The US has one of the most vibrant, dynamic, and efficient automobile industries in the world. It produces several million cars, trucks, and SUVs per year, employing (in 2006) 402,800 Americans at an average salary of $63,358. That’s vehicle assembly alone; the rest of the supply chain employs even more people and generates more income. It’s an industry to be proud of. Its products are among the best in the world. Their names are Toyota, Honda, Nissan, BMW, Mercedes, Hyundai, Mazda, Mitsubishi, and Subaru. (source)

I have full faith that Congress nor Barack will not bail out the auto industry. Protectionist attitudes only cause other countries to respond in force, which just kills global trade.

The auto industry, simply put, sucks: (source) (emphasis mine)

In 1993, the legendary economist Michael Jensen gave his presidential address to the American Finance Association. Mr. Jensen's presentation included a ranking of which U.S. companies had made the most money-losing investments during the decade of the 1980s. The top two companies on his list were General Motors and Ford, which between them had destroyed $110 billion in capital between 1980 and 1990, according to Mr. Jensen's calculations.

...

Over the past decade, the capital destruction by GM has been breathtaking, on a greater scale than documented by Mr. Jensen for the 1980s. GM has invested $310 billion in its business between 1998 and 2007. The total depreciation of GM's physical plant during this period was $128 billion, meaning that a net $182 billion of society's capital has been pumped into GM over the past decade -- a waste of about $1.5 billion per month of national savings. The story at Ford has not been as adverse but is still disheartening, as Ford has invested $155 billion and consumed $8 billion net of depreciation since 1998.

As a society, we have very little to show for this $465 billion. At the end of 1998, GM's market capitalization was $46 billion and Ford's was $71 billion. Today both firms have negligible value, with share prices in the low single digits. Both are facing imminent bankruptcy and delisting from the major stock exchanges. Along with management, the companies' unions and even their regulators in Washington may have their own culpability, a topic that merits its own separate discussion. Yet one can only imagine how the $465 billion could have been used better -- for instance, GM and Ford could have closed their own facilities and acquired all of the shares of Honda, Toyota, Nissan and Volkswagen.

Basically put, the auto industry destroyed a lot of capital, when it could have bought out all those successful companies (and would probably have run them out of business too, really). They are not good businesses - they suck at making money. So why should we continue to bail them out?

It's a bit of a different beast with financial companies - they are being held captive by a massive liquidity crisis that is toppling whole sovereign nations. Such an external shock requires a lender of last resort, but by my observations, the auto industry wasn't subjected to a once-in-a-lifetime external shock (a bad economy doesn't count - if we use that excuse, then we should bail out everybody) - they were poorly run companies.

Had the auto industry not placed so much emphasis on cars, maybe they could have weathered this storm. Look at Porsche or GE - these are both companies that were build stuff, but most of their profits are derived from other arms (although both have been suffering as of late with the credit crisis).