Associated Press
It was just a few years ago that policymakers, with the American auto industry on the brink of collapse, had a decision to make. President Obama launched an ambitious rescue, and immediately, Mitt Romney said we could "kiss the American automotive industry goodbye" if the administration's policy was implemented.
Indeed, at the time, Romney called the White House plan "tragic" and "a very sad circumstance for this country." He wrote an April 2009 piece in which he said Obama's plan "would make GM the living dead."
Oops.
At a time when housing starts are sputtering and there are few other solid signs of a recovering economy the U.S. auto industry has become the little engine that could.
Once all the makers weigh in with their August numbers by day's end sales for the month will likely show about a 16 percent year-over-year gain. And while the market, at best, is expected to total 14.5 million this year, well off from its 17-million peak, "There's not much else we can point to these days that's anywhere near as buoyant," said analyst Joe Phillippi, of AutoTrends Consulting.
The Associated Press found Detroit car companies "all reported double-digit increases in sales for the month compared with the same period a year ago."
Under the circumstances, and given the timing of the news, it's hard to miss the political implications.
Remember, when Obama launched his rescue policy, it was a real gamble, and Republicans were absolutely certain the plan was hopeless. It was a foregone conclusion, they said, since government intervention in the marketplace is always a disaster. Their ideology told them everything they needed to know -- every aspect of conservative governance told GOP policymakers the success of Obama's rescue would fail.
Consider the predictions made at the time, as pulled together by ThinkProgress.
Rep. John Boehner (R-OH): "Does anyone really believe that politicians and bureaucrats in Washington can successfully steer a multi-national corporation to economic viability?" [6/1/09]
Sen. Richard Shelby (R-AL): "It's basically going to be a government-owned, government-run company.... It's the road toward socialism." [5/29/09]
RNC Chairman Michael Steele: "No matter how much the President spins GM's bankruptcy as good for the economy, it is nothing more than another government grab of a private company and another handout to the union cronies who helped bankroll his presidential campaign." [6/1/2009]
Sen. Jim DeMint (R-SC): "Now the government has forced taxpayers to buy these failing companies without any plausible plan for profitability. Does anyone think the same government that plans to double the national debt in five years will turn GM around in the same time?" [6/2/09]
Rep. Tom Price (R-GA): "Unfortunately, this is just another sad chapter in President Obama's eager campaign to interject his administration in the private sector's business dealings." [6/2/09]
Rep. Lamar Smith (R-TX): The auto company rescues "have been the leading edge of the Obama administration's war on capitalism." [7/22/09]
Rep. Trent Franks (R-AZ): When government gets involved in a company, "the disaster that follows is predictable." [7/22/09]
They were prepared to let the industry die, or in Romney's infamous words, "let Detroit go bankrupt." With the benefit of hindsight, we now know they were wrong and Obama was right.
I suspect we'll hear some gloating in Charlotte this week, and at least in this case, it'll be understandable.
Leave a Comment:
And this is why Obama should have some auto workers on the stage when he accepts the nomination.
Sure. Maybe they can explain why GM is headed for another bankruptcy.
http://www.forbes.com/sites/louiswoodhill/2012/08/15/general-motors-is-headed-for-bankruptcy-again/
Actually Rachel, Mitt was right, GM did declare bankruptcy, just like Mitt said, there is just one small difference between President Obama and Mitt. The President gave billions of dollars to GM before they declared bankruptcy. You use words like describing Mitt's opinion like " infamous", then forget to state the truth. The FACT is that GM did file bankruptcy. GM still owes the American Public over 50 Billion dollars. in the late 90's and early 2000's GM had just under 50% of market sales. Just this year they dropped from 20% of market sale down to 18%. Over the last 3 months their sale were up with a large boost coming from government buys.
So when you look at the facts, I would say all but one of those statements above are accurate.
Maddow the queen of half truths.
http://www.economist.com/node/16846494
"Government Motors no more" - Aug 19th 2010
Feb. 14th 2012
http://www.economist.com/blogs/democracyinamerica/2012/02/mitt-romney-and-car-industry
What they forgot to tell you is that they haven't paid off the taxpayers on the loan bailout. That's why our deficit is skyrocketing and we're going broke.
Sigh, Cindy!
GM doesn't "owe" the government a dime! The Treasury Dept converted its loan into equity shares and currently holds about 25% of GM's stock. To break even, the govt needs to hold onto those shares until GM's stock share price reaches $53. It would be STUPID for the Govt to sell those shares now when GM's stock price is down. Soooo.....if you want "your money" back, you'd better hope GM does well!!!
