As The New York Times reported, a special inspector’s report for the Troubled Asset Relief Program (TARP) of the Treasury Department suggests that President Barack Obama’s automotive task force moved too quickly to force GM and Chrysler to thin their bloated dealership ranks.

Tens of thousands of dealership jobs were lost as a result, as the report noted. But while anyone can feel sympathy for dealers forced to close their doors, I prefer to focus on the hundreds of thousands of jobs that were saved: GM expects to report a full-year profit this year, and Chrysler either this year or next. The companies -- of which bailout critics were saying “let 'em burn” not long ago -- not only survived, but may be poised to thrive. But that’s happening only because Detroit was dragged, kicking and screaming, to do what it had resisted doing for decades: make tough choices and bring their costs in line to compete against Japan, Europe and South Korea.

The days when the Big Three controlled 90 percent of the market are over. Today, GM, Ford and Chrysler hold just 43 percent of the market. The Pontiac, Oldsmobile, Saturn, Hummer, Plymouth and, soon, Mercury brands are no more. Trust me: Chrysler doesn’t need more than 3,000 dealers to sell you a car. GM doesn’t need four or five times as many dealers as Toyota. Thinning the herd will make remaining dealers that much healthier, with higher profit margins that can be plowed into better facilities and customer service.

For decades, the Big Three talked a big game about breaking the bureaucracy and transforming their companies -- but nothing happened. The companies were top-heavy in management, indifferent toward quality and late to every vehicle and technology trend, from crossovers and hybrids to direct-injected turbocharged engines. It was this status-quo mentality that allowed United Auto Workers members to collect full pay for not working, in the notorious Job Banks program. It’s the mentality that saw GM apologists wring their hands over Obama’s dismissal of CEO Rick Wagoner -- as though it were a crime to hold Wagoner accountable for a sliding market share that showed no signs of abating under his well-compensated leadership.

David Cole, director of the Center for Automotive Research, said that no matter what you think about the bailout plan, the GM and Chrysler bankruptcies allowed the companies to get their act together. Freed from the retiree health-care and pension costs that were destroying them, Ford, GM and Chrysler are now fully competitive with the Japanese on key measures of competitiveness: labor costs and the number of labor hours it takes to build a vehicle. Detroit, Cole adds, now holds a significant edge over European manufacturers, which continue to delay those tough choices lest they alienate their own workers and governments. Volkswagen’s labor costs in Europe are topping an incredible $100 a hour, Cole said, once you count lavish benefits and vacation pay. In today’s ruthless global world, Cole says, those kinds of costs are unsustainable.

That means it’s better for Detroit to suck it up now, even when the economy is in the doldrums, and enjoy the payback later. Saddled with redundant dealers and paying them -- and customers -- thousands of dollars in incentives to move a bloated inventory, Detroit managed to crank out millions of vehicles while losing money on every single one. That was the old way, and it wasn't working. This time, when auto sales finally recover, GM and Chrysler are poised to deliver big profits, even with far fewer sales and fewer dealers. It was a process that was bound to involve some pain, but without it, Detroit wouldn't be able to enjoy its current gains.