Is Bailout Possible Without UAW Concessions?

Future of the Auto Industry

Sen. Richard Shelby, R- Ala., on NBC's "Meet the Press" Sunday, said that investing in the auto companies was "money wasted" if they don't fundamentally change the way they do business. "It's throwing money down the drain and it won't work. It's postponing the inevitable," he said.

Also on "Meet the Press," Sen. Carl Levin, D-Mich., countered Shelby's and Schwarzenegger's arguments, saying the government made money when it bailed out Chrysler in the 1970s, that the European Union was offering similar support to European manufacturers.

"Well, this is a national problem. First of all, without any question, we've got at least 3 million jobs dependent upon this industry surviving ... This is a Main Street problem. We've got 10,000 or more dealers; they cover the country and every town of this country. The auto industry touches millions and millions of lives. One out of 10 jobs in this country is auto-related. Twenty percent of our retail sales are auto-related or automobiles," he said.

"We've done this before. We supported Chrysler when it was in this kind of difficulty. People said, 'Oh, my God, that's corporate welfare.' We made money actually by supporting Chrysler," he said.

President-elect Barack Obama supports the bailout and has called on the industry to revamp, particularly in his call for 1 million hybrid cars on the road in the next 10 years.

The UAW was pivotal to Obama's Election Day victories, particularly in Michigan and Ohio, and if Congress stalls on the bailout, Obama might have to choose between the most prudent deal for taxpayers and standing by the union.

"Obama has been talking about bailing out Detroit, but he would likely rather have Bush do it, so he won't have to choose between the taxpayers and the union," said Barry Ritholz, CEO of Fusion IQ and author of "Bailout Nation."