Shooter,
Since you are so fond of Forbes, here's another article for you:
http://www.forbes.com/sites/boblutz/2012/08/17/chicken-littles-second-gm-bankruptcy-the-gold-medal-for-silly-op-ed-pieces/
Ill see your Lutz and raise you a Bloomberg. Apparently GM is scrambling around for credit, even as it claims $32 billion of "cash on hand". Hmmmm.
http://www.businessweek.com/news/2012-08-24/gm-said-to-have-initial-talks-with-banks-to-expand-credit
And then there's the channel stuffing, claiming sales that haven't actually happened.
http://www.zerohedge.com/news/gm-finds-creative-new-ways-stuff-channels-get-backdoor-taxpayer-funding
Shooter, you should have read the article - actually it is positive for GM
and, I raise you a Seekingalpha and a Barrons:
http://seekingalpha.com/article/843381-general-motors-reorganization-will-the-glory-days-be-back
http://quotes.barrons.com/GM/research-ratings
See where says GM is rated as a "buy"?
and then there is this:
http://www.cbsnews.com/8301-18563_162-57506001/four-years-later-car-industry-rebounds-from-brink/
10% increase in sales isn't chump change!!
Actually I was surprised to see Seeking Alpha agree with the near bankruptcy. I have to say though, Mary Barra sounds like a real pistol. Global decision making is what got GM into trouble before, it will be interesting to see what happens from here.
But I thought Mitt spoke the magic words "MANAGED BANKRUPTCY' and made it all better. Thank God the Mitt Man was there to utter those inspiring words, otherwise no one would have thought a managed bankruptcy was even a possiblity. Mitt saved the auto industry and Bush killed Bin Laden. What a wonderful world they live in.
Alternate realities aren't just for video games.
Well, "alternate realities" are definitely where the trolls on this site live.
A more "bitter pill" was offered by Romney to the underwater homeowners. I am surprised that it has not gotten more play.
He said that the banks should foreclose, and then let investors buy the properties- and rent them out.
How does THAT feel, Mister and Mrs. America, and all the ships at sea?
AD:
Mitt Romney said....
We chose a different path...
Quote sales stats...
We in my administration would like to thank the American public on behalf of our auto industry for your confidence.
President closeup: The lesson is... Never bet against the American worker. I'm Barack Obama and I approved this message.
I'll let a real ad copy writer fill in the blanks.
Steve, you can use all the fancy citations and links you want, but none of that will change the fact that Obama did precisely what Mitt Romney told him to... thank goodness. Romney single-handedly saved the auto industry.
Oh, did I say "fact"? I meant "fantasy". No difference, though, Roget's lists the two words as synonyms.
OK, actually not. Roget has a liberal bias.
You're being as disingenuous as Mitt Romney.
Apology from "The Economist" (Who agreed with Romney at the time):
http://www.economist.com/node/16846494
"Government Motors no more" - Aug 19th 2010
AND they trashed Romney for being as disingenuous as you:
Feb. 14th 2012
http://www.economist.com/blogs/democracyinamerica/2012/02/mitt-romney-and-car-industry
I understand why Romney is lying The question is why are you?
Rollo- I think you need to adjust your sarcasm filter... if you re-read and substitute the word he uses in the second graph, David wrote "...but none of that will change the fantasy that Obama did precisely what Mitt Romney told him to."
You're right VVSad. Apologies to David. Given my constant use of sarcasm in my personal life, I should be better at recognizing it.
Rollo,
You need to post your great response to blanks and chemd up thread.
Good idea.
Rollo: you REALLY need your ironymeter recalibrated.
Look if Mitt had already taken over the auto companies with Bain then he would have accepted the government money-taken those funds to the Caymans and shut down the plants anyway.
The repugs are off on a different stream though. Read their platform and then either become a crusader for theocracy or vote for democrats.
In light of all the quotes from Republicans talking about the evils of government intervention, it's especially interesting to hear Ryan's latest spin on the Janesville plant. He now acknowedges the plant closed down before Obama took office, but it's still Obama's fault for leaving it shut down.
So now Ryan is claiming Obama should have micro-managed GM and told the company which plants should be closed and which should be allowed to operate? That's not a very conservative approach, is it?
All that Ryan was addressing were the broken promises of Obama. He made, to the people listening, a promise the plant woulds remain open with government help. Spin it as you will, but that's what the workers heard.
Who rescued the auto industry? WE the tax payers did it, and we did it for the good of the WHOLE country.
Who rescued the Salt Lake City Olympics? WE the tax payers did it, and we did it for the good of the WHOLE country.
Yes, we could do it and we did.
There you go reminding the Romney types that We the people dooed it. They resent that very much since they would prefer the working class were homeless while the wealthy go taxless.
