White House senior adviser David Plouffe declared that today there wouldn’t have been an US auto industry if Republican Mitt Romney had been president.
The American automotive industry was close to extinction. Mitt Romney would have let it go away, by the way. We wouldn’t have an automotive industry if he was president. President Obama secured that,” Plouffe said.
Romney denied the accusations and said that he would have helped Chrysler and GM with loans, only after they entered bankruptcy. Obama campaign senior adviser David Axelrod said that thanks to the President’s intervention people are better off today than four years ago. Although Romney is aware that these statements are true, he rejected the comments and Sean Fitzpatrick, a Romney campaign spokesman, said that Obama’s hostility to job creators has failed Michigan and the nation’s economy.
Chicago Mayor Rahm Emanuel argued that the only thing Romney did was to advocate policies that led to the financial meltdown, the economic recession and a collapsed auto industry. He praised Obama that he managed to rescue and revive the auto industry after a near collapse in 2008, and that voters should take into consideration the impact Obama’s $85 billion auto bailout had on the overall industry.
Without government’s help automakers would have entered an uncontrolled bankruptcy and even an outright collapse. In his last weeks of presidency, George W. Bush decided to offer Chrysler and GM a $25 billion bailout. Obama added a $60 billion loan and put the two automakers through quick bankruptcy restructurings in 2009.
“In the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action,” said Bush in December 2008.
The Treasury Department estimates a loss of over $25 billion for the $85 billion auto bailout. The government must sell the 500 million shares of GM stock for about $53 each to be able to recover the $49.5 billion bailout.