The Beltway
An occasional column by Gabe Nelson, Automotive News' D.C. correspondent, analyzing the auto industry's relationship with Washington.
GABE NELSON

Washington's verdict: Bailout? What bailout?

COMMENTARY
Gabe Nelson is a reporter for Automotive News and is based in Washington, D.C.
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WASHINGTON -- Dan Akerson was running his victory lap. And who could blame him?

A week earlier, the government bailout of General Motors had ended in earnest, and Akerson, the departing CEO, couldn't help but celebrate at the National Press Club, where he delivered a bit of Washington-style spin so obvious he might as well have winked into the camera.

GM, he said, had just announced in Flint, Mich., that it would pump nearly $1.3 billion into plants in the Midwest, bringing its investment in U.S. facilities to $10 billion since 2009.

"There's that 10 billion again," he said.

Of course, $10 billion happens to be about how much the U.S. Treasury lost on its investment in GM.

Akerson demurred when asked whether GM was planning any kind of publicity campaign to highlight that symmetry. But one can already imagine the ad copy: "Every dollar spent by taxpayers has been reinvested back into the U.S. economy."

It was clear that Akerson had come to Washington with ready talking points, prepared by a public relations team that saw his speech as a moment to shape how the GM bailout is remembered.

"There are very few countries in the world that don't help their key manufacturing sectors." GM CEO Dan Akerson

Point 1: The alternative to the bailout would have been far worse.

Point 2: GM is financially healthy again and is winning scads of awards for its products.

Point 3: The company fulfilled its obligations to the government based on terms the government devised.

And so, when asked at the podium whether GM would consider unlocking some of its $27 billion cash hoard to compensate taxpayers for their loss, Akerson stayed on message.

"There are very few countries in the world that don't help their key manufacturing sectors," he said. "Believe me: I see it every day when we compete against them, whether it be in Europe or Asia, it's there. The question is, was it a good investment?"

Five years ago, that question was debated feverishly in Congress. But now, no one in Washington seems able to work up the energy to debate it. The bailout era, born of fire, has ended with a whimper.

One of the few people in Washington with anything to say last week, for good or for bad, was Darrell Issa, the Republican chairman of the House Oversight Committee, who earns some votes just by criticizing anything with President Obama's stamp on it.

"President Obama's extraordinary intervention in GM means that big corporations who make bad decisions can turn to Uncle Sam for a huge injection of taxpayer cash," Issa said, ignoring that the bailout began under President George W. Bush.

Washington's fading interest meant a thin crowd for Peter Flaherty, the president of the National Legal and Policy Center, an anti-union group that reviles the bailout, as an intrusion into the free market, especially as one that helped the UAW.

Just before Akerson's speech, Flaherty delivered a rousing critique of the bailout, insisting that GM should pay back the taxpayers -- rousing, perhaps, to the five people who were in the room, not including the cameraman. Two of them were Flaherty's colleagues.

How did the auto bailout, one of the most dramatic industry interventions in the history of the United States, become such an afterthought in the city that engineered it?

Well, in politics, you don't criticize a winner. Just ask Mitt Romney. In last year's presidential race, he stepped in political dog waste by asking why President Obama picked "losers" such as Tesla Motors, even when the consensus was that Tesla had become a winner, and insisting that he would have handled the auto rescue better.

Picking a loser is bad, but picking on a winner is worse.

And right now, GM looks a lot like a winner: profitable, out of government hands, making acclaimed products that people want to buy. To most experts, the bailout looks like a winner, too.

And GM is right that in a global auto industry, part of doing business is extracting favorable treatment from the government and the citizens it represents.

For the Treasury to come to GM now shaking a can of change would be political idiocy. The bailout is over, and no one is looking back.

And so, year by year, the memory of the bailout era will fade in Washington. As long as GM can remain in the winner column, Akerson will be remembered fondly here.

Or, if GM is truly successful, he will hardly be remembered at all.

You can reach Gabe Nelson at gnelson@crain.com.

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