RM, NASCAR...Charlotte Speedway...GOP new rollout, building on Tampa empty chair appearance..."A Hint of Clint"...the smell of gunfire...the scent of power...like Cialis on steroids...free samples of "Do Ya Feel Lucky?" if you know NASCAR owner or jetski. Fictional, just for fun only.
The president's campaign has struggled because they have failed to get a consistent message out to key voter groups. Obama has not made a single effective pitch so far in this race. The records speak for themselves, really. If voters of any class are not thrilled that Detroit has been saved, the auto industry is booming, the financial industry was saved from an apocalyptic meltdown, another depression was averted, 4.5 million new jobs have been created since the recession ended, and positive growth for the future is predicted, etc., they can always vote for Mitt Romney, king of Bain and master of the car elevator.. - principled progressive
Can someone please acknowledge that both Tarp and the auto bailout were both initiated under Bush. And, while we're into the blame game, recognize the housing bubble bursting was the result also of actions promoted by admins prior to Bush. And, recognize Barney Frank's role in keeping Fanny and Freddy alive. Bush wasn't perfect, and contributed a good deal to the deficits and debt, but, he's not solely to blame.
About jobs, Mitt has said in Tampa and else where that if elected he will create 12 million jobs. Where would 12 million jobs appear from? My opinion is he has the 12 million Hispanic worker in the country already on the way to the border. Mass deportations the day after he takes office.
Paul Ryan is now saying that he didn't blame the Janesville plant closing on Obama but instead was pointing out that Obama didn't keep his promise when he said that he would push for the retooling of plants like the Janesville plant.
This new squirming makes Ryan look even worse because what we see is Obama standing at that plant and saying that he will go to bat for the automobile industry, and that's exactly what he did.
What Paul Ryan actually did is illustrate how Obama DID fulfill his promise to the American automobile industry.
it was the right thing to save the industry here, no car company would be doing well if GM and Chrysler would have gone down. all the suppliers and auto support companies ( and jobs) were at risk, many of them are suppliers ot my industry too, people do not understand how far the supply chain goes, not just cars but all mobile and electronic equipment. Marchionne of FIAT, Chrylser, Ferarri, Alfa, Maseratti paid their loan back early and builds better cars than ever. Give GM time, it's all good.
A point and a question. 1) the GM bankruptcy was forced by one small group of bond holders, never identified, who bought those bonds simply to force the bankruptcy, as a means of negating GM's retirement plan.
2) for Senators Shelby and Boehner and Rep Franks: if Bush's plans to channel SS taxes into the stock market as a mutual 401k like trust had gone through,even without the market collapse, wouldn't Treasury already have had a larger stake in GM, Chrysler and every other traded corporation ?? The american public would have to nationalize everything just to invest those funds. Were we supposed to do that and leave control with the former owners?
Total BS The only people that made money on the deal were UAW workers. We the taxpayers own worthless stock i.e. it is worth less than half of our original investment. Meanwhile no union workers at GM lose their pension. How come you liberals are so bad with math?
Those GM workers still at work have been shifted to a 401k holding only GM stock (can we say enron?) everyone else was shoved off to Pension Guarantee with out contracted benefits. Everyone's traditional UAW pension is GONE.
Good thing we saved the auto industry when we did....Try Marchionne, FIAT, Chrysler, Ferrari, Alfa, Maseratti et all, he paid back their loan early and saved 10's of thousands of jobs and builds better cars! If GM and all failed? no one understands at the loss of support manufactureing (jobs and materials) my company and all my competition uses many of the same suppliers, we build billions in construction related equipment, 2008-2009 was bad enough, quite a bit better now I would say. big companies we deal with, John Deere, Cat etc. are getting huge profits and opening plants in the US. Ford is doing well, and GM is growing not only in the US but overseas, yes both in China too.
It may have been dominos to let them go as by saving 100's of thousand of realted jobs came consumers!
Been watching your show since day one and am glad your dog so well.
Have been wondering why no one on MSNBC is running any thing on the voter suppression going on in the south by the Tea party. The fact that their are Democrats in the southern states and few if any have a representative in the congress. This represents taxation without representation. That's up...!
After the cliff and on to March we go to spending cuts. The question in my mind has been why no one the right OR the left are talking about corporate welfare cuts. A 13 trillion GDP economy produces less than 10% return in taxes. All the pie charts show three sections of which two are self sustaining entitlement programs and defense. We need a new pie chart with tax welfare for corporations on it before we should even think about entitlements cuts. One pie chart FOUR huge sections and a sliver for discretionary spending and then we will have shared responsibility.