The Incredible Chutzpah of Mitt Romney

Here, via the Huffington Post, is a new low point in the very low candidacy of former Massachusetts Gov. Mitt Romney for the presidency of the United States.

He’s actually said he’ll “take a lot of credit” for the recovery of the auto industry. His words, folks, not mine.

Mitt Romney campaigns in Charleston, SC. Photo: Howard R. Gold/The Independent Agenda.

Here’s what he told a Cleveland radio station:

I pushed the idea of a managed bankruptcy…And finally, when that was done, and help was given, the companies got back on their feet. So I’ll take a lot of credit for the fact that this industry’s come back.

Yes, as the piece points out, this is the selfsame Mitt Romney whose notorious November 2008 op-ed, “Let Detroit Go Bankrupt,” appeared in The New York Times.

The headline was written by The Times, but the sentiment was all his:

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. …Without that bailout, Detroit will need to drastically restructure itself… Detroit needs a turnaround, not a check.

Like the good management consultant and private equity investor he is, Romney laid out a restructuring plan: cut jobs, cut worker pay and benefits, cut executive pay and perks, and fire top executives. Note the emphasis on cutting and firing? This was right out of the Bain Capital playbook.

To be fair, he also urged auto companies, with the government’s help, to invest more heavily in research and development “on new energy sources, fuel-economy technology, materials science and the like.” (Solyndra, anyone?)

Steven Rattner. Photo: Financial Times

But his idea to restructure the industry through a “managed bankruptcy” had a fatal flaw.  Successful bankruptcies require cash to keep businesses afloat and substantial investments to help them emerge as going concerns. And cash was the one thing that wasn’t available at the height of the financial crisis.

In another New York Times op-ed, Steven Rattner, lead adviser on President Obama’s auto task force, called out Romney for his “fantasy” and “delusions”:

 

 

In late 2008 and early 2009, when GM and Chrysler had exhausted their liquidity, every scrap of private capital had fled to the sidelines.

Without government financing…the two companies would not have been able to pursue Chapter 11 reorganization. Instead they would have been forced to cease production, close their doors and lay off virtually all workers once their coffers ran dry.

Those shutdowns would have reverberated through the entire auto sector, causing innumerable suppliers almost immediately to stop operating, too…

More than a million jobs would have been lost, at least for a time. Michigan and the entire industrial Midwest would have been devastated.

The auto industry has come roaring back, with profits and sales skyrocketing for once-bankrupt GM and Chrysler. The bailout was President Obama’s one unadorned economic success.

But Romney will say anything to win Ohio and Michigan this fall. For him to take credit for saving the auto industry while advocating withholding the one thing that made it work—government money—is either monumental gall or a bald-faced lie.  His campaign has shown he’s capable of both.

 

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