Andrew R Stewart 

Good job, thanks. Yes it's a quill stem. Depending on the area offerings you might find it easier to just replace the stem. A through bolt won't likely be an option as the hole doesn't go all the way through, it is "blind". Oversizing the hole and tapping to a larger bolt size will be tricky because of the lack of much extra material around the hole. Same with using a threaded insert. Both are possible but breaking through to the stem's outside surface would ruin it. Also cracking gets far more likely as the stem's "wall" gets less.

I do wonder about using a thread locker compound. If the hole's threads are not completely augered out, if the bolt does grab thread remains maybe deep in the hole, I would try thread locker compound first. It's reversible and you can go to the next and more destructive step if this doesn't work. Use as long a bolt as you can fit. Follow the thread locker compound instructions. Place the bars in the stem and secure them from moving around while the lower bolt is installed and the compound cures. Only then would I install the upper bolt and only using this bolt tighten the stem cap in place, with the bars where you want them. Do some stress tests (twist, yank, pry) on the bars to confirm all it good and tight.

Good luck. Andy.