This is the part of our nation’s surreal economic crisis that seems particularly surreal:
The US auto industry, which employs 3 million Americans in auto plants, parts and supplier networks and dealerships nationwide is broadly understood as being essential to maintaining America as an industrial force. It’s financial collapse, which even critics of moves to bailout the industry suggest is imminent, would devastate workers, retirees and communities in every state of the nation. Despite the grumbling from anti-union zealots, the auto giants have radically retooled in a manner that makes the cost of producing a vehicle at a unionized plant of General Motors, Ford or Chrysler roughly equivalent to the cost of running a car off the line at a non-union plant. And to top it all off: Auto plants actually produce something that most Americans consider to be useful.
Yet, proposals to provide what now seems to be a very small bailout — $25 billion — are currently stalled.
At the same time, the whole of the federal government is scrambling to buy as much as $50 billion in “toxic assets” — bad loans and other products of irresponsible financial practices that are of dubious value — from Citigroup, a global banking concern that makes money by charging working families exorbitant interest rates for credit. According to the Wall Street Journal, “[The move to protect the banking concern] would mean taxpayers could be on the hook if Citicorp’s massive portfolios of mortgage, credit cards, commercial real-estate and big corporate loans continue to sour.”
Perhaps, in some wild calculation of American interest, Citicorp is worthy of a bailout.
But what mad calculus would make Citigroup more worthy than the auto industry?
And why the urgency with regard to Citigroup and the casual disengagement with regard to the industrial giants that, for all their flaws and perils, remain what Barack Obama correctly described as “the backbone of American manufacturing”?
Something is fundamentally wrong with a federal government that offers bankers a bailout and autoworkers as cold shoulder.