After the House approved the auto bailout (or “rescue plan”) by 237-170, in the Senate it fell short of the 60 votes needed to even bring it up for consideration. The Senate voted 52 to 35 (in favor: 40 Democrats, 10 Republicans and 2 independents).

UAW accused GOP senators of “singling out” unionized workers.

A few of those GOP demands were reduction of pay-and-benefits to foreign-owned automakers levels; reduction of Big Three contributions to the retiree health care fund; and elimination of the infamous Jobs Bank and some supplemental unemployment benefits. In other words, matching the non-unionized automakers operating in the South.

Some say it’s an attempt to use the credit crisis to restructure labor in the auto industry, where unions have ruled for 60 years. Perhaps put one of them in bankruptcy, which would force labor renegotiations under new light. And, why not, perhaps even liquidate one of them: the field is just too crowded. Talks of a merge are not so quiet anymore.

But think of it the other way: this might be the last chance of a settlement on these terms. Starting February, a new, labor-friendly White House and Democratic majorities in House and Senate will certainly play a different tune. Obama already admitted he would pass the “card check” legislation, abolishing secret ballots in unions.

Then, next step for the UAW will be to visit those southern, non-unionized auto plants in Alabama and Tennessee.

Automakers might get covered with a TARP

Automakers might get covered with a TARP

In a reversal from previous announcements, White House now backs using the TARP (those $700 billion) for the automakers. Treasury Department promptly indicated that it would provide short-term relief.

Which brings us to the most interesting part of the story. Almost 500 elected legislators, representing the people, reject the automakers bailout through the normal legislative process. But 1 unelected bureaucrat, with $700 billion in hand and sweeping discretion to decide who gets it, how, and under which conditions.