Romney, GOP alienate the U.S. auto industry, Midwest states
I checked this morning to make sure it exists, but there actually is a well-organized group called Republicans for Obama that was launched in 2006, according to its Web site.
The group should set up shop in Michigan or someplace in the Midwest where there is a General Motors or Chrysler operation. The industry’s constituency essentially has been abandoned by the current group of Republican presidential candidates.
Last night, in lock step, the GOP candidates said they opposed the 2008-09 bailout of the auto industry and said it shouldn’t have happened. None of them was more hypocritical than Michigan native son Mitt Romney, whose father once ran American Motors Corp. (which was acquired in 1987 by Chrysler after the U.S. government rescued Chrysler in 1979).
“My view with regards to the bailout was that, whether it was by President Bush or by President Obama, it was the wrong way to go,” Bloomberg quoted him as saying during the event in suburban Detroit.
Unlike most Republicans, at least Romney acknowledged the bailout was initiated by fellow Republican President George W. Bush. Otherwise, he was all wet.
The nouveau myth being perpetuated by Romney and other Republicans is that General Motors and Chrysler should have been put in bankruptcy sooner, and that they should have been reorganized with private money.
That’s nonsense and Romney knows it.
At that time, there was no private financing available to provide debtor-in-possession reorganization money for companies the size of the automakers. The money didn’t exist because of the nation’s financial crisis. And even if the money did exist, no private investors would have been interested in bringing the companies back out of bankruptcy at that time.
Quite simply, if Romney and the others had their way, GM and Chrysler would have been liquidated -- and the economy of the Midwest would have collapsed. Anyone in the know back then, including former Michigan Gov. Jennifer Granholm, has said so.
Another myth from the GOP hopefuls: That the bailout will “cost” taxpayers $15 billion. We don’t know yet how much the bailout will cost, if anything. It will depend on the stock price of GM and Ally Financial -- and when the U.S. Treasury decides to sell its stakes in those two companies. We’re also not counting income tax revenue generated by anyone who depends on GM, Chrysler, or Ally Financial for their livelihood.
For his part, Michigan’s current governor, Republican Rick Snyder, wouldn’t join with the ideological robots from his own party.
"It wasn't just one or two companies at risk, but the entire national supply chain," Snyder told The Detroit News. "Losing that would have had a devastating impact on the economy."
But after last night’s blatant display of ignorance about the auto industry and the Midwest economy, Romney and the GOP can forget about getting any traction next year in key swing states such as Michigan and Ohio -- which are wedded to the auto economy. They’ve now given these states to Obama.
You can reach Philip Nussel at email@example.com.