More Double Standard Puzzles

This K-Drum post encapsulates much about what I find strange about the way some liberals have been discussing the American auto industry. First of all, is there any other context in which progressives would uncritically use the conserveratrian formulation “wage problem”? Am I supposed to be cheering for Wal-Mart to crush Costco because of the latter’s “wage problem” while shopping at the former besides? When he watches American Dream, does Kevin cheer for the Hormel executives? Call me crazy, but I’m inclined to think of the generous wages and benefits accorded to their workers is a point in Detroit’s favor. (And if you think that wages at non-union American factories will remain at their current level if Detroit stops competing for labor, I have some beautiful condos in Flint to sell you.)

Similarly, I don’t really know on what basis Kevin and Leonhardt assume that it’s impossible for GM, in particular, to be a viable company after a bailout. (Chrysler, I’ll grant, is a tougher case.) GM has several lines of cars that are of both good quality and with at least decent consumer demand — Chevy sedans, trucks and SUVS and Cadillac most notably. If it can develop a decent compact like it redesigned the Malibu — which hardly seems impossible — that seems like a perfectly viable operation to me. Of course, GM needs to ditch Pontiac/Saturn and/or turn them into small divisions producing cars for rental fleets. But this is precisely what justifies a bailout — closing down product lines is enormously expensive, and this restructuting will require cash. Similarly, in the long term it would be good for Detroit to produce more small-margin compacts and fewer high-margin SUVs…but again, if you run out of cash while effecting the transition this is hollow advice.

The devil is in the details, of course. But Ford and GM, at least, are producing some quality cars that people in fact are buying, and it’s by no means obvious that they can’t be profitable companies after the Bush Depression turns around. Given the stakes involved for the American economy and American labor, government money that permits product line consolidation and development with longer time horizons certainly seems like a good gamble to me. And if Chrysler has to be carried along to ensure that suppliers don’t crater while the economy is awful, I can live with that. If they develop something to go along with their minivans and trucks they could have some value in a merger, if not let them die when the consequences are less dire.