Obama Saves U.S. Auto Industry from the Party of Hoover
As the American auto industry teetered on the brink of collapse in December 2008, Vice President Dick Cheney beseeched his GOP allies in Congress to back an aid package, warning, "If we don't do this, we will be known as the party of Herbert Hoover forever." Which is exactly right. Because while Republican leaders were warning of the "bridge loan to nowhere" and the "road to socialism," President Obama was saving the American auto industry and with it hundreds of thousands of jobs.
As GM announced an initial public offering which could ultimately lead to American taxpayers being paid back in full for taking an ownership stake in the company, President Obama was certainly right ysterday to proclaim that the "doubters and naysayers" were proven wrong. With growing sales and improving profit forecasts at GM, Chrysler and Ford (which did not accept bailout money), Detroit has pulled back from the abyss. As the AP noted:
Obama said estimates indicate that actions by his administration helped save more than 1 million jobs across 50 states.
The Center for Automotive Research estimated that aid to GM and Chrysler saved more than 1.1 million jobs in 2009 and 314,000 jobs this year.
But had the laissez-faire jihadists of the GOP had their way, the devastating blow to the U.S. economy would have been a knock-out punch for the auto industry.
After blocking legislation in December 2008, the leading lights of the Republican Party blasted President Obama over the auto bailout the following spring While Senator Richard Shelby branded the administration's lifeline "the road to socialism," Arizona Rep. Trent Franks proclaimed "the disaster that follows is predictable." Speaker-to-Be John Boehner grumbled, "Does anyone really believe that politicians and bureaucrats in Washington can successfully steer a multi-national corporation to economic viability?" And while Texan Lamar Smith called the GM and Chrysler rescues "the leading edge of the Obama administration's war on capitalism," RNC chairman Michael Steele said it was all a political favor for Democratic constituencies:
"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."
And despite warning that the collapse of GM alone could cost the federal government up to $200 billion in unemployment insurance and other programs, once-and-future Republican White House hopeful Mitt Romney declared, "Let Detroit Go Bankrupt." Then again, the son of American Motors magnate George Romney warned Michigan primary voters in January 2008 that he didn't want to raise "false hopes that somehow we can bring back lost jobs."
Luckily for the American economy, President Obama persevered. But in a sad irony, voters in Michigan, Ohio and Indiana punished his party nevertheless. As Timothy Egan explained in "How Obama Saved Capitalism and Lost the Midterms":
Saving the American auto industry, which has been a huge drag on Obama's political capital, is a monumental achievement that few appreciate, unless you live in Michigan. After getting their taxpayer lifeline from Obama, both General Motors and Chrysler are now making money by making cars. New plants are even scheduled to open. More than 1 million jobs would have disappeared had the domestic auto sector been liquidated.
It's no wonder The Economist, which opposed the $86 billion auto bailout, admitted "an apology is due Barack Obama."
As for the Party of Hoover, don't expect any apologies any time soon.