U.S. auto production bolsters rescue plan

Aug. 22, 2014, 2:46 PM UTC

By Steve Benen

Now, our auto industry is once again a source of economic strength, with more and more of the world's top-of-the-line, fuel-efficient vehicles being made by American workers in American factories. In fact, the number of cars coming off our assembly lines just reached its highest level in 12 years. [...] [T]he number of vehicles built on American assembly lines since 2000 rose to a seasonally adjusted annualized rate of 13.2 million vehicles in July. The increase in auto production mirrors the growing strength of America's manufacturing sector, which has added more than 700,000 jobs since early 2010.

The White House, which produced the above chart, has plenty of reasons to be happy. The first and most obvious, of course, is that a stronger U.S. auto industry is necessarily good news for the domestic economy.

But there's also the matter of who was right in 2009 and who wasn't. President Obama took a big risk launching his rescue policy during the economic crisis. It wasn't a popular idea, and though it looks like a no-brainer with the benefit of hindsight, there was no guarantee the plan would work.

In July 2010, NBC News' First Read said, "As the GM bailout goes, so goes the Obama presidency." More than four years later, the White House probably thinks that sounds pretty good.

And then there are the policy's critics, whose condemnations don't hold up nearly as well.

As we discussed a while back, among Republicans in 2009, failure was a foregone conclusion -- government intervention in the marketplace always fails, they said, and Obama big-government solution to the auto industry’s crisis simply couldn't work.

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]

A guy by the name of Mitt Romney said we could “kiss the American automotive industry goodbye” if the administration’s policy was implemented.

We now know that the right was completely, unambiguously wrong. The U.S. auto industry has been a bright spot on the economic landscape in recent years, and hasn't been this strong in recent memory.

It’s likely pointless to expect accountability for those whose predictions failed miserably, but when it comes to credibility on the economy, folks should keep this story in mind.