Chicago mayor: No auto industry if Romney had been president

October 9, 2011 http://detnews.com/article/20111009/AUTO01/110090328

Chicago mayor: No auto industry if Romney had been president

DAVID SHEPARDSON
/ Detroit News Washington Bureau

Chicago Mayor Rahm Emanuel said Sunday that the United States wouldn’t have an auto industry if Republican candidate Mitt Romney had been president.

In an interview with NBC’s “Meet the Press,” Emanuel, a former Chicago congressman who served as President Obama’s first chief of staff, criticized former Massachusetts Gov. Mitt Romney’s approach to the auto industry.

“There would not be an auto industry if Mitt Romney was president. He would have said, ‘Let it go bankrupt,'” Emanuel said, arguing the nation is a “stronger country” after the turnaround of the U.S. auto industry.

President George W. Bush gave General Motors Co., Chrysler Group LLC and their finance companies a $25 billion bailout.

The Obama administration added another $60 billion to the auto industry bailout and put GM and Chrysler through government-sponsored bankruptcies in mid-2009 and put the companies under new management.

Emanuel touted Obama’s restructuring of the auto industry. “He entered a financial situation that had frozen up to the point where it was near collapse and an auto industry on the door of bankruptcy,” Emanuel said. “At every level, the auto industry that was first started here in the United States, is stronger and better and more prepared for the future than it was when he was in office.”

Obama “doubled down” on American workers, Emanuel said, echoing a re-election campaign theme.

The Romney campaign rejected Emanuel’s comments.

“Mitt Romney argued that instead of a bailout, we should let the car companies go through a restructuring under the protection of the bankruptcy laws. This is the course the Obama administration eventually followed. If they had done it sooner, as Mitt Romney suggested, the taxpayers would have saved a lot of money,” Romney spokesman Ryan Williams said Sunday.

Emanuel also touted the fuel efficiency standards and the administration’s efforts to ramp up battery capacity. The government awarded $2.4 billion in grants in 2009 – as part of the $787 billion stimulus — to spur battery production and electric vehicles – and has also awarded billions in low-cost government loans to boost electric vehicle production.

Romney told The Detroit News last month that he was right to call for managed bankruptcy filings of GM and Chrysler in late 2008 — and he pledged a speedy sell off of the government’s remaining stakes in GM and Ally Financial Inc.

“They needed to move into a managed bankruptcy process rather than getting money up front by President Bush or President Obama,” Romney said. “They wasted a lot of money.”

In August, the Treasury upped its estimate of predicted losses on the $85 billion auto bailout to $14.3 billion. Since then, GM’s stock has fallen sharply — and the government could lose $15 billion or more on its GM bailout.

Government could have played a role in standing behind warranties — or in bankruptcy financing. “If government is needed to get the DIP, the debtor in possession financing, that’s something you look at,” he said.

Critics of Romney’s approach say automakers were unprepared for bankruptcy in late 2008 — and that without an immediate government help they would have been forced into an uncontrolled bankruptcy or collapse.

Romney rejected the idea that Republicans were willing to let the auto industry die.

“I’m happy to stand up next to anybody in my affection for the auto industry and my conviction that America can compete in automobiles — at home and abroad,” Romney said. “My plan of a managed bankruptcy was essential to getting the auto companies on their feet.”

Emanuel also touted Ford Motor Co.’s plan to add a third shift at its Chicago Assembly plant and said it would mean the Dearborn automaker would add 1,200 jobs there.

The UAW said the tentative labor deal with Ford Motor Co. includes the new shift in Chicago and to “continue with Explorer and Taurus” and “insourcing the police vehicles” as part of a new $117 million proposed investment.

The Romney campaign didn’t immediately respond to a request for comment Sunday.

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