As Steve noted earlier, the American automobile sector continued to strengthen this year. U.S. auto companies are on track to sell nearly 12.8 million cars and trucks in 2011, compared to 10.6 million during the recession year of 2009, when Detroit was in freefall. “The industry has pretty much hired back just about everybody from the automotive side that had been laid off. And now they’re hiring fresh, so they’re actually adding to their rosters,” an industry analyst told McClatchy.
This is more good news for the economy, and further evidence that Barack Obama made the right choice when he decided on a federal government take over and restructuring of the industry early in his presidency. Needless to say, he got virtually no support for that tough call from the GOP. Mitt Romney dubbed the decision “tragic,” and said private bankruptcy would be a better route (understandable, since, at Bain Capital, he’d sent a number of companies into bankruptcy, some of which survived the process).
It’s also worth remembering the predictions other prominent Republicans made at the time:
Rep. John Boehner (R-OH): “Does anyone really believe that politicians and bureaucrats in Washington can successfully steer a multi-national corporation to economic viability?” [6/1/09]
Sen. Richard Shelby (R-AL): “It’s basically going to be a government-owned, government-run company…. It’s the road toward socialism.” [5/29/09]
RNC Chairman Michael Steele: “No matter how much the President spins GM’s bankruptcy as good for the economy, it is nothing more than another government grab of a private company and another handout to the union cronies who helped bankroll his presidential campaign.” [6/1/2009]
Sen. Jim DeMint (R-SC): “Now the government has forced taxpayers to buy these failing companies without any plausible plan for profitability. Does anyone think the same government that plans to double the national debt in five years will turn GM around in the same time?” [6/2/09]
Rep. Tom Price (R-GA): “Unfortunately, this is just another sad chapter in President Obama’s eager campaign to interject his administration in the private sector’s business dealings.” [6/2/09]
Rep. Lamar Smith (R-TX): The auto company rescues “have been the leading edge of the Obama administration’s war on capitalism.” [7/22/09]
Rep. Trent Franks (R-AZ): When government gets involved in a company, “the disaster that follows is predictable.” [7/22/09]
These GOP leaders couldn’t have been more wrong in their predictions. But who in Washington called it right? That would be the Washington Monthly. In the spring of 2009, as the Obama administration was debating internally what to do, the Monthly ran a story by Phil Longman making the case that the government was perfectly capable of turning around the industry, just as it had done with the railroad industry twice before in our history. Indeed, Longman argued, “the greatest danger may well be not that government will intervene too much, but that it won’t intervene enough.”
Longman’s piece is yet another example of the kind of journalism the Washington Monthly strives for: well-researched, well-argued stories that take on rigid ideological thinking and Beltway conventional wisdom — in this case, the lazy idea that government intervention in the economy can’t possibly lead to anything good.
If you value that kind journalism, not to mention the daily dose of sanity you get from this blog, now’s your chance to support it. We’re in the midst of our annual year-end fundraising drive, so click here and pony up a few bucks — $10, $20, $30, $50, whatever you can afford. Donations to the Monthly are tax-deductible — we’re a non-profit outfit, and really appreciate and rely on the help we get from readers to continue to do what we do.