U.S. Republicans still believe auto bailout was a bad idea

Leading Republican presidential candidate Mitt Romney, who hails from Michigan, believes auto bailouts were a mistake.

Most Republican Party candidates for president think the auto bailouts that saved GM and Chrysler and kept afloat a large part of the U.S. industrial base were a bad idea.

And they're joined by their Republican colleagues in the United States Congress who aim to challenge President Obama on his claim that the bailouts have been a resounding success.

At a GOP (Grand Old Party - a nickname for the Republican Party) presidential debate in New Hampshire earlier this month, Mitt Romney, a front-runner for his party's nomination for president, said of the Obama administration's auto bailout policy, "[Obama] was able to put his hands on the scales of justice and give these companies to UAW." The UAW is the union that represents U.S. auto workers. In the case of GM, the UAW received a share of the company in exchange for concessions on health-care benefits and pensions.

But the auto bailouts actually began in late 2008 and were also the policy of the administration of George W. Bush.

Romney risks losing lots of votes in Michigan, home to many auto industry workers. Romney also hails from the state, although his most significant political credential comes from serving as governor of Massachusetts.

At the debate, other candidates chimed in and agreed with Romney.

"It was a wrong vote then," said Representative Michele Bachmann of Minnesota. "It's continued to be a wrong vote since then."

Former Pennsylvania senator Rick Santorum called the bailouts a 'tip to the cronies, tip to the unions, [giving] the unions the company."

But GM and Chrysler have flourished since their quick trips in and out bankruptcy. GM has had a successful IPO and has begun paying back its government loans. The company is also in the black and selling a record number of cars in China - the world's largest auto market. Chrysler is now owned by FIAT and has repaid its loans almost in their entirety already.

President Obama has been touring U.S. auto plants recently and touting the bailouts as a success, something Congressional Republicans are hoping to challenge since the Democratic Party is getting a lot of mileage from the popularity of the bailouts. The House Oversight and Government Reform subcommittee, controlled by Republicans, held a hearing last week on the "Lasting Implications of the General Motors Bailout" to counter some of the claims made by the White House.

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Automaker Chrysler
Article type Industry
Tags auto bailout, auto bailouts, bailouts, chrysler bailout, chrysler bankruptcy, gm bailout, gm bankruptcy, gop, gop presidential candidates, mitt romney, republican party, u.s. auto bailout