The bailouts last year of GM and Chrysler were very controversial. Ford didn’t get a bailout, but the company urged the government to bail out its competitors, arguing that it was critical to keep the domestic supplier base for the auto industry in place. Without it, many suppliers would have gone bankrupt, and millions would have lost their jobs.
More than one year later, the US auto industry is thriving, and President Obama has been touring auto factories to drive that point home. Today he stopped at a Ford Motor Company Chicago Assembly Plant in his home town of Chicago, Illinois, checking out the new Ford Explorer. According to reports, Ford said the plant will add 1.200 new jobs made possible by a Dept. of Energy loan that is intended to help companies retool to make fuel-efficient vehicles.
The bailout is still a source of political conflict.
On Thursday, Republicans criticized Mr. Obama’s visit here because, unlike G.M. or Chrysler, