The benefits of economic growth go to everyone

About a month ago, when the auto industry was refused a bailout from Congress (I think for the first time), I wrote about possible politics behind the refusal. Senators in the South were hoping for the Big 3 to go out of business (at least get a lot smaller) so that their own factories of foreign owned automakers would grow to take up the slack. A Newsweek article is essentially saying the same thing. Here are some ideas from that article:

The Southern GOP senators don't like unions (Detroit has them, their auto plants don't) and are angry about the mess Bush has made of the financial bailout. They don't understand how Detroit works (legacy costs, union rules, less flexible factories), but they do understand how Southern plants work and wonder why Detroit can't do the same. They are quite happy that various states have given billions to foreign automakers (tax deals, subsidized power through Tennessee Valley Authority) to get the plants in their states but can't stand the idea of the feds doing the same for Detroit.

Detroit has only this year had to deal with gasoline at $4 a gallon. Toyota and others have been dealing with gas more expensive than that for several years now.

Here's another perspective from blogger Terence Heath. I used the phrase "downwardly mobile" just a few days ago in a posting about sundown suburbs who refuse to deal with those who can't maintain the lifestyle. But Terence suspects that downwardly mobile is one of the goals of conservatism. Get rid of unions and regulations and boost outsourcing until your American workers can compete in the global economy -- by being no more expensive than overseas labor. Get used to a lower standard of living.

The UAW, in a process well underway by the 1950s, created the American middle class. That spawned all the ideas that are at the center of American liberalism. Which is why the GOP hates the UAW. But why should a healthy middle class be considered unsustainable? Since the 1970s that myth has driven corporate-labor relations. Need increased profits? Take it out of labor's pay. The worker has been participating in the silent bailout since then. There are now so many unprotected workers they resent their unionized brethren.

And depressed wages meant those trying to maintain their middle class lifestyle had to do it on credit. High consumer debt is a big reason we're in the current mess. Alas, many are saying the way out of this mess is for the middle class to spend more. Without earning more. The only way out of this mess is for the benefits of economic growth go to everyone, not just the rich. Assuming conservatives want economic growth.