When Lyndon Johnson signed the Civil Rights Act in 1964, he reportedly turned to his press secretary, the now well-known journalist Bill Moyers, and said, "We have lost the South for a generation."
I think it's safe to say we've seen something similar this week. Mitch McConnell and Senate Republicans blocked a bailout for the auto industry late Thursday night, leaving the Big 3 and the hundreds of thousands who rely on them for their daily wages in the lurch. Here's the key point: McConnell and company didn't decide that ruining Christmas for thousands of families was worth it because they felt Detroit needs to be retrofitted for a 21st century economy and that that fundamental realignment can only happen by scrapping the whole operation and starting over under new management. That would be a legitimate reason for opposing the bailout. I'm not sure I agree with it — if we have hundreds of billions for the financial industry, I'm sure we can find some for the automakers that the government can tie to innovation benchmarks and new management quotas. But it's a reasonable position to take.
No, the GOP decided that they would block the auto industry bailout because they couldn't take a big enough jab at the United Auto Workers union. Both Democrats and the UAW agreed that Detroit's workers should lower their wages and reduce their benefits to match those of Toyota, Nissan, and Honda workers in the United States. They wanted to do it by 2011. The Republicans wanted it done by 2009. And because that difference couldn't be resolved, the GOP blocked the bailout and likely cratered a massive segment of the Michigan economy and a significant segment of the American economy.
And that's why I say Michigan — as recently as November a crucial presidential swing state — won't vote Republican for a generation, or more. Republicans can crow all they want about how they are letting the "free market" reign, but the free market doesn't vote. Everyday people, who understand the Republican Party opposed a bailout of their industry because the screws being twisted on them weren't being twisted enough, well, they do vote. And they'll likely do anything they can to vote against McConnell and his pals.
Update: There are two possibilities for saving the auto industry at this point. (1) If the Big 3 can find a way to limp through the holidays, the enlarged Democratic majorities that will take office on January 6 will find a way to pass a bailout, which the White House will then sign. (2) Treasury can bail out the auto industry using TARP funds. There are already hints that this will happen.