Auto industry rescue continues to pay off

Updated
 
Auto industry rescue continues to pay off
Auto industry rescue continues to pay off
Associated Press

It was just a few years ago that policymakers, with the American auto industry on the brink of collapse, had a decision to make. President Obama launched an ambitious rescue, and immediately, Mitt Romney said we could “kiss the American automotive industry goodbye” if the administration’s policy was implemented.

Indeed, at the time, Romney called the White House plan “tragic” and “a very sad circumstance for this country.” He wrote an April 2009 piece in which he said Obama’s plan “would make GM the living dead.”

Oops.

At a time when housing starts are sputtering and there are few other solid signs of a recovering economy the U.S. auto industry has become the little engine that could.

Once all the makers weigh in with their August numbers by day’s end sales for the month will likely show about a 16 percent year-over-year gain. And while the market, at best, is expected to total 14.5 million this year, well off from its 17-million peak, “There’s not much else we can point to these days that’s anywhere near as buoyant,” said analyst Joe Phillippi, of AutoTrends Consulting.

The Associated Press found Detroit car companies “all reported double-digit increases in sales for the month compared with the same period a year ago.”

Under the circumstances, and given the timing of the news, it’s hard to miss the political implications.

Remember, when Obama launched his rescue policy, it was a real gamble, and Republicans were absolutely certain the plan was hopeless. It was a foregone conclusion, they said, since government intervention in the marketplace is always a disaster. Their ideology told them everything they needed to know – every aspect of conservative governance told GOP policymakers the success of Obama’s rescue would fail.

Consider the predictions made at the time, as pulled together by ThinkProgress.

Rep. John Boehner (R-OH): “Does anyone really believe that politicians and bureaucrats in Washington can successfully steer a multi-national corporation to economic viability?” [6/1/09]

Sen. Richard Shelby (R-AL): “It’s basically going to be a government-owned, government-run company…. It’s the road toward socialism.” [5/29/09]

RNC Chairman Michael Steele: “No matter how much the President spins GM’s bankruptcy as good for the economy, it is nothing more than another government grab of a private company and another handout to the union cronies who helped bankroll his presidential campaign.” [6/1/2009]

Sen. Jim DeMint (R-SC): “Now the government has forced taxpayers to buy these failing companies without any plausible plan for profitability. Does anyone think the same government that plans to double the national debt in five years will turn GM around in the same time?” [6/2/09]

Rep. Tom Price (R-GA): “Unfortunately, this is just another sad chapter in President Obama’s eager campaign to interject his administration in the private sector’s business dealings.” [6/2/09]

Rep. Lamar Smith (R-TX): The auto company rescues “have been the leading edge of the Obama administration’s war on capitalism.” [7/22/09]

Rep. Trent Franks (R-AZ): When government gets involved in a company, “the disaster that follows is predictable.” [7/22/09]

They were prepared to let the industry die, or in Romney’s infamous words, “let Detroit go bankrupt.” With the benefit of hindsight, we now know they were wrong and Obama was right.

I suspect we’ll hear some gloating in Charlotte this week, and at least in this case, it’ll be understandable.

Auto Industry

Auto industry rescue continues to pay off

Updated