Former President George W. Bush is defending his $17.4 billion bailout of the U.S. auto industry in his memoir, Decision Points.
The Detroit News, citing an advanced copy of the book, reports that Bush knew he would bail out Chrysler and General Motors on Nov. 11, 2008 -- four days after GM announced it was teetering on the edge of bankruptcy.
Bush made the decision to rescue the troubled automakers earlier than people realized, according to the book.
In fact, the paper reports, Bush told then President-elect Barack Obama about his decision days before he informed his advisers.
Saying he had to “save American workers and families from widespread collapse,” Bush also considered his successor in the decision.
“I told Barack Obama that I wouldn't let the automakers fail,” Bush writes. “I won't dump this mess on him.”
Bush says he favored the $25 billion retooling plan sought by the automakers but it was shot down by Senate Republicans.
He circumvented Congress by diverting funds from the Troubled Asset Relief Program, originally intended to rescue Wall Street.
"Nobody was more frustrated than I was. While the restrictive short-terms were better than an outright bailout, it was frustrating to have the automakers' rescue be my last major economic decision."
But in the end, Bush writes, he had little choice.
"With the market not yet functioning, I had to safeguard American workers and families from widespread collapse. I also had my successor in mind. I decided to treat him the way I would like to have been treated if I were in his position."
Bush blames the auto industry's woes on “decades of poor management” that “saddled automakers with enormous health-care and pension costs. They had been slow to recognize changes in the market. As a result, they had been outcompeted by foreign manufacturers in the product and price,” the News reports.
In his book, Bush also discloses that he rejected a request for a bailout before the 2008 presidential election from then-GM CEO Rick Wagoner.
The former president says he reversed his stance that government should stay out of the auto business when he saw how a bankruptcy would leave the economy.
“My economic advisers had warned that the immediate bankruptcy of the Big Three could cost more than a million jobs, decrease tax revenues by $150 billion and set back American's GDP by hundreds of billions of dollars,” he writes.
After taking office, President Obama expanded the auto bailout, funneling an additional $60 billion to the auto industry while forcing GM and Chrysler to restructure under government-led bankruptcy.
Bush's memoir comes out today.
