Only in the incredibly polarized politics of America today can it be bad news for so many that General Motors, once again the world’s largest automobile manufacturer, reported its largest annual profit in its long history.

Yes, it is bad news for many Republicans because General Motors is to them “Government Motors” run totally by the Obama administration, who designs cars from the White House.

Sound crazy? Of course, but two weeks ago at a House hearing on GM, representative Darrel Issa (R-CA), stated “This unnatural relationship has blurred the lines between the public and private sector as President Obama touts the survival of General Motors as one of the top accomplishments of his administration.

“On a policy level, this relationship raises serious questions about whether or not the administration is too heavily invested in the success of GM to be an effective regulator.”

The “unnatural relationship” is that the federal government bailed out GM and Chrysler in 2008. The government still owns 26.5 percent of the auto manufacturer.

In 2008 the American banking system was near collapse and President Bush had implemented the now demonized TARP program to bail out the U.S. financial system.

As a by-product of the banking problems banks were not making car loans available to any historical level, impacting retail sales negatively, and the economy overall began what was to become the steepest decline since the Great Depression.

In this environment General Motors and Chrysler found themselves unable to self-fund the drop in sales and financial losses and unable to borrow from the broken financial system the funds needed to survive the recession and financial implosion.

The new President, Barack Obama, stepped forward and authorized a federal bailout to save both the industry and the potential negative impact its failure would have on the overall troubled economy.

As many as three million jobs are directly and indirectly related to the U.S. auto industry, and with unemployment about to rise to 10 percent the loss of millions of jobs would have thrown the economy perhaps beyond recession and into depression.

But we will never know that possibility because the president bailed out the industry.

Historically, U.S. presidents have bailed out industries deemed “too big to fail” particularly when those industries have impact on national security, as does the auto industry.

Earlier bailouts included the 1970 bailout of Penn Central Railroad (President Nixon), the 1971 bailout of Lockheed Aircraft (Nixon), Chrysler in 1980 (Carter), and, among others, the 1989 Savings and Loan crisis (G.H.W. Bush).

Nevertheless, most Republicans refused to support the bailout once this Democratic president supported the bailout.

The same Republicans had sat on their hands when President Bush had extended bridge loans to the automakers. Saving the industry and the economy? Well, that was just a bridge too far for Republicans.

It remains a bridge too far today, even though the bailout has revived this American industry and is now contributing to a growing economy with jobs and manufacturing.

Mitt Romney is touring Michigan as a presidential candidate, saddled with his wrong decision to advocate breaking up GM and Chrysler through bankruptcy. Rick Santorum would also have refused the industry a bailout.

But millions of Americans are working today who know the decision saved jobs and saved a crucial American iconic industry.

It is time to give Barack Obama credit for a courageous decision.

 

Jim Crawford is retired educator and political enthusiast living here in the Tri-State.