3:07 PM CDT, September 5, 2012
We heard it last night from former Ohio Gov. Ted Strickland, and we'll probably hear it a hundred times more before the Democratic convention is over: "Barack Obama saved the American auto industry." It's a great line, especially in battleground states like Ohio and Michigan. Too bad it's not true.
In the first place, it didn't start with Obama. Republicans may not want to mention it anymore than Democrats do, but the original life preserver to General Motors and Chrysler was tossed out by George W. Bush. He tapped a federal fund to provide $13 billion in loans to the companies, which kept them afloat until Obama arrived to expand the effort.
Obama's decision may have saved GM and Chrysler, but they're not the entire U.S. auto industry. In fact, there are ten other companies that make cars in this country, and they got nothing from the feds. If anything, they got hurt by the subsidy extended to their competitors, whom they had outperformed fair and square. Also unmentioned last night is that the bailout will cost taxpayers more than we were originally told -- $25.1 billion instead of $21.7 billion.
GM and Chrysler may have been in danger of disappearing, but the auto industry was not. Obama can claim all the credit, but the rest of us are paying a high price for their rescue.
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