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Just how much of a role would the government have played in supporting Chrysler and General Motors if Mitt Romney had been president?
As First Read reported yesterday, the former Massachusetts governor has worked to couch his opposition to President Barack Obama's decision to bail out the two car companies -- a decision which Romney, who was raised in Michigan, is being forced to confront heading into the state's Feb. 28 primary.
Democrats and the Obama campaign have made a big issue of Romney's 2008 op-ed in The New York Times entitled, "Let Detroit Go Bankrupt," especially in light of the signs of encouragement in the auto industry since the bailout. He penned it just weeks after Obama secured the presidency.
Related: Obama touts manufacturing at Wisconsin plant
The piece, published as the automakers were facing a major cash crunch, called for what he dubbed a “managed bankruptcy.” He said the car companies needed to restructure their labor agreements; replace each company's management and rid them of corporate perks; and increase government spending on alternative energy and fuel economy research, which would benefit the industry indirectly.
Of direct government assistance, Romney wrote: "The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk." He stated, declaratively, “Detroit needs a turnaround, not a check.”
Since then, Romney has spoken publicly about the bailout, essentially trying to take ownership for the successes of the auto industry's turnaround while decrying Obama's management of the process. Romney argues that the administration basically ended embracing a variation of the strategy he originally advocated.
"The indisputable good news is that Chrysler and General Motors are still in business," Romney wrote Tuesday in The Detroit News. "The equally indisputable bad news is that all the defects in President Obama's management of the American economy are evident in what he did."
The separation between Romney and Obama on the issue of the bailout stems from two issues. First, Romney argues that interests of the labor unions were unfairly favored over some of GM and Chrysler's private creditors. The government-supervised bankruptcy did this, he argues, by allowing the autoworkers’ retirees program an equity stake in the restructured GM in exchange for providing financial support for the bankruptcy.
Second, Romney appears to differ with the president over the extent to which government itself should have stepped forward with money to help stave off liquidation of GM and Chrysler and provide for the restructuring process. The administration's approach did this in the case of GM by essentially establishing a new, restructured company in which the government became a majority shareholder. (Romney argued Tuesday for the government to divest itself from the company.)
Romney's position in the past has been that the private sector could have stepped forward to finance and more effectively manage the bankruptcy process -- especially in a way that would have treated private stakeholders in the companies more fairly.
The right-leaning editorial page of The Detroit News weighed in Wednesday:
But on the key question of whether the automakers could have managed themselves through a traditional bankruptcy without assistance from the government, Romney is wrong. The loans provided by Bush and then by Obama allowed the domestic auto industry to survive the darkest hour of its history and return to thriving operations today.
Critics also contend that Wall Street might not have been in the position to give that financial assistance to Detroit in 2009, as Lehman Brothers collapsed and global credit tightened.
But Romney appeared to add more uncertainty into his position surrounding the bailouts in an interview Wednesday on Detroit talk radio station WJR. Romney said that the government should have been available to step in and provide financing during a structured bankruptcy by way of a bridge loan -- the initial way in which the Bush administration propped up GM and Chrysler at the end of 2008.
Romney explained:
They needed to go through bankruptcy, and if, as part of that process, they needed financial help to get out of bankruptcy -- a bridge loan, or guarantees on sales of cars and so forth -- I said the government should be there to provide that. But the point was they took the wrong process, they wasted a lot of money, and ended up giving the companies to the UAW.
That doesn't necessarily mean that Romney would have pursued the exact path as the Obama administration for restructuring GM and Chrysler, but it does indicate some willingness for a more expansive role for the government during bankruptcy. Spokesmen for the Romney campaign didn't immediately respond to an inquiry seeking clarification.
But in addressing some of the political flak he's taken over the bailout, Romney added on WJR: "I don't imagine that anyone could think I had any interest other than to see the companies to thrive and survive, and that's why the original op-ed piece I wrote describes what I thought was the best way to get that done."
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Hey, I would have left this comment that Media Matters undressed is just what we expected except that MSNBC didn't get an article to publish from MM yet. What a poor excuse for the Demoncrat investigative division!!!
Try another station to get fair reporting
Bain must have bought a flip flop company....
One of the few companies that Romney actually turned around.
Too bad we did not elect a Clinton instead of Obama. For some strange reason Clinton was the only one to be able to show a budget surplus and he could only do it with a republican congress.
Romney can say whatever he wants. In the end the only that matters is the results.
Business is a gamble and ultimately the government took a gamble that the auto industry could be revived and it was. If it had failed we'd be having a completely different discussion here. I'm sure the Obama haters here will be more than happy to point out Solyndra, which was also a gamble in business. The difference is one paid off and the other didn't. That is how business is suppose to work. What was done with the banks was not business. That was a promise that those that invest in banking will always make a profit no matter how poorly they make their choices in that industry. Which is why banks are still as messed up today as they were back in 2008 when the sub-prime mortgage crisis nearly took the country down. They were not given any reason to change what they were doing. They were just handed a big wad of cash and told to do what they wanted with it. The auto industry on the other hand got told that if they wanted anything there would have to be some serious fundamental changes. Which they made and now they are back on top again. No one could have predicted if those changes would work or not. Only that they were what some people thought needed to be done to fix what was broken. That is the gamble that comes with any business. Trying to predict what will work.
Bill Clinton certainly did leave a surplus....
But what the same GOP congress did the year after he left with a GOP president sure shows that congress doesn't do much.
I doubt any other Clinton or any other president Dem or GOP could balance a budget with what Bush left.
Nobody could balance a budget with what Clinton left either. His surplus with a republican congress was no where near enough to cover his deficits with a democrat congress.
Bush couldn't balance a budget with the surplus he was left?
Huh?
Well......... not while spending out of control he couldn't.
Nope, the budget surplus Clinton had went toward paying back the SSI taxes it was taken from. Clinton left Bush with a 5.3 trillion dollar national debt.
Debt isn't a deficit.
Man some of you right wingers aren't too bright.
Bobby Jones Bia, you can bet if the auto bailouts were perceived as not working, they'd all be blaming it on George Bush. Don't you know that everything that's positive in this world is because of Obama? Everything negative is what he inherited from Bush. What do you expect from a bunch of people who don't know what personal accountability is all about. It's always the blame game with them and phony excuses.
Let's see, the auto bailouts were necessary because they were too big to fail? Is that the argument? Or too unionized to fail? But the Wall St. banks should've been hung out to dry with no bailout, is that the liberal view? Funny how the liberals are suddenly holding up GM and Chrysler as examples of "good" companies when pre-Obama they were just another "evil", greedy, American corporation. My, my how the tune has changed.
It's called jumping the gun before getting all the facts. Like BUSH did. I'm no liberal, (personally, I believe all this name calling is childish and is the cause of this deep rift within this country people like YOU are perpetuating whether through woeful ignorance or just plain bias) but I am a Dem. Some things i don't like Obama has done, however he is the commander in chief, and he is in charge of this whole country that every one is in....
I saw Santorum the other week during his victory speech blaming Obama for the bank bailouts.
Not sure what "liberals" are saying the banks shouldn't have been bailed out.
Sure looks like a possible GOP nominee thinks they shouldn't have.
Santorum, unlike Mittens, was against both the Wall St. bailout and the auto company loans. Hmmmm...I wonder where the economy would be now, if neither had taken place? I wonder how many more millions of Americans would still be out of a job, now? I wonder which 2012 foreign made car all the 'job creators' would be driving, now?
Personally I think it's great that Chrysler has paid back their entire loan, that Ford didn't receive one, and that GM is healthy again. You can disagree with that opinion....that would probably just make you....a republican. Only bad 'doom and gloom' news is good, for the GOP'ers. And if it isn't quite bad news....repubs have a way of viewing it that way, and working against improving our economy.
I don't know what is more disturbing. The fact that this man is so transparent that it isn't funny. Or the fact that the people that listen to and support him are equally/infinitely gullible.
Pick a lane Mitt...pick a friggin' lane and stick to it...moron.
You need to explain that junior!. Like I said, Clinton's budget surplus was not enough to pay off the national debt that was both inherited and added to under Clinton. Any surplus Clinton had disappeared when the dot com boom went bust in 2000. So tell me exactly what you mean because I am pretty convinced you don't really know what you are talking about.
Dude, did I say his surplus was enough to pay off what all previous president including Bus #1 and Reagan left for him?
How did the dotcom bust influence Bush #2's massive spending increases?
Dude you are pretty clueless on the issues.
rick, you are talking about at least two different things.
budgets are the yearly expenditures of the government, when they spend more than they take in, they have a budget deficit.
the debt is the cumulative amount of all the deficits. you say Clinton didn't pay off the national debt but no other president has either.
in fact besides those budgets under Clinton, no one has even had a surplus of any kind since 1969 under a democratically-controlled congess.
furthermore, the dot com bust had absolutely nothing to do with federal budgets.
So you are saying increased revenues from something like......oh say.......higher raxes have nothing to do with the budget. Or decreased revenues from smaller GDPs would have nothing to do with budget surpluses or budget deficits?
Do you have any idea how Clinton managed to balance the budget?
Common
'Massive spending increases'? What is MASSIVE about---
2001Surplus----128,236,000,000
2002 Deficit ----157,758,000,000 2003 Deficit ----377,585,000,000
2004 Deficit ----412,727,000,000 2005 Deficit ----318,246,000,000
2006 Deficit ----248,181,000,000 2007 Deficit ----160,701,000,000
2008 Deficit ----458,553,000,000
Notice if you will that the Deficit went DOWN every year AFTER THE BUSH TAX CUTS!! I wonder why that happened. The Deficit went UP in 2008. Who was in charge of the Congress in 2008?? DEMOCRATS!! We had a Recession start in 2007 but the Deficit still went down,WHY??
Now look at Obama
2009 Deficit ---1,412,688,000,000 Part Bush until Mar 2009. From Mar 2009 ALL OBAMA!!
2010 Deficit---1,293,489,000,000 2011 Deficit ---1,645,119,000,000
2012 Deficit---1,101,237,000,000
Now WHO DID THE MASSIVE SPENDING??
http://www.whitehouse.gov/omb/budget/Historicals
Look at Table 1.1 You'll need Excel to read the tables.
one of the benefits Clinton had was higher tax revenue. putting tax rates back to those levels would help greatly, but Grover won't let his minions raise them
BTW. Don't even mention unpaid for wars. They were 'paid for'. Just look up Overseas Contingency Operations.
Here is a start for you.
http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/overseas.pdf
Democrats could have voted NO on each of those Bills but didn't ,WHY??? They could have used the Filibuster to stop the Funding. They didn't,WHY???
Phil
Can you explain why the Deficits from 2004 to 2007 WENT DOWN??? Those years are after the 2003 Bush Tax Cuts.
If you are talking about the following statement junior you need to be painfully aware that Clinton did not show surpluses until his second term.
Takes time to chip away at the deficits Reagan and Bush #2 were running.
Jeeze man, you need to get educated and take the partisan johnson out of your mouth.
Then why in the hell did you expect Bush to pay off the debt? It would have taken 625 billion/year for Bush to pay off the deficit.
Maybe you should get your nose out of Obama's chocolate chute.
Everyone have a great evening from both of the right and left. What would Mr. Romney had done??!!! Even people on the right know what he would've done let "Detroit go Bankrupt" let Toyota or Fiat come and buy it up and then him and the shareholders make off like a couple of corporate raiders (which is what is in his nature) and put the bill on paying the pensions and health care benefits on the public. Nothing wrong with that if you're heartless bottom line business man like Mr Romney is but we're talking more then just a business decision here Mr. Romney it's also about everyday people lives. You know the ones who love to shower after work not just before work!!!! So it's a really a non-question we know what he WOULD HAVE DONE!!! Now we're just going to see him backtrack as fast as he can or as nimbly as he can and it's not going to work.
Being a leader, also means being able to refrain from thinking like an industry knight with popping dollar signs in the place of the eyes. Romney’s instinctive reaction at that time was to choose the most profit-able option for investors, not for the workers and their families. Letting GM go bankrupt and selling the pieces to investors would have generated huge profits for Romney and his friends, but Detroit and its neighborhood would have been like New Orleans right after Katrina.
Again, if Romney was president at that time, he would have made the worse choice for the American people. It is repulsive to see him now wanting to claim credit for this President Obama’s amazing success.
Mitt, you can say whatever you want now: I remember. Spin it anyway you want. I will still remember and I will NEVER trust you. Not even with my DOG.
Specially with my dog.
Common Sense- 4 U
I hope you are not old enough to vote. Your solution for everytime YOU are wrong is to run away.
This is a very slanted question because, by and large, the automakers are the big bailout success story. Untold numbers of jobs were saved, not just at the auto plants, but in every auto-related business in the county.
But we only know that now, in hindsight.
So asking if Romney would have bailed out the autos is a trick question -- it's like asking "would you have done the obvious good plan that saved tens of thousands of jobs, or... NOT???"
There are only two allowed answers:
1) Yes (which means he's a bad Republican, in favor of spending public money on private businesses)
or 2) No (which means he's in favor of people losing their jobs and crippling American industry and innovation)
It's a question designed to discredit Romney, no matter what answer he picks. And the fun part is he doesn't need to actually answer the question himself -- we'll do that just fine on our own when we read the article! We supply both answers in our brain, just by reading the question!
The real problem is that it's a badly worded question. It doesn't help us figure out what Romney would do in the future at all.
Ol' Mittens is going to lose in his home state! LMAO! And his pops was the was the govenor of Michagain hahahahaa!!!!
Is this the way of "news" in this country now? As a swip hit piece obama shill msnbc is going to SPECULATE on what a politician MIGHT have done on a given subject. Hey why not a piece on what Gingrich might have done at the alamo, or What Santorum may have done at Lexington, maybe what Rommney would have done at San Juan hill??? Hey I can guess what obama would have done in Bushes place - in front of an elementry school class being told of the 911 attacks for the first time ... poop his pants!
Looks to me like the gist of the article is Mittens saying what he would have done or might have done or might not have done and the story changes by the minute as is typical of your hero Mittens and the rest of the clowns in your GOP three ring circus.
Bottom line: Obama saved Detroit along with hundreds and thousands of businesses in the supply chains, PLUS the mom&pop businesses surrounding the factories who depends on the patronage of the autoworkers. GOP = anything but Obama's. My guess is, the GOP is dead in Detroit for 2012.
bottom line - obama saved fat UAW PENSIONS. By not curtailing the union from strangling GM and giving the uaw 58% controling interest in GM - the tax payers will be called on to bail them out AGAIN in a few years. My guess - obama get re-elected - the countrys dead
pc, the UAW does not have 58% of GM. just because you keep typing it, doesn't make it true
Mittens reminds me of the guy standing by the road being interviewed while people are working to save the victims of a carcrash. Yep, I called 911. If it hadn't been for me they would all be dead. What a nerd.
sam, actually it's more like Mitt said "let them die". then, when Obama called 911 and saved their lives, Mitt says "that was my idea!"
This article confuses a very obvious result. Romney made it clear that he oppsed what Obama did, and now he is paying dearly for it. Romney would never have moved forward with subsidizing any industry in the United States, and his record proves that.
Romney tears down companies; he doesn't build them up
Cows may come and cows may go, but there is a lot of bull coming off Mitt's lips. You know what? Floridian Republican voters are just plain stoopid for voting for Romney.
NOTHING , WITHOUT SOMETHING GOING IN HIS PORTFOLIO '' AS THE PAD LOCKS BEGAN TO SOUND OFF AROUND THE PREMISES ; romney , and the republican conservative tea partiers aren't worried about nobody, ''but their lavish lifestyles'' YA'LL CAN TAKE THAT TO THE BANK
We have to realize that Rombo knows how to wash dog poo off his car, plus he also knows, but won't admit he's full of poo.
I never railed on Romney for the flip flopping because most politicians do it. The comments about the automotive bailout was one of the worse flip flopping events ever seen. He flat out said the government should not have bailed out GM and Chrysler. He went as far to say these companies would fail.
Now he is trying to talk like it is a great thing to see the companies succeeding. A couple years back he said let them fail and could have cared less!
I don't know how he can walk around in Michigan and try to justify those statements. SMH!
Willard "Ebeneezer Scrooge" Romney wanted the auto companies to die with sprigs of holly through their hearts.
One of the most daunting thoughts on the GOP is that with a massive stream of revenue and all of their PR; the only people they could find to represent them are a tired old man named after a lizard and a vulture capitalist named Mittens. They should be embarrassed that they complain publicly about their own candidates.
In the old days a farmer had to shoot his horse when it went lame. How long should we let this descheveled party suffer before we put it out of its misery.