Yesterday Joseph Stiglitz provided another stance on the "is this socialism" debate about Obama's policies toward GM and banks:
America has expanded its corporate safety net in unprecedented ways, from commercial banks to investment banks, then to insurance, and now to automobiles, with no end in sight. In truth, this is not socialism, but an extension of long standing corporate welfarism. The rich and powerful turn to the government to help them whenever they can, while needy individuals get little social protection.
That account is certainly at odds with Ezra Klein's characterization of Obama's policies as "socialism-to-save-capitalism." But I'm not sure that "corporate welfarism" is really as at odds with socialism as Stiglitz would have it. Sure, socialists have always defined their policies as egalitarian. But what is for the working class in intent is much different in practice. I would argue that most socialist policies end up favoring established interests instead of the little guy. See the theory of the bootleggers and the Baptists for more. Clarification: here I am not talking about socialist policies as they are commonly defined in today's discourse to mean "redistribution" or "the welfare state" (which are perfectly compatible with capitalism), but rather the original definition, "government control of the means of production."
So the GM bailout fits in with a long line of socialist policies like airline regulations or trucking regulations. It was sold as a way to help the common man: both Bush and Obama said bailing out GM was necessary to prevent massive blue-collar layoffs, and the bailouts of financial institutions were similarly sold as necessary for the public interest. But, as Stiglitz argues, the main effect has been that big, established players are getting the limelight at the expense of ordinary people.