That's what the American Enterprise Institute seems to think in a new policy brief:
Nor will GM be the only automaker affected. The principle criticism levied by opponents of the Korea-United States Free Trade Agreement has been that South Korea maintains non-tariff barriers that block imports of U.S. cars. Will the United States still make these arguments while it blatantly uses its financial leverage to block foreign auto exports into the United States?
The Wall Street Journal cited some factors that might tamp down this criticism:
The Canadian government is taking a stake in GM, which could give the restructuring a sense of multilateralism.
Some other governments may balk at challenging the U.S. because they also support domestic auto makers. The German state of Lower Saxony holds just over 20% of Volkswagen AG. The German government and the European Commission have fought for years over a German law that essentially allows Lower Saxony to block VW's major decisions.
...And notes some other potential WTO conflicts of the GM move:
U.S. support for GM has both trade and investment implications. On the trade front, the issues include whether U.S. support amounts to unfair subsidies and whether, as a government-owned entity, GM is bound by international procurement rules that limit the U.S. government from discriminating against foreign suppliers.
When it comes to investment, GM's moves overseas could face tougher scrutiny. The U.S. often closely examines investment by state-owned companies to make sure the firms are acting in a commercial rather than political fashion. That level of scrutiny might now be applied to GM overseas.
Once again, I gotta point out the double standard here. There was not a lot of hooting and hollering going on when AIG and Citi became government-owned entities, and there is certainly a case that could be made that these moves ran afoul of the spirit if not letter of the U.S. WTO commitments on financial services. To paraphrase Leo Gerard, we'll call your bailout WTO-illegal if it benefits those that shower after work, but not if it benefits those that shower before work.
(HT to Simon Lester.)