”If General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye.”READ MORE: Barrett Scores 28 As Knicks Beat Clippers 110-102
That was the lead of Mitt Romney’s op-ed entitled “Let Detroit Go Bankrupt”.
It has been one of the costliest political statements he has made. It made it impossible for him to contest in Michigan, the state his dad was governor of. It has cost him in Ohio, a state whose economy is better than the national average because of their ties to the auto industry.
Auto manufacturing is back in America – especially in Michigan, Ohio and Pennsylvania because President Obama made the politically risky decision to bailout the auto industry after bailing out the banks.
It was a decision that worked. Obama was right, Romney was wrong.
So Romney is now in full lying mode. He is trying to retroactively re-write the wrongs in his writings.
He now claims that the president did what Romney suggested. But the record exposes Romney’s falsehoods.
Romney never would have secured the financing necessary for the auto industry.
On November 20, 2008, the same day he published the article in question, Romney also did a media tour. That morning he told CBS “there’s no question but that if you just write a check that you’re going to see these companies go out of business ultimately.”
He also told NBC: “If you write a check, they’re going to go out of business. If instead you help them restructure, you make them cost-competitive with the Japanese, they can stay in business virtually forever. And so this is a time, an opportunity for us, to help these companies shed their excess costs so they can stay in business.”
Ultimately, Mitt Romney was wrong on two major fronts.
First of all, that the tax payers would lose money and the auto companies would shut down if the federal government wrote the check.
Second, that private financing was available at the time. It was not.
Bob Lutz, a Republican who was the vice chairman of GM at the time of the bailout, told the Detroit Free Press about financing: “The banks were even more broke than we were. Who had the money? Loan guarantees don’t do any good if the banks don’t have any money.”READ MORE: Thousands In La Verne Remain Without Power Following Powerful Wind Storm
Dan Akerson, CEO and chairman of General Motors, said that Under Romney’s plan that GM “would have been in bankruptcy for years and I think you could have written off this company, this industry and this country.”
At the time of the bailout, Steve Rattner who was in charge of government task force for the auto bailout said in his own New York Times op-ed in February of this year addressed this issue and said the following:
“As a presidential aspirant, Mr. Romney evidently hasn’t felt a need to be consistent or specific as to what should have been done to address the collapse of the auto industry starting in late 2008. But the gist is that the government should have stayed on the sidelines and allowed the companies to go through what he calls “managed bankruptcies,” financed by private capital.
“That sounds like a wonderfully sensible approach — except that it’s utter fantasy. In late 2008 and early 2009, when G.M. and Chrysler had exhausted their liquidity, every scrap of private capital had fled to the sidelines.
“I know this because the administration’s auto task force, for which I was the lead adviser, spoke diligently to all conceivable providers of funds, and not one had the slightest interest in financing those companies on any terms. If Mr. Romney disagrees, he should come forward with specific names of willing investors in place of empty rhetoric. I predict that he won’t be able to, because there aren’t any.
“Without government financing — initiated by President George W. Bush in December 2008 — the two companies would not have been able to pursue Chapter 11 reorganization. Instead they would have been forced to cease production, close their doors and lay off virtually all workers once their coffers ran dry.
Romney was wrong in 2008 and he is wrong now. Worse, he is lying about what he said and he is lying about the auto industry in a bigger way today.
Romney made a false claim based on a wrong blog post in the right wing rag The Examiner that jobs are leaving Toledo’s Jeep plant. It is based on an article that was written in contradiction of a Bloomberg article.
Those are Mitt Romney’s standards.
Even though Chrysler beat back the story with a statement that read in part, “let’s set the record straight: Jeep has no intention of shifting production of its Jeep models out of North America to China. It’s simply reviewing the opportunities to return Jeep output to China for the world’s largest auto market. U.S. Jeep assembly lines will continue to stay in operation. A careful and unbiased reading of the Bloomberg take would have saved unnecessary fantasies and extravagant comments.”
But the Romney campaign turned this lie based on the writings of a crack pot publication into an ad.
About Bill Buck
Bill Buck is a Democratic strategist, President of the Buck Communications Group, a media relations and new media strategies consulting business based in Washington, DC, and Managing Director of the online ad firm Influence DSP. He has over twenty years of international and national communications experience. The views and opinions expressed in this post are those of the author and do not necessarily reflect the official policy or position of CBS Local.MORE NEWS: LA County Sees Drop In COVID-19 Hospitalizations, But Transmission Rate Remains High