Auto bailout could be key to Obama victory in Ohio

President Barack Obama's decision to help America's automakers could end up being what helps drive him back into the White House.
Associated Press
Oct 24, 2012

Some 850,000 jobs in this critical battleground state are tied to autos and Obama's campaign constantly reminds voters they'd be jobless if not for the decision to inject taxpayer dollars into General Motors and Chrysler. However, the move has not translated into automatic support for the president, even in areas that depend on the industry. Republican Mitt Romney also is pitching these voters hard with his message that Obama hasn't balanced Washington's checkbook the same way voters must.

One in eight jobs in Ohio can be linked to the auto industry — whether it's working on a factory floor or selling groceries to plant workers. The presidential race's outcome could boil down to whether voters interpret Obama's move as saving Detroit or bailing it out. But like other flashpoints in this rough campaign, there is little middle ground between the versions of events and what it means for voters' neighbors.

"I couldn't imagine what Lordstown would be," said Brian Axiotis, a 37-year-old Obama supporter who works in information technology and lives in nearby Newton Falls. "A lot of folks would lose their houses. Consider the mess that would have resulted. It'd be a ghost town all over the area."

Since its restructuring, the General Motors plant in this town of 4,000 people southeast of Cleveland has added a third shift — and 1,200 new workers with it — to produce the popular compact Chevy Cruze. GM has pledged $220 million in updates to the factory and to keep the 4,500 workers, suggesting this town in the former steel-heavy Mahoning Valley has some stability ahead.

Romney volunteer Frank Perrotta still finds Obama's decision to loan automakers billions a misuse of public dollars. Between calls to voters at Romney's office in Stow, he shakes his head when talking about the government's move to prevent the collapse of GM and Chrysler. The bailout began in 2008 under Republican George W. Bush and Obama extended it.

"I have to run my business responsibly. No one is coming to bail me out if I get into trouble," said Perrotta, a 63-year-old Hudson resident who runs a medical imaging business that employs nine workers. "The bailout was just not fair."

Romney opposed using government money to save the car companies in a 2008 op-ed piece in The New York Times, titled "Let Detroit Go Bankrupt." Romney preferred a managed bankruptcy, without federal money, and has maintained the rescue was unfair, unnecessary and political payback to labor unions.

"If we had taken your advice, Gov. Romney, about our auto industry, we'd be buying cars from China instead of selling cars to China," Obama said in Monday's presidential debate.

His statement sparked one of the most contentious moments of the evening, with the two interrupting and arguing over one another about what impact Romney's idea would have had. "I would do nothing to hurt the U.S. auto industry," Romney said, touting his affection for American cars, his Detroit roots and his father's leadership of American Motors Corp.

Obama insisted Romney was "trying to airbrush history" and suggested voters should check the record.

While GM paid back its loan and the government took an ownership stake, the Treasury Department estimates Washington might lose about $25.1 billion on its investment. It smacks of government waste for its critics.

"They should've followed the bankruptcy process that applies to the rest of us who don't have union bosses for friends. They bailed out their buddies," said Loretta Hurite, a 74-year-old Romney supporter from Cuyahoga Falls working the phones in Stow.

And so it continues through the state, where polls are close and both campaigns are in overdrive. No Republican has ever won the White House without carrying Ohio, and John F. Kennedy's 1960 campaign was the last Democratic effort to win the presidency without it. Voters here are bombarded with campaign ads and candidate visits, mail at the ends of their driveways and phone calls at all hours.

Obama's allies never hesitate to raise the bailout in visits to the state. "Osama bin Laden is dead, and General Motors is alive," Vice President Joe Biden roars at rallies, always a sure-fire applause generator.

Obama's team even has former President Bill Clinton making the point.

"It's important to remember than one in eight jobs in the state of Ohio is tied to the auto industry," Clinton told voters in Parma last week. "When you were down and you were out, the president had your back. Now, you've got to have his."

Not so fast, says Dennis Muniak, a 60-year-old Parma resident who attended the Clinton rally near Cleveland.

"Seven out of eight jobs aren't auto jobs," countered Muniak, who is drawing disability benefits.

Back in Trumbull County's city of Warren, just across the railroad tracks from the Lordstown plant, General Motors retiree George Vukovich cast his ballot early for Obama.

"In this valley, we are autos. Obama took care of us. He kept his promise. Now, we have to have his back," the 61-year-old Vukovich said before acknowledging the auto industry's heyday might be in its past.

Across the street from the early voting site, weeds are growing high at a car audio shop that has shut its doors. A retail plaza next door is vacant.

"We were lucky. We worked through the glory days of the 1970s, '80s and '90s," Vukovich said. "Those days are over. But I have great insurance and I have a great retirement."

Thanks to the taxpayers, Chuck Wirebaugh clucks.

"Obama sold out to the auto unions. GM would be better off had it gone through bankruptcy like everyone else has to. Instead, they got special treatment and a sweetheart bailout," the 69-year-old retiree from Cortland said after he cast his ballot early for Romney.

"Obama shouldn't have the job," Wirebaugh said. "He should be a used car salesman. It's about the only thing he's qualified to be."

 

Comments

sanduskysteve

You mentioned taxing everyone the same - I have been saying that - but you don't pay much attention to my posts - unfortunately, the GOP doesn't want that route - they are only for things that lower the taxes on the rich. Give Romney 1 year and he would make things so bad people would run to Canada and elsewhere to get away from the disaster. You keep saying taxing the rich won't help - it surely did when Clinton did it. And Bush destroyed everything Clinton did that was good. Forget the bad thing that he did. It really didn't effect a single person in this country.

Riskkbreaker

http://www.commentarymagazine.co...
@sanduskysteve Read that article and then re-think everything you have said about the economy.

The Big Dog's back

So you Repubs are finally taking responsibility for crashing our economy?

John Harville

Starr... Really?
"Have you looked at stock market lately? Have we reached 14000 yet? If not we are not better off today... period!" Why is 14,000 a landmark? We were at 7,000 when President Obama took office. Now we are over 13,000! If we were at 14,001, you'd cry because we are not at 15,000.
"When you become in charge, all the responsibilities becomes yours." REALLY? So, to follow your reasoning, when my stepfather married my mother he assumed all the problems my father left behind?
"Still finding out facts that this president is not for this country!" So why haven't you voted for Romney? You still must have doubts. How did your paycheck get smaller. Your house value has gone down because of all the unfit mortgages written before 2008, before foreclosures by the hundreds, before bank failures, before.... Obama.
Put the blame where it belongs - in the only branch of government that raises revenues and creates budgets - the House of Representatives.

There you go again

Unions won
Everyone else lost!

phroggy

I have to remind everyone that GM did in fact file and go through bankruptcy. The bailout was to avoid a lengthy restructuring process. I can't stand Obama but the route he chose for GM was a good one. Also, let us not forget that the federal government did NOT bailout Chrysler the same way. Italy owns their debt.

John R Lott certainly has a point but fails to list ALL the facts. BTW, economists are a dime per dozen. Much like meteorologists, they get paid whether right or wrong.

Phil Packer

The so called "glory days" of the 70's, 80's, and 90's were the same time that the Japanese auto makers got a foothold in our market. If you bought an American made car in the late 70's or the 80's, then you know why that happened. GM should have folded back then.

Contango

Mr. Romney suggested govt. "bridge loans" for the auto cos. as was done for Chrysler under Pres. Carter.

GM is using subprime loans and channel stuffing to boost sales of it's U.S. products.

In Italy, Fiat is a financial mess.

With nationalization, the U.S. taxpayers only temporarily put off the future bankruptcy of both GM and Chrysler.

Gov. Romney's op-ed from '08:

http://www.nytimes.com/2008/11/1...

deertracker

Oooooo... those subprime loans again? What about that Wall St. bailout? C'mon, cheer up.

Contango

@ deertracker:

Didn't the U.S. taxpayer "bailout" GM once already?

It's from the liberal Huffington Post so it's safe for you to read:

http://www.huffingtonpost.com/20...

the office cat

And what was that lawsuit filed yesterday against Bank of America?

2cents

(The so called "glory days" of the 70's, 80's, and 90's were the same time that the Japanese auto makers got a foothold in our market.)

I had a friend that worked at New Departure, he would punch in sneak under the fence and party all night only to come back and punch out. He was caught but not fireable because of the union strength. I also restored cars and when I repainted my 1975 Cutlass there were only three of the six screws in place to hold in the tail light assembly. The Japanese used quality control programs that are instituted today; they are expensive and drive up costs. I recently lost work to China because of price, well ISO certification required by auto makers’ costs money, when they saw they could save money they ran to China and left us with a nice quality program they mandated, go figure.

As for China, Obama has not mentioned it for four years, why now? Romney and his companies may have gone there, I am going there now to compete, it is a vicious circle and there are no magic bullets. If you want to try and make a difference then stop buying the widgets you need that are marked “Made in China” Ha Ha! You can’t, almost all consumer items are now made there and how would any politician make any sudden change. Personally I believe that the change will only come as the Chinese people desire a better standard of living, this will take time so keep buying your widgets or go without. Oops! Then there is another country to move to.

the office cat

Obama hasn't mentioned China in four years? He took a lot of verbal lashing when he stopped inferior tires and - at the urging of the Chamber of Commerce and many likeminds - he has refrained from naming China a currency manipulator though he has discussed repeatedly the problems with Chinese currency.
Among his 'day one' activities, Romney will make the 'manipulator' charge - and then see what happens when you "go there to compete".

Contango

@ the office cat:

The Fed has been trashing the dollar. The yuan is currently at a record high against the USD.

http://online.wsj.com/article/SB...

Finn Finn

"We were lucky. We worked through the glory days of the 1970s, '80s and '90s," Vukovich said. "Those days are over. But I have great insurance and I have a great retirement."

Honestly, I really believe that people like this are just too ignorant to realize how hurtful and offensive a statement like that is. I'm not trying to be insulting or mean but do these self-absorbed people ever think before they speak? The boasting by some of these people just provokes more ill will. Yeah, we get it. You're retired and living the life of Reilly on a GM pension. Now go and "share the wealth" with your non-UAW neighbor. ZIP-IT for Pete's sake!

the office cat

A world of "people like this" make up most of the posters here... they'll be happy to tell you about their gold, and their investments, and their comfortable pensions - and you don't even have to ask.

I don't begrudge anybody a pension earned in hard work.

I only wish I had lived during those 'glory days'... of 18% Reagan mortgages (oh, I did)

Contango

@ the office cat:

So you did you enjoy Mr. Carter's stagflation and gas lines more?

sanduskysteve

Carter's gas lines were a very large scam committed by the oil companies. I worked at a gas station pumping gas during that time adn I can tell you they had so much gas they didn't have room to store it all and the delivery drivers were told DO NOT COME BACK WITHOUT AN EMPTY TRUCK so the drivers were literally giving the extra away to top off storage tanks at various gas stations otherwise they would have to just dump it someplace. There was no gas shortage and I believe that all came out later. Of course, did the oil companies get into trouble for that? Absolutely not - they are protected by the government. Just like they are now with their price fixing activities and gouging.

Finn Finn

I'm still trying to figure out what the point of your first paragraph is??? That's pretty much what I was saying!

Most people won't begrudge anyone a pension earned in work (in light of the subject matter, let's leave the word "hard" out and not insult everyone's intelligence, okay?). What offends so many "ordinary" non-UAW people is that the tax dollars taken out of their HARD EARNED paychecks is going to sustain the comfortable pensions of these boastful (still working or retired) UAW people (aka 'people like this'). Most blue collar pensions will amount to only a fraction of a UAW pension. And these folks will all admirably manage somehow to make ends meet, and probably with a heck of a lot more grace than their bombastic UAW neighbors.

The UAW likes to project that they are blue collar, hard working, the voice of middle America. Yet, at the same time, they like to think they are superior within the middle class by virtue of their inflated wages, benefits, pensions. They rage on and on with envy at the millionaires, bankers, CEO's, etc., yet they sure like to crow about how great their wages, benefits, retirement plans are to those who aren't "intelligent and ambitious enough" to be UAW. Sarcasm intended.

John Harville

I'm still trying to figure out what you can't figure out about Cat's first paragraph.
Oh... is it that most of the posters here are UAW workers/retirees?
Or... do you have a grudge against UAW?
Or... were you 'hit' by the Bain Capital move of Delphi to China?
Or... do you begrudge most anything better than what you have?

OMG.LOL.WT_

Just wait 'til "let em go bankrupt" Mitt gets in. Everyone will have a job. Ha Ha Ha

the office cat

If you have any doubt who's going to carry Ohio, just read this blog. Cats recognize 'scaredy' more readily than others.

the office cat

OMG... yup, everyone in China.

the office cat

Oct. 25, 2012
Executives Who Support Tax Increases to Fix the Deficit
Executives at more than 80 major U.S. corporations released a statement in October to pressure Congress to reduce the federal deficit with tax increases and spending cuts. The declaration differed sharply from those of other business groups that urge Washington to deal with the deficit and avoid across-the-board spending cuts and tax increases, but avoid any stance on the issue of raising taxes
Wall Street Journal. I can post articles, too. You should see the names on the list. Really. You should!

the office cat

FIX THE DEBT... to drop a few: Aetna, Alcoa, Allstate, AT&T, BoA, Boeing, Cisco, Honeywell, Marsh & McClennon, RR Donnely, State Farm, T Rowe Price, Time Warner, UPS, Walgreen, Weyerhauser... well, you can get a taste.

Randy_Marsh

Isnt that the list of lobbyist Obama has working in the white house?

John Harville

@RAndy... the Obama lobbyist list?
Hardly.
Some of them are his staunchest enemies.

Randy_Marsh

Some of them are his biggest supporters from 2008. Oh Dont forget GE and most of the unions got in to the WH among others. The "I will get rid of lobbyist" doesnt mean give them jobs in the WH.

mikel

the problem with that putty tat is that prezo wants to raise taxes but NOT reduce spending! he wants to ramp up entitlement programs and continue with failed programs that he started.

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