What Do Republicans Have Against Detroit?
The saga of Detroit’s Big Two and a Half automakers over the past decade has been a riches to rags to riches story that Republicans, as has so often been the case, are finding reason to criticize and not celebrate although it is a rare bright spot amidst economic gloom.
Long story short, General Motors, Ford and Chrysler were running on fumes at the start of the new millennium, making lots of money from manufacturing boring, fuel inefficient and uncompetitive cars. Reality in the form of rising fuel costs and Japanese, German and Korean automakers who grabbed the competitive edge eventually caught up to them, and by 2008 the once proud troika was on its knees.
Enter a necessary evil in the form of a taxpayer-funded bailout of GM and Chrysler. (Ford, while on the ropes, believed it could survive without Washington’s direct help.) Like many people, I struggled with the question of whether the automakers should be allowed to die of their own self-inflicted wounds, but eventually came around to the view that far too many jobs were at stake to allow that to happen.
The two-step $80 billion bailout, which was intended to allow the automakers to retool their factory to produce more fuel-efficient vehicles, began at the end of George Bush’s second term and culminated during the first year of Barack Obama’s presidency. It was supported by most Democrats and opposed by most Republicans, including an especially patriotic bloc of senators from Southern states where Japanese and Korean automakers have assembly plants.
Fast forward two years: Bankruptcy is a memory, the Treasury will have been repaid all but $14 billion of bailout monies well ahead of schedule, all three automakers are turning profits for the first time since 2004, all three are ramping up production and all three are hiring.
This, however, has not assuaged Republicans, whose message is that the Obama administration is too damned friend to unions — in this case the very unions that agreed to major concessions as part of the bailout and were major players in the automakers’ recovery.
Obama touted the recovery during a tour last week of a Chrysler-Fiat assembly plant in Toledo that makes Jeep Wranglers, which prompted House Majority Leader John Boehner of Ohio to harrumph that the bailout and the industry’s revival is “nothing to celebrate.”
Boehner said that Obama should be using Ford as a model since it turned down bailout money. What he conveniently failed to note was that Ford supported the bailouts because had GM and Chrysler died, so would many of the suppliers that it relies on. Ford did lay off 49,000 workers to stay afloat, and those workers cost taxpayers nearly $600 million in unemployment compensation.
Then there is Mitt Romney, who probably is the only Republican presidential wannabe who has even a slim chance of beating Obama in 2012. Despite being from Michigan, he opposed the bailout and will have a lot of explaining — or more likely flip-flopping — to do when he visits Michigan and other states were automaker is a major part of the economy.
This Detroit bashing begs a question: Why is the GOP insistent on opposing the stuff that the Obama administration gets right and of which most voters approve?
It’s a combination of spending too much time in its own echo chamber, being out of touch with Main Street while beholden to Wall Street, being against anything and everything that doesn’t screw poor people and women, and having to contend with a president who is more popular than his policies.