News Column

Auto Rescue Remarks Haunt Romney In Michigan

May 10, 2012

Paul Egan

Mitt Romney

Every time native son Mitt Romney returns to Michigan in his bid to become the first Republican in 24 years to carry the state in a presidential race, he is likely to re-ignite debate over his opposition to the federal rescue of the Detroit-based auto industry.

Some Michigan political analysts said after Romney's latest visit -- a campaign stop Tuesday in Lansing -- that it creates a significant challenge for him in the state. The better the auto industry is doing, the more difficult Michigan will be for the GOP candidate, added one.

Romney provided fresh grist for the debate Monday when he told a reporter in Ohio that he actually deserved "a lot of credit" for the resurgence in the domestic auto industry. Although he opposed the government loans to keep struggling General Motors and Chrysler afloat in 2008 and 2009, Romney said he "pushed the idea" of a managed bankruptcy. He said his idea eventually was adopted, and "I'll take a lot of credit for the fact that this industry has come back."

The former Massachusetts governor's version of events is challenged not just by Democrats and union officials, but by independent experts on the automotive industry.

"He's really being very disingenuous when he speaks about his idea about a structured bankruptcy," said Bruce Belzowski, an assistant research scientist at the University of Michigan's Transportation Research Institute in Ann Arbor.

Without the government loans extended first under Republican President George W. Bush and later under Democratic President Barack Obama, both the car companies and their supplier networks likely would have collapsed, putting an additional 1 million to 3 million Americans out of work at the height of the recession, Belzowski said Tuesday.

"There was no private money available, especially in the amount of money that was needed for the companies to go through a structured bankruptcy without the government loans," he said.

GM posted a $1-billion first-quarter profit last week; Chrysler had a first-quarter operating profit of $740 million, and Ford, which didn't take government loans, had a first-quarter net income of $1.4 billion. The companies have been hiring, opening closed plants and cutting back on their usual summer shutdowns.

Michigan residents mostly supported the loans to the auto industry, even when it wasn't clear the companies would survive. A December 2008 EPIC-MRA poll of 600 likely voters found 69% supported the first loan proposal and 26 percent were opposed. A poll by the same firm taken two years later found 65 percent of Michigan voters thought the loans were a good idea. That contrasts with national polls showing a slight majority of Americans opposing the loans.

After stirring controversy with his comments Monday, Romney was silent on the auto rescue in his Tuesday speech at Lansing Community College, his first return to Michigan since winning the state's GOP primary Feb. 28. Instead, he launched a broader attack on Obama's economic record, saying the last four years have been tough on Americans.

"For a lot of folks, things like vacations and movies and restaurants, these are things of the past," Romney said. "His four years have been a disappointment to all of us and a catastrophe for a lot of us. ... Americans are tired of living on the edge."

About a dozen Romney supporters carrying signs were on Capitol Avenue in front of the auditorium about two hours before Romney was to speak.

Kody Hitchcock, 24, of Lansing, an LCC alum who also attended Western Michigan University, held a sign that read: "I'm a Mitt-chigander."

Hitchcock, who works for an express delivery company, said he wants less government spending and cuts to programs as he works to repay about $10,000 in student loans. He said he thinks that is more likely to happen under Romney than under Obama, whom Hitchcock calls a free-spending Democrat.

Asked about Romney's position on the auto industry loans, Hitchcock said that if U.S. companies can't compete with foreign automakers without assistance, they again will be in need of government help in the future.

About a dozen demonstrators from the UAW protested across the street from the auditorium.

Mike Huerta, a member of UAW Local 602 who works at GM's Delta Township plant, said he was laid off for eight months during the worst of the recession. But the plant now is running three shifts and hiring, he said.

"He's trying to fool people who have not been paying a lot of attention," Huerta said of Romney.

Romney's failure to mention the auto industry rescue was noted by EPIC-MRA President Bernie Porn, who said the better the car companies are doing, the worse the issue looks for Romney in Michigan.

"He didn't say anything about it today," Porn said. "That kind of speaks volumes in and of itself."

Still, political analysts expect a close Michigan battle between Romney and Obama.

"The Democrats will clearly try to make it the overriding issue," but "it's over, it's done, things are moving forward," said Republican pollster Steve Mitchell of Mitchell Research & Communications in East Lansing.

Republicans were less supportive of the government loans than Democrats, and "I don't know how this plays with independents," Mitchell said.

To Bill Ballenger, editor of the newsletter Inside Michigan Politics, the issue is "an albatross around Romney's neck" as he tries to win Michigan.

"It's going to be a big issue," Ballenger said. "The real question to me is, how is he going to explain it?

"So far, I don't think people are buying it."

Source: (c)2012 the Detroit Free Press

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