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YOLO COUNTY NEWS
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Auto bailout all but forgotten

By
From page A10 | December 13, 2013 | 4 Comments

The issue: Turnaround of U.S. automakers is true recovery

When President Obama orchestrated the multibillion-dollar bailout of the U.S. auto industry in 2009 — GM and Chrysler were headed into bankruptcy, Ford was struggling — his many critics derided it as either a nefarious socialist plot or an attempt to buy the votes of autoworkers about to lose their jobs.

IN ANY EVENT, the government made out like a capitalist when it began to sell its ownership shares in GM and Chrysler and Obama did indeed win, with the exception of Indiana, the industrial belt. That included Michigan, the home state of Mitt Romney, who despite being the scion of an auto company president, favored letting GM and Chrysler go bankrupt.

USA Today, in its dissection of the 2012 presidential election, said, “In the end, there is no overestimating how large of a role that the auto industry bailout played in President Obama’s re-election.”

And, also in 2012, CNNMoney said of the bailout, “The U.S. auto industry’s recovery is one of the biggest success stories of the last four years.”

The Michigan-based Center for Automotive Research believes the massive infusion of taxpayer funds — as much as $60 million on the two companies alone — saved 1.5 million jobs and stopped a wave of bankruptcies from sweeping through the industry’s suppliers.

THE AMERICAN auto industry was caught in a triple whammy — a global economic downturn; a mix of products that ran heavily to high-fuel-consumption pickups and SUVs just as gas prices began to soar; and crippling legacy costs from previous union contracts that gave foreign makes, even those produced in the United States, a cost advantage of $350 to $500 a vehicle.

Thanks in no small part to that bailout and the economic recovery, November auto sales were 9 percent above a year ago with sales running at an annual pace of 16.4 million vehicles for the year, the strongest since February, 2007.

It is perhaps worth noting that major news outlets reporting the robust auto industry figures — The New York Times, The Wall Street Journal, Financial Times, the Associated Press — made no mention of Obama or, for that matter, socialism.

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Discussion | 4 comments

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  • December 13, 2013 - 3:30 pm

    Amazing how your editorial leaves out the fact that the auto bailout cost ended up being $15 billion lost American taxpayer's money. The unions reaped the biggest rewards at the bond holders were royally screwed. Yes Romney said the auto companies should go through bankruptcy, but that didn't mean they'd go out of business. Instead of the taxpayer bailing out the auto industry the courts would've guided them back into solvency without the taxpayer losing $15 billion. United, Delta, Continantal and many other airlines went through bankruptcy and they're thriving today. Let's be a little more fair with the editorials and quit sucking up to Obama.

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  • Greg JohnsonDecember 13, 2013 - 5:47 pm

    Exactly my thoughts. Interesting how the government "made out like a capitalist", isn't it. I don't think capitalists invest to lose 15 billion dollars. The only capital gained was the political capital Obama gained by deceiving naive voters that he "saved Detroit".

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  • ontDecember 15, 2013 - 7:36 pm

    Never a day off for the Obama haters. If he was a pediatric surgeon who excised some deadly cancer from a patient and saved his life, Fox News and the Republican party, followed by their blind followers throughout the land, would be screaming in synchronized outrage about how Obama scarred the kid for life with the incision. Meanwhile, the “liberal media” would dutifully hype the “controversy.”

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  • ontDecember 15, 2013 - 7:44 pm

    It's an easy job being a republican politician when all you care about is tearing down your opponent and stirring up the hatred of your voters. You can hardly lose using a constant barrage of dishonest, negative ranting because the press is unlikely to hold you accountable. The GOP’s playbook is always stay on the attack, always be negative, and try to cultivate resentment at every turn. It helps make voters more cynical about government and depress voter turnout too. Feel an impulse to acknowledge a positive development in the country? Better stifle it then if the president could get some credit. When the president takes bold action and succeeds in saving the US auto industry when private financing was non-existent, do you at least grudgingly admit things worked out pretty well after all? Heck no. You call it the end of freedom, motivated by Obama’s desire to run all private industry and to spend spend spend and don’t forget to drone on about the greedy unions. The beauty of the damned if you do or don’t GOP approach is if their advice was followed and the government sat on the sidelines while the US auto industry disappeared, they would then just scream about the demise of an anchor of the US economy under the democrats and further rail about how the appeaser-in-chief recklessly endangered our national security by allowing the loss of these manufacturers on his watch, thereby handing a huge win to China, Russia, and “the terrorists.”

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