Anyone who starts a business has to realize pretty quickly that they have a silent partner, and there's no getting around it. With the auto industry, due to all kinds of regulations and restrictions the silent partner has placed on it, the partner ain't all that silent. While management answers to the stockholder's demands for profitability, and thus keeps on making gas-guzzling SUV's with the foresight of the future taking a back seat, the unions keep biting the hand that feeds it, again, with their own foresight taking a back seat, the silent partner keeps introducing regulations and various mandates without concern for the overall effects on the company or the industry. Now, everyone has to work together to bail themselves out, the silent partner included. So to say let them fail, or let business take care of business, is a little short-sighted and too simplistic.
If the UAW dried up and blew away today, not much would change, as their heyday of importance passed long ago. Their reason for coming into being was a good one, and a needed one, and they've done many really great things over the years. But they no longer serve their own purpose and are far more of a detriment to themselves, their industry, and the very people they portend (and pretend) to serve, than they are the great righter of wrongs and the protector of the worker. They're more worried about the Job Bank.
A bailout might avoid any near-term bankruptcy filing, but it won't address Detroit's fundamental problems of making cars that Americans won't buy and labor contracts that are too rich and inflexible to make them competitive.
While GM, for example, has spent billions of dollars on labor buyouts in recent years, it is still forced by federal mileage standards to churn out small cars that make little or no profit, at plants organized by the United Auto Workers, where they are paid a ridiculously artificially inflated salary.
They are going to have to retool and reinvent, and that means the company and management, the unions, and the government are going to have to do it together.
This ain't the way to do it, in any case:
UAW News Update