As the Republican presidential nominating contest moves to Michigan, former Massachusetts Gov. Mitt Romney (R) is touting his ties to the state — he was born there and his father is a former governor — and its auto industry. Romney wrote an editorial early this week re-upping his opposition to the 2009 auto rescue that saved Chrysler and General Motors, a sequel to the editorial outlining his original opposition, titled “Let Detroit Go Bankrupt.”
The response to the editorial probably hasn’t gone as Romney hoped. Since it ran in the Detroit News Tuesday, auto industry insiders have repeatedly slammed it as “reckless,” “dishonest,” and “wrong,” noting that Romney either mistakes or ignores some of the basic facts surrounding the rescue. ThinkProgress compiled a sample of the reactions to Romney’s latest view of the rescue:
AutoNation CEO Mike Jackson: As far as Mitt piece in yesterday’s Detroit News it was truly reckless, detached from reality, and dishonest. … Mitt’s assertion that private financing “DIP” was available in fall of ’08 into ’09 is fantasy. Everyone knows we were in the midst of the greatest financial meltdown since the 1930’s. … The catastrophe in ’08 was so calamitous that government actions were necessary to avoid a great depression. Sometimes reality trumps principle and a courageous leader will understand that and will take the leap even when it is dramatically unpopular.
Yahoo! Autos reporter Justin Hyde: “Romney’s take just doesn’t square with the facts as I lived them. … Had the government not intervened as Romney suggests, GM and Chrysler likely would have been liquidated by their Wall Street bondholders. … One auto industry think tank estimated doing so would have led to 1.3 million job losses and threatened Ford, Toyota and other automakers.”
Reuters columnist Paul Ingrassia: “The government bailout was the only way to save GM and Chrysler, and thus was a critical element in preventing the Great Recession from morphing into Great Depression II. … The only alternative to a government bailout was the outright liquidation of both companies. Maybe the U.S. economy could have survived that blow, but maybe not. What’s clear is that it would have been foolhardy to find out.”
The Economist: “The course Mr Romney recommended in 2008 began with the government stepping back, and it is unlikely things would’ve turned out so well had this happened. … The credit markets were bone-dry, making the privately financed bankruptcy that Mr Romney favoured improbable. He conveniently ignores this bit of history in claiming to have been right all along.”
Romney’s view of the bailout isn’t even popular among his best friends in Michigan. Gov. Rick Snyder (R), who endorsed Romney yesterday, chastised Republicans who continue to criticize the bailout last November. “I would have had some differences on how they did it, but I’m not going to second-guess it,” Snyder told the New York Times. “The more important thing is the results. And the auto industry is doing very well today.”