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The Obama administration went here before, when it tried to quantify how much worse things would have been without its stimulus bill. And considering the task force has enjoyed access to GM and Chrysler’s business plans, it’s surprising that this graph (from the Auto Task Force’s just-released Bailout “report” [PDF]) is based on notoriously iffy BLS data. Instead of projecting how many jobs were saved by Detroit’s $86b life raft, couldn’t the White House have cited GM and Chrysler’s pre-bailout Chapter 11 plans? Or were there pre-bailout bankruptcy plans? Either way, the Task Force’s claim that 56k jobs have been created in Automotive since mid-2009 is a bit hard to swallow given the SIGTARP’s recent finding that
Treasury made a series of decisions [regarding the bailout-era dealer cull] that may have substantially contributed to the accelerated shuttering of thousands of small businesses and thereby potentially adding tens of thousands of workers to the already lengthy unemployment rolls.
By narrowing a broad bailout to just the manufacturing side (the report leaves out dealer cuts and the GMAC rescue), the Task Force is simply defining its way to victory. Besides, the problem is that there’s really no way of knowing what might have happened without last year’s landslide of government sugar. For all we know, Fiat might have bought a bankrupt Chrysler with its own money. GM might have shuttered dying brands and cut its bloated capacity of its own volition. Both might even be in mediocre-to-OK shape right now. The only thing we know for sure is that the auto bailout has been a qualified success at best so far. Luckily for the bailout boosters, it will be years before Treasury fully divests from GM and Chrysler, so there will be plenty of other opportunities to declare victory.
More by Edward Niedermeyer
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Telegrap hRoad pretty much sums up my position on the auto bailouts, also thank God SOMEONE remembers this was a bi-partisan effort. I don't live in the midwest and my state is not connected very much to the auto industry, but I'd hate to see a region of this country, any region, turn into an economic wasteland. The country needed to lend a helping hand to the midwest, and I'm happy it did. I have no problem with my tax dollars doing that. As to the budgets, FY 2009 was Bush's last budget, Obama's first budget is FY 2010. FY budgets are passed a year in advance. EDIT: It also nicely illustrates how out-of-touch many member of Congress are that when big Wall St. bankers came hat-in-hand begging for money in September in 2008, they got it easily, while when CEOs of industrial companies that actually make stuff asked for a much smaller amount of money they were treated like radioactive waste by many members of Congress.
I know NHTSA hired a bunch of engineers when the Senate found out they had a couple of fulltime ones. Of course more staffing at NHTSA for Toyota cases! Does this off set the 35,000 lost with the dealership closings? Probably not. Can't wait until we see how many $100,000 government jobs related to auto industry it created. Ten board members including car czar in s task force to over see bankruptcy of two companies with a secretary and support for each. I could probably find more.