Hermits Rock

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When the banking buyout was proposed, Henry Paulson and Ben Bernanke argued vehemently against curbing executive (or for that matter, anyone in the financial industry) pay. They said that it was important not to cut bonuses or their salaries in order to encourage them the heads of firms to ask for money from the U.S. government. (Bear in mind that more than 100 people at Merrill Lynch took home more than $20 million in 2006. The bonus pool that year was between $5 and $6 billion.) Congress (in some cases grudgingly) agreed.

Two months later, Senate Republicans scuttled the auto industry bailout because the insisted that UAW members take an immediate pay cut. The $50 thousand or so dollars that factory workers earned per year was simply too, too rich. UAW refused, and today Chrysler is shutting down for the rest of the year.

What in God’s name is right about this story?