Tuesday, December 16, 2008

CQ bailout reporting bias

Specifically, those who are for the auto bailout are "pragmatic", and those who are against it are being "ideological" and "populist". (Link: "Bailout Season Has Republicans Choosing Sides")

On one side are pragmatists such as President Bush and the Republicans in Congress whose home states would be hardest-hit if auto manufacturers and their web of suppliers and dealers were to disappear.

On the other side are Republicans who believe so deeply in the conservative free-market philosophy that they oppose bailouts, either the huge $700 billion package (PL 110-373) Congress passed after tumultuous debate during the presidential campaign or one aimed at a unionized auto industry anchored in Midwest states where GOP fortunes already are sagging.

Just to set the blog record straight, I was for the financial bailout, but am in the Corker corner with respect to the auto bailout. And somehow the financial bailout did manage to pass...

Only in the 15th paragraph does CQ decide to mention Senator Corker's proposal, calling it "nuanced".

The difference with the auto companies is that while the banks had/have a problem that could be solved with large amounts of free money, the auto companies don't. There is a fundamental structural cost issue that must be resolved for the autos to be viable. Bob Corker understands this, and so do a lot of Republican Senators.

But back to CQ:
William Bianco, a political science professor at Indiana University, said anti-bailout Republicans had made a savvy political calculation that they could satisfy their base by scuttling a congressional auto bailout, knowing that they could score ideological points while feeling sure that Bush would intervene in any event.

"Everybody knows the game everybody is playing here. Republicans are playing to the politics of their districts with the firm expectation their actions in blocking the House-passed $14 billion loan package would have no policy consequences, because the industry will get bailed out anyway. If they’re wrong, they could be in trouble,” Bianco said.

Or, alternatively, the Republican Senators knew that a free money bailout was pointless, and are actually angry with Bush for potentially caving in? Also, the professor seems to suggest it's an "ideological" point, but one that they also didn't really believe.

When I was taught Political Science there was at least a theoretical pretense of neutrality. The idea seemed to be that it didn't matter whether or not politicians believed what they said, but academia didn't so far as to claim to know what was in their heads.

And this is just downright inconsistent:
Stan Luger, a political scientist at the University of Northern Colorado who has studied auto industry history, predicted that the nuanced stand taken by Sen. Bob Corker , R-Tenn., would be popular with some constituents, such as the non-union workers at the Nissan factory in Smyrna, Tenn. Corker’s plan would have required big wage concessions by the United Autoworkers Union as a key part of any deal.

"We have taken a very thoughtful stance. I don’t think it’s going to hurt us," Corker said.

"The South has taken over the Republican Party ideologically, They are taking a populist stance against bailouts. It will not be popular with unions. But it may appeal to workers for foreign automakers that do not need bailouts," Luger said.
Last I checked, the South was a region, not an ideology. Second, last time I checked, Tennessee was in the South - yet Corker, a Senator from Tennessee (and thus the South) had a "nuanced" plan, not a "populist" anti-bailout stance. And Corker just happens to be the lead Republican Senator on this issue.

Additionally, the transplants suffer if the parts suppliers suffer, so the idea that Big-Three bankruptcy is an unmitigated good for the foreign manufacturers is bogus.

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