Fact Check: Artful swerves on auto bailout
President Obama shakes hands with Ford President and CEO Alan Mulally after announcing new fuel efficiency standards to curb auto emissions for US cars alongside leaders of worldwide automakers and members of his Cabinet in the Rose Garden of the White House in Washington on May 19, 2009. / Getty
WASHINGTON - Michigan has become squirm central for Republican presidential candidates who are trying to explain their opposition to the auto bailout before the big primary in the home of automakers. Their tale is terribly tangled, and President Obama isn't telling it straight either.
Obama, in taking credit, and Republicans, in assigning blame, have ignored one driving force behind the love-it-or-hate-it bailout: George W. Bush in the waning days of his presidency. Moreover, GOP rivals Mitt Romney and Rick Santorum would have people believe the United Auto Workers union runs General Motors and the government "gave" it away, neither true.
The issue is a particularly nettlesome one for Romney, Detroit-born son of a Michigan governor and auto company chief executive. His provocatively headlined 2008 article, "Let Detroit Go Bankrupt," has made for tortured explanations in the campaign for the Feb. 28 primary - though the prescription he preached back then is not wholly at odds with what the government finally did.
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Then again, Romney is hardly out on a Republican limb. Santorum opposes the bailout on similar grounds. As for the other candidates, Newt Gingrich raised the wild idea that Washington might force people to buy GM cars, and Ron Paul believes the market should let companies rise or fall without the government's intervention.
A look at some of the persistent claims about the bailout and how they compare with the facts:
ROMNEY: "If General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won't go overnight, but its demise will be virtually guaranteed." - Nov. 18, 2008, New York Times op-ed article.
SANTORUM: "If they'd have gone through the orderly bankruptcy process, gone through a structured bankruptcy, they'd have come out in the same place, only we would have kept the integrity of the bankruptcy process without the government putting its fingers into it." - June 13 New Hampshire debate.
THE FACTS: No one can know what would have happened absent the bailout. But it's a distinctly minority view that the private sector, raked then by the financial crisis, would have nursed Detroit back to health without a massive infusion of federal aid. In late 2008, banks weren't making many loans, much less to companies that were out of cash. The Bush administration moved fast because it saw no time to let an orderly bankruptcy unfold, even if banks had the money and the will to steer automakers through the process.
Romney's grim prognosis, before GM and Chrysler took the aid, is in stark contrast with the turnaround that followed. Last week GM reported a record profit for 2011, two years after the company's near-collapse, and said 47,500 union workers will get $7,000 profit-sharing checks, the most ever.
Despite the bold headline - now making headlines of its own - Romney laid out some nuanced ideas, including substantial federal aid.
He called for the government to guarantee post-bankruptcy financing and to back up warranties so people would not be afraid to buy cars from the fragile companies. And he proposed a fivefold increase in federal research spending on energy.
OBAMA: "On the day I took office, our auto industry was on the verge of collapse. Some even said we should let it die. With a million jobs at stake, I refused to let that happen. In exchange for help, we demanded responsibility. We got workers and automakers to settle their differences. We got the industry to retool and restructure. Today, General Motors is back on top as the world's No. 1 automaker. Chrysler has grown faster in the U.S. than any major car company. Ford is investing billions in U.S. plants and factories. And together, the entire industry added nearly 160,000 jobs. We bet on American workers. We bet on American ingenuity. And tonight, the American auto industry is back." - Jan. 24 State of the Union speech.
THE FACTS: Lost in Obama's victory lap was the fact that Bush passed him the baton.
Pushing against a reluctant Congress, Bush steered $17.4 billion in emergency loans to GM and Chrysler in his final weeks in office, on condition they shrink debt, negotiate wage and benefit cuts with workers and submit plans to achieve "long-term viability, international competitiveness and energy efficiency."
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What'd ya do this time? LOL
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Mortarman291SG: "Occupy, your post here bares little resemblance to facts."
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The U.S. economy has seen improvement across the board since October. The best progress has been in jobs, where there has been steady progress. In January, there 243,000 new jobs and the unemployment rate dropped to 8.3 percent, the lowest it's been since February 2009. There has also been improvement in manufacturing and even in the beleaguered housing market there are some tiny glimmers of activity.
Come back mortar, when you can admit to something besides your right-wing "gloom and doom" prognostications!
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You hear that Mortar? LMAO!!! : )
Please tell us exactly how that adds to the discussion, and is not an off-topic, juvenile personal attack?
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Mortarman291SG: "Occupy, your post here bares little resemblance to facts."
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Hey -- show us what is not factual........we're waiting.......
BTW, how do you think the DJIA performance during bushworld treated average Americans invested in 401(k)'s, when it dropped 26% over the 8 years?
Still waiting..............
Yes, there has been a ripple effect from the auto bailout, and increased job creation in the manufacturing sector -- something we haven't seen since 1997........GOOD NEWS!
But, just like you said, the financial sector bailout only helped the fat cats, since the housing market, construction industry, realtors etc...are still hurting badly, and many that didn't deserve to lose their homes, did, through no fault of their own except loss of a job.
Well, first and foremost, kill 'Citizens United' with legislation taking the MONEY out of POLITICS, since these billionaires should have no more 'power' than the rest of us in America, since it is only corrupting our entire system today!
Remember: "Power Corrupts, Absolute Power Corrupts Absolutely."
Nah, it's YOU that is the biggest hypocritical STALKER here, and anyone can clearly see all your juvenile, off-topic personal attacks below each and every one of my posts today!
Your arrogance overwhelms your highly-opinionated right-wing posts!
Of course you do, and what do they give you for too much agent orange still in your system, causing that excessive anger management problem?
"Pushing against a reluctant Congress, Bush steered $17.4 billion in emergency loans to GM and Chrysler in his final weeks in office, on condition they shrink debt, negotiate wage and benefit cuts with workers and submit plans to achieve "long-term viability, international competitiveness and energy efficiency."
Give me a break. Is CBS so overly concerned about "Bias" that CBS must bend oved backwards to be "fair and balanced." The responsible government act was taken. So President Bush wanted to do the right thing and President Obama did what needed to be done and the reactionary Oh-so-evermore far right missed the boat entirely. Maybe you think President Obama should be held to a "higher standard" and treat the TGOP side show as having a good point.
Poorly conceived article. If you really want to be critical of the President, the Congress, or whoever, you might look at the bank "Bailout" without strings to require the banks to do the "right thing and actually engage in Commercial Banking instead of speculation. If the banks had done their job in the first place government intervention would not have been so essential.
Suck it up "occupy" -- I had a "Nancy" that told me she's like to see me Hang - I'm a Christian and "Slow" and "fish" are always trashing my faith - "enza" tell me she would spit in my face for simply being a combat veteran - Hell, I even have a TS "Meboard" that's say's I'm in "Command of silly monkeys" I could go on and on ...
Ms Zann -- "occupy" needs to chill before he blows a freaking Head Gasket!
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Seems that if ANYONE is blowing a gasket, it's YOU, and just like a juvenile that lost the argument, is blaming others for your own actions against me!
YOU need to take personal responsibility for once in your life, stop blaming others, and start posting without the personal attacks that get you banned!
Sergeant major, by his own standards, Occupy is stalking you!
Will you be reporting him to CBS??
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Hey I gotta go to lunch - Y'all TRY not to kick each other off while I'm gone! : )