According to a report released yesterday by the Center for Automotive Research, government action supporting the auto industry prevented a $26.8 billion loss to the American taxpayer and saved nearly 1.5 million American jobs. And today’s initial public stock offering of the newly-reformed General Motors has analysts predicting taxpayers will be repaid for much of the emergency intervention. Bloomberg:
The U.S. government avoided a $28.6 billion loss and saved more than 1.45 million jobs by bailing out the automotive industry, a research group said today.
The loss would have been caused by increased public welfare payments and lost tax receipts from workers had the government not provided $82 billion of assistance to the industry, said Kristin Dziczek, director of the labor industry group at the Center for Automotive Research in Ann Arbor, Michigan…
“You could argue that because the auto industry is one of the most productive and integrated industries, putting the money there was a better place to put it than job creation in any other sector,” Dziczek said.
Congressional Republicans, working on behalf of the special interests, made no secret of their opposition to Democratic initiatives to save the American auto industry. From Politico, “Republicans Hope General Motors is President Obama’s Hurricane Katrina”:
In news conference after news conference this week, they slammed the administration for taking a roughly 60 percent stake in GM as part of the bankruptcy proceedings. That decision, they argue, will result in lawmakers getting intimately involved with the daily workings of the troubled company…
…House Minority Whip Eric Cantor (R-Va.) said in a New York radio interview Thursday: “Washington, the president, Congress, none … has any business running that car company. They’ll run it into the ground.”
Republicans also argue that the White House has put the taxpayers on the hook for billions of dollars, money that they may never see repaid if the company continues to founder.
Speaker Pelosi on General Motors’ initial public offering today:
General Motors’ initial public offering is a sign of progress for America’s auto industry, for our nation’s workers, for our manufacturers and our long-term prosperity. In the midst of a severe recession, Congressional Democrats and President Obama took difficult emergency action to rescue American auto companies and strengthen critical pillars of our manufacturing sector, while protecting taxpayers. Today we have more evidence that those actions are paying off, and the American people are one step closer to being made whole.
Preserving, bolstering, and expanding our manufacturing base is central to our economic growth, our national security, and our competitiveness on the global stage, and key to establishing America’s manufacturers as centers of innovation. Democrats’ ‘Make It In America’ strategy rests at the core of our ongoing efforts to create good-paying jobs, invest in a clean energy economy, and rebuild our middle class. We know that when we make, grow, and build it in America, our country grows stronger; our workers grow more secure; and our nation leads the world economy.
I hope GM’s progress spurs leaders on both sides of the aisle to work together to continue investing in our manufacturers, in our workers, and in jobs for our middle class.