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View Diary: Same BS, different day: Mitt Romney still not admitting he was wrong on Detroit (95 comments)

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  •  Mitt has tried to disavow the headline (8+ / 0-)

    "Let Detroit Go Bankrupt" as saying that the NYT made it up, not him.  (His website points that out.)  He's also tried to make the whole "managed bankruptcy isn't like a liquidation" argument.  

    But here's the thing: Mitt's op-ed in the times was SEVERELY against the auto bailout ultimately implemented by President Obama. Here's how the op-ed begins, as reproduced on his website:

     IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.
    In other words, Mitt predicted that what President Obama did wouldn't work. What did Mitt say was needed?
     The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.
    But as President Obama pointed out last night, GM needed pre-petition DIP (debtor in possession) financing in order to go IN to bankruptcy.  That sort of financing is critical to any company trying to reorganize. It just wasn't available in the private markets in late 2008 and early 2009 -- I know, I was involved in an automotive parts company's bankruptcy proceeding during that period -- and GM's potential for coming out of bankruptcy as a going concern if it went in without DIP financing was NIL, NADA, NONE. Mitt's just wrong when he says there was private financing available. Wrong. So much for his financial acumen.

    I wish Obama had pointed out how wrong Mitt was not just in terms of the policy, but in terms of his prediction. Mitt said if the auto industry got bailed out, nothing would change, and the auto industry would still fail. But GM is alive and bin Laden is dead instead.

    •  The Economist apologized for doubting bail-out (1+ / 0-)
      Recommended by:
      tardis10

      Government Motors no more
      An apology is due to Barack Obama: his takeover of GM could have gone horribly wrong, but it has not

      But I like this headline from The Economist:

      Mitt Romney and the car industry
      A Detroiter in his own mind

      Romney wrote an Op/Ed for The Detroit News in February to clarify his infamous op/ed. From The Economist:

      The purpose of Mr Romney's op-ed is to clarify his position on the auto bail-out ahead of Michigan's primary on February 28th. And the piece rivals Cirque du Soleil in its display of contortions. Mr Romney seems loth to gush about the success of the bail-out, noting only the good news that "Chrysler and General Motors are still in business". He certainly doesn't mention that 2011 was the best year for America's carmakers since the financial crisis, with each of the big three turning a solid profit. But he does imply that this achievement is a result of his own advice. "The course I recommended was eventually followed", Mr Romney writes.
      . . .But the course Mr Romney recommended in 2008 began with the government stepping back, and it is unlikely things would've turned out so well had this happened.
      Free-marketeers that we are, The Economist agreed with Mr Romney at the time. But we later apologised for that position. "Had the government not stepped in, GM might have restructured under normal bankruptcy procedures, without putting public money at risk", we said. But "given the panic that gripped private purse-strings...it is more likely that GM would have been liquidated, sending a cascade of destruction through the supply chain on which its rivals, too, depended." Even Ford, which avoided bankruptcy, feared the industry would collapse if GM went down. At the time that seemed like a real possibility. The credit markets were bone-dry, making the privately financed bankruptcy that Mr Romney favoured improbable. He conveniently ignores this bit of history in claiming to have been right all along.
    •  He defended the headline on TV (0+ / 0-)

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