Conn.) was quoted saying by Politico, the GOP response "was designed to create a political problem rather than solve an economic one."

Of course, if you and your checkbook are handcuffed to Detroit, it's neither political nor economic. It's personal. When TV talking heads say some

3 million jobs are at risk, we see our own face in the mirror, or an aunt or son, or the neighbors.

Politics aside, is it true that a $14 billion loan merely delays the inevitable? Would it be more efficient for GM and Chrysler to declare bankruptcy and reorganize? Or might that drive in coffin nails by eroding whatever customer confidence remains?

Lots of intelligent and well-educated people have competing theories, but we won't know who's right until all this plays out. This global economic mess is little more than one giant experiment, being conducted in real time.

On one score, however, there's far less uncertainty: The class war being waged by Washington against blue-collar union workers is execrable.

Henry Paulson, who arrived in Washington by way of Goldman Sachs, asked legislators for their blind, unquestioning trust as he handed back billions to his one-time colleagues.

Not a word then about cutting pay and bennies for front-line workers (let alone CEOs) in the financial industry. But now Republicans think it's government's role to set wage rates?

(Don't be waylaid by that $70-plus hourly canard so often repeated about UAW workers. A New York Times analysis last week revealed the true hourly rate in Detroit averages more like $55, some $10 more than nonunion auto workers.)

I like the way Dean Baker of the Center for Economic Policy Research put it:

"The double standard here is blatant. Many members of Congress, because of their hatred of unions, are prepared to subject a large portion of the country to a depression-type economy."

But the head of the United Steelworkers union, Leo Gerard, put it best. Speaking on Rachel Maddow's MSNBC show, he said:

"We've treated the people who take a shower after they go to work much different than we treat the people who shower before they go to work."

In both cases, it stinks.



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