Chrysler, GM to Romney: Stop Lying

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OCTOBER 31, 2012

Chrysler, GM to Romney: Stop Lying

Mitt Romney’s attempts to mislead Ohio voters about the auto bailout get more brazen by the day. And if you don't believe me, listen to company officials from Chrysler and GM. 

They tried hard to stay out of the presidential campaign. Although both companies were beneficiaries of the rescue package President Obama authorized in 2009, over the summer they started refusing requests to use their factories as venues for candidate events. "It pulls us off focus and the reality is we need to stay focused," a GM spokesperson told Reuters.

But now officials from the companies are speaking out. And they are seriously pissed off.

The provocation is a series of advertisements that the Romney campaign is running in Ohio—one on television, the other on radio. Both imply that Chrysler is moving car production from the U.S. to China. The radio ad, first reported by Greg Sargent of the Washington Post, has an additional twist. It suggests that GM is outsourcing, too. Here's an excerpt:

Barack Obama says he saved the auto industry. But for who? Ohio, or China? Under President Obama, GM cut 15,000 American jobs. But they are planning to double the number of cars built in China—which means 15,000 more jobs for China.

And now comes word that Chrysler plans to start making jeeps in — you guessed it — China. What happened to the promises made to autoworkers in Toledo and throughout Ohio — the same hard-working men and women who were told that Obama’s auto bailout would help them?

As readers of this space know, the claims about Jeep are untrue. Chrysler may start building Jeeps overseas in order to sell the vehicles in the lucrative and growing Chinese market. It has no plans to shutter or even downsize plants in the U.S.. On the contrary, Chrysler is spending $2 billion to upgrade and expand the plants here, including its massive complex in Toledo. Just a few days ago, Chrysler's Jefferson North plant in Detroit welcomed 1,100 new workers. The Toledo plants should an equal infusion of new workers next year. 

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And General Motors? It turns out the story there is pretty much the same. According to Kristin Dziczek, director of the labor and Industry Group at the Center for Automotive Research,

GM has hired about 4,500 new hourly workers since 2009, and thousands of salaried workers at their headquarters in Michigan, and in plants across the country.

In response to Romney's claims, Chrysler has issued a pair of public statements. The more recent is an e-mail to employees from Sergio Marchionne, CEO of Chrysler's parent company Fiat. "Jeep production will not be moved from the United States to China.” Now GM is weighing in, too—in the bluntest of terms. “At this stage, we're looking at Hubble telescope-length distances between campaign ads and reality.” GM spokesman Greg Martin said. “GM's creating jobs in the U.S. and repatriating profits back to this country should be a source of bipartisan pride.” 

The Romney campaign insists it's done nothing wrong. Spokeperson Andrea Saul told David Shepardson, who has been all over this story for the Detroit News, "Their comments don’t refute anything in our ad." During a rally in Wisconsin on Wednesday, Paul Ryan cited the China story as part of an attack on the auto bailout and said "these are the facts." And in perhaps the most detailed defense of the ads yet, an anonymous Romney adviser told Jon Ward, of the Huffington Post, that the rescue's success is "relative." Given the extent of federal assistance, this adviser suggested, neither Chrysler nor GM should be creating any jobs abroad. Ergo, it's fair to suggest Americans lost jobs because of Obama's intervention.

Let's put aside the question of whether Romney, a former businessman dedicated to free trade, could possibly hold such beliefs. The historical record shows just how absurd this position is. To repeat what I said the other day, the auto industry was losing hundreds of thousands of jobsand on the verge of total collapse when Obama took office. President Bush had given Chrysler and GM a short-term loan, enough to get them through early 2009. Obama then approved a full rescue package, with government managing the bankruptcy and providing the funds to operate during that time. Since the summer of 2009, the industry has added 150,000 jobs—250,000 if you include related jobs in parts and sales. Overall, according to an estimate from the Center on Automotive Research, the rescue probably saved more than a million jobs. 

If Romney’s central claim has provoked such widespread condemnation, why hasn’t he backed down from it? Perhaps because it's his only hope to erase his apparent deficit among Ohio voters. It’s easy to forget now, but in 2008 and 2009 the idea of making massive loans to the auto industry was extremely unpopular. The voters were tired of bailouts and polls suggested their regard for unionized autoworkers was not much higher than it was for Wall Street bankers. In Washington, pretty much everybody without direct ties to the Midwest felt the same way. Those of us making the case for a bailout had very little company even on the left, as my friend and former colleague Jonathan Chait notes:

The idea of extending another bailout to an industry not as central to the entire economy as finance struck even many Democrats as an inappropriate extension of government – numerous internal Obama advisers opposed a bailout, and I remember having a hard time making up my mind before uncomfortably deciding it was worth it.

Based on admittedly anecdotal evidence from my neighbors in Michigan, some of whom work for or with the auto industry, I suspect many Ohio voters are aware of this. They remember that Obama stood up for them when very few people would. They think Obama cares about them—and they think he has guts. The voters of Ohio are unlikely to say similar things about Romney, who has made multiple, conflicting statements about the rescue and, when necessary to please conservative voters, criticized Obama's decision to offer government loans. Romney is trying to make voters forget that history. On Tuesday, we'll find out if he succeeded.

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posted in: jonathan cohn, politics, toledo, and general motors, chrysler, general motors, gm, reuters, the washington post, under, china, united states, barack obama, barack obama, greg sargent, mitt romney, mitt romney, chrysler is, jeep, michigan, ohio, ohio, the plank

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