Obama attacks Romney over auto bailout stance

WASHINGTON Tue Feb 28, 2012 5:22pm EST

President Obama is greeted as he arrives to deliver remarks at the United Auto Workers conference in Washington, February 28, 2012.   REUTERS/Kevin Lamarque

President Obama is greeted as he arrives to deliver remarks at the United Auto Workers conference in Washington, February 28, 2012.

Credit: Reuters/Kevin Lamarque

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WASHINGTON (Reuters) - President Barack Obama attacked White House contender Mitt Romney on Tuesday over his opposition to the 2009 bailout of the auto industry, seizing on a vulnerability for the Republican candidate on a crucial voting day.

Speaking to auto union workers in Washington on the same day Romney faces a potentially pivotal primary vote in Michigan, home to General Motors and Chrysler, Obama trumpeted his rescue of the two major auto companies and accused Romney of wanting to abandon American workers.

Though he did not mention the former Massachusetts governor by name, Obama cited the title of a 2008 opinion piece Romney wrote called "Let Detroit Go Bankrupt" in which the Republican argued against a government-funded bailout.

Obama said if he had followed that approach, the workers who built the companies would have been "hung out to dry."

He also referred to comments Romney made on Fox News Sunday this week in which said he favored a "managed bankruptcy" and criticized the amount of money that went to the United Auto Workers in the Obama administration's intervention.

"You've got folks saying. `Well, the real problem is, what we really disagreed with was the workers, they all made out like bandits; that saving the American auto industry was just about paying back unions,"' he added. "Really? Even by the standards of this town, that's a load of you-know-what."

Romney's 2008 opinion piece is a potential albatross for him in Michigan, where he was born and raised. Romney's father was a popular governor there and before that ran an auto company.

Michigan, which along with Arizona holds a Republican primary on Tuesday, is seen as an important test for Romney, who is running neck-and-neck in the state with former Pennsylvania Senator Rick Santorum.

Although Santorum also opposed the auto bailout, Romney may be more vulnerable on the issue. Santorum, who has stressed his roots as the grandson of a coal miner, has had success courting blue collar voters in the state. Romney, a wealthy former private equity executive, has struggled with those voters.

BLUE-COLLAR VOTERS

Playing to an enthusiastic crowd at the United Auto Workers convention, Obama emphasized populist themes that his campaign hopes will resonate with middle-class workers in states likely to become battlegrounds in the general election.

"Don't forget I got my start standing with working folks who'd lost jobs and hope when nearby steel plants closed down, because I didn't like the idea that they didn't have anybody to fight for them," Obama said, reminding the workers of his background as a community organizer.

The 1,700 workers and other supporters gave Obama several standing ovations and chanted "Four more years!"

Since the $80 billion U.S. bailout of the auto industry, Detroit's big automakers have moved from crisis to renewed profit. In 2009, GM and Chrysler were put through government-funded bankruptcies that slashed costs and debt.

GM, which returned to the stock market as a traded company in 2010, posted a 2011 profit of $7.6 billion. Its share price $26.37 is below its $33 initial public offering price of November 2010. The U.S. Treasury still owns about a quarter of the top U.S. automaker.

Chrysler came out of its bailout managed by Italy's Fiat SpA, which last year took majority ownership. In 2011, Chrysler reported a full-year net income of $183 million and forecast $1.5 billion in profit in 2012.

Proponents of the bailout say it saved GM and Chrysler from liquidation and avoided a chain of bankruptcies in the auto supply sector that could have cost hundreds of thousands of jobs.

Ford avoided bankruptcy by borrowing heavily in 2006 before the credit markets froze. It was helped in its turnaround by low-interest loans from the Department of Energy.

Whether Romney or Santorum is the nominee, the Obama campaign is increasingly confident of its support in Michigan, in part because of the auto bailout issue.

But Obama's advisers hope that the message about fighting for the working class will also play well in other Midwestern states with large numbers of blue-collar workers such as Ohio and Pennsylvania.

(Additional reporting by Alister Bull, Samson Reiny and John Crawley in Washington and Bernie Woodall in Detroit; Editing by Vicki Allen and Cynthia Osterman)

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Comments (3)
matthewslyman wrote:
If people knew what bankruptcy was about, they wouldn’t have a problem with it. Bankruptcy would have meant ACCOUNTABILITY for failed executives. It would have meant them being barred from being company directors again, for quite some time.

INSTEAD, Bush II and Obama bailed out the banking & auto executives (who have been paid handsome bonuses for their fraud & failure), postponed the inevitable day of reckoning, and prevented the healing process that could have fixed the system much quicker.

This is not Romney’s weakness, but his strong point. He knows what he’s talking about, when it comes to bankruptcies, investment, negotiations, contracts, market saturation and market efficiency. Romney’s father was extremely successful in looking after the interests of automotive industry and workers alike. Obama can repeat this lie all he wants, but no intelligent Americans should believe it: Romney’s on his home turf in this department.

Feb 28, 2012 4:49pm EST  --  Report as abuse
croc8 wrote:
Amazing how utterly SELFISH are many Americans, they claim to be religious conservatives but they don’t give a damn about their fellowmen. At least Obama did do something for US jobs. The Republicans are made of self righteous bigoted rich men

Feb 29, 2012 12:20am EST  --  Report as abuse
TobyONottoby wrote:
This so-called bailout was, in fact, a managed bankruptcy in which the governments of both the United States and Canada bought GM and Chrysler at a low price, guided the companies’ restructuring and return to profitability, and have now put the companies back on the market to recoup the investment. As an added benefit, both governments avoided the cost of paying unemployment compensation to an army of workers who would’ve lost their jobs had Mr Romney’s advice been followed.

Even former President G. W. Bush and current Conservative Prime Minister Steven Harper know more about the distinctions between government and business than any of the current presidential candidates seeking the GOP nomination. The Republican Party has suffered so many misguided makeovers that it is now unrecognizable in comparison to its former self. Since the relatively responsible and constructive era of Eisenhower, they’ve ventured into a populist nihilism, such that Hank Williams Jr and Ted Nugent now stand tall among its principal substitutes for its missing philosophers. This isn’t a political party. It’s an apocalyptic biker gang.

Feb 29, 2012 9:40am EST  --  Report as abuse
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