That's the title to a post in The New York Observer, on which I'll comment but not link because it came to me as an email with Red Alert warnings about "phishing" and "potentially unsafe attachments."
Yes, I think there is a bias, but I would describe it as a bias in favor of Wall Street instead of a bias against Detroit. The financial industry has its money claws deeply into many, many government officials of both parties, and the financial industry is much harder for people to think they understand than is manufacturing. A lot of people understand the importance to the US economy and middle class incomes of the auto industry and its large supply chain, and they can more or less objectively assess the nature of problems and the proposed solutions. But when the financial industry says they must be instantly bailed out, no questions asked, or The Great Depression will recur, very few know enough to push back.
I'm not in favor of bailing out Detroit on the ground that fairness requires equal treatment of finance and manufacturing. Congress was right to send the Big 3 CEOs away with a scolding when they showed up without recovery plans. But if GM, Chrysler, and/or Ford come up with new business plans that show they can restructure their balance sheets, their off-balance-sheet obligations, reduce their overhead, produce vehicles that Americans will buy, and return to profitability in a few years, which I'm pretty sure they can do, then I would favor government acting as the investor of last resort if they are unable to raise private capital now because the financial system is temporarily broken. It would be preferable to do all the necessary restructuring without a bankruptcy filing, but bankruptcy has advantages, such as forcing creditors to accept a fair deal, and I don't think bankruptcy will result in liquidation unless there is no credible recovery plan. On the other hand, if there is no workable plan, they will just burn through whatever taxpayer money we give them and then collapse in a few months anyway.
As best I can tell, my position is like that of most Congressional Democrats and the Obama Administration. The GOP opposition seems to have two sources. Many hold to an ideology about markets that causes them to have a principled objection to government interventions, and many of them also opposed the TARP for the financial industry. The other source of opposition is that a big part of the GOP base is located in the old Confederacy, which has become the host to non-union assembly plants of foreign auto manufactures (Toyota, BMW, Benz and others). Being against a bailout for Detroit allows them to favor local businesses and workers and to stick their thumbs in the eyes of unions, both of which for them are good politics. The rest of the GOP base is in flyover territory where auto manufacturing is not felt to be important to the local economies.
Thanks to Christa for sending the question.
Skeptic
Speaking of "money claws," don't miss this story about the Senator from Wall Street in tomorrow's New York Times. For about 3 decades, the financial services industry has funded both political parties and has gotten pretty much everything it wanted.