UAW calls out Romney on bailout stance

UAW calls out Romney on bailout stance
Danielle Emerson
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Automotive News | February 17, 2012 – 12:50 pm EST
UPDATED: 2/17/12 2:34 pm ET

DETROIT — The UAW today took aim at Republican presidential candidate Mitt Romney for opposing the government bailout of Chrysler and General Motors in 2009.

Romney, campaigning this week for the Feb. 28 Michigan primary election, said he supported a “managed” private sector bankruptcy reorganization for Chrysler and GM. Experts on the bailout — including former Obama auto czar Steven Rattner — have criticized Romney’s position, saying no private funding for bankruptcy reorganization existed at the time, and such an effort essentially would have led to the liquidation of the two automakers.

UAW President Bob King, in a statement today, said Romney is “misleading voters” when it comes to the bailouts.

“He’s trying to rewrite history and attack President Obama and the UAW for successfully saving the auto industry,” King said.

The UAW said it has made concessions since 2005, giving up pay increases, overtime pay and holidays and agreeing to a reduced pay and benefit structure for new hires.

As a result, more than 1.4 million jobs and $96 billion in personal income nationwide were saved, according to a November 2010 report by the Center for Automotive Research in Ann Arbor, Mich.

King said the rescue loans helped the auto industry survive “the darkest hour of its history,” citing workers from Chrysler’s Sterling Heights, Mich., assembly plant who faced a plant closing before Chrysler received its loans.

The plant builds the Chrysler 200 and Dodge Avenger for the United States, as well as the European version of the 200, the Lancia Flavia.

Jeff Klayo, a member of UAW Local 1700 at the plant, said in the UAW statement that Romney’s remarks were “an attack on American workers.”

“If the company’s successful, we can be successful,” he said. “If the company takes a downturn, we take a downturn with it.”

A Romney spokeswoman said it was no surprise that the UAW would oppose “Romney’s proposals to help turn around the automotive industry.”

“Under Mitt Romney, the restructuring would have succeeded while protecting the taxpayers and the principles of free enterprise, not the union bosses at the UAW,” Amanda Henneberg, a Romney campaign spokeswoman, said in an e-mail to Automotive News.

‘Suicidal course’

Michigan Gov. Rick Snyder, a Republican, gave his official endorsement to the fellow Michigan native Romney on Thursday, despite differing opinions on the industry bailout.

In 2008, Romney campaigned for president in Michigan sympathizing with those who lost jobs in the industry and blaming Washington for the problem.

Ten months later, he suggested that the government should let GM and Chrysler go bankrupt rather than extend a federal bailout, a report by Bloomberg notes.

Shortly after Arizona Sen. John McCain lost the 2008 presidential election to President Obama, Romney wrote an op-ed in The New York Times that the government should deny the Detroit automakers’ request for a bailout. With the bailout, he warned, “the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses.”

Santorum’s suggestion

One of Romney’s opponents seeking the GOP presidential nomination, former U.S. Sen. Rick Santorum of Pennsylvania, also has opposed the industry bailout.

At a Detroit Economic Club luncheon Thursday, Santorum said GM and Chrysler would have been “alive and equally as well, or better off, than they are now” without bailouts, multiple media reports have noted.

Santorum said he blamed former President George W. Bush more than President Obama for the bailout, and that “the markets would have reacted to restructure it to be more competitive.”

Resurgence

King’s statement pointed to GM’s status as the world’s largest automaker and the company’s profit in 2011 as examples of why the bailouts worked.

“The auto industry added more than 200,000 jobs in the last two-and-a-half years, and 2011 was the strongest year of industry job growth since 1994,” he said. “Added shifts and new facilities mean jobs for thousands more workers in Michigan, Ohio and other places across the country.”

On Thursday, GM reported its net profit for 2011 at $7.6 billion, driven largely by stronger pricing and increased sales in North America. The profits for GM meant profit-sharing bonuses of as much as $7,000 for 47,500 eligible UAW members and was up an average of $4,300 for the company’s U.S. union workers last year.

Bloomberg and Mike Colias contributed to this report.

PRESS RELEASE: Autoworkers react to Romney statements on auto loans

DETROIT ¬- UAW members reacted strongly to Mitt Romney’s claim that “we should have let Detroit go bankrupt,” when the economy and the auto industry were about to collapse.

“He’s trying to rewrite history and attack President Obama and the UAW for successfully saving the auto industry,” said UAW President Bob King. “He is misleading voters about the president’s bold and decisive rescue of the auto industry and about sacrifices made by workers. But voters deserve the truth.”

Even prior to the emergency rescue loans, UAW members made deep sacrifices beginning in 2005 to save the company, giving up pay increases, overtime pay, holidays, agreeing to a reduced pay and benefit structure for new hires, and other concessions. President Obama demanded additional concessions and shared sacrifice from both labor and management in exchange for the loans.

In return, America’s carmakers retooled to create the energy-efficient cars of the future and repaid their outstanding loans years ahead of schedule.

Rescuing the auto industry saved more than 1.4 million jobs up and down the supply chain.

“There’s not a person in Michigan who doesn’t have a sister or brother or cousin or friend who is tied to the auto industry,” said Stacie Steward, a UAW Local 1700 member and an electrician from Chrysler’s Sterling Heights Assembly Plant (SHAP) in Sterling Heights, Mich. “Every Michigan citizen should be appalled by what Mitt Romney said.”

“It’s an attack on American workers,” said Jeff Klayo, also of Local 1700 and from SHAP, which was scheduled to close before Chrysler received the loans. “We’re out there trying to get the American dream. We’re trying to keep our jobs, for a good wage for our family, put food on our table, pay our taxes, continue to work for the company and get the rewards.

“If the company’s successful, we can be successful. If the company takes a downturn, we take a downturn with it,” he added.

“The president’s rescue loans helped the auto industry survive the darkest hour of its history and return to thriving operations today,” said King. “These workers from SHAP are evidence. They, along with hundreds of thousands other workers who depend on the auto industry for jobs, were facing a very uncertain future, but today, they are making the Chrysler 200, one of Detroit’s new, hot-selling models. UAW members completed negotiations with the domestic automakers this fall with a strategy to make the company successful and to share in its success. And that strategy paid off.”

“Americans deserve to know the truth,” King added. “The emergency loans worked. GM is once again the world’s top carmaker. Its 2011 profit was its largest ever. The auto industry added more than 200,000 jobs in the last two-and-a-half years, and 2011 was the strongest year of industry job growth since 1994. Demand for their cars is going up, so GM, Ford and Chrysler are starting to run three production shifts a day at many plants. Added shifts and new facilities mean jobs for thousands more workers in Michigan, Ohio and other places across the country.”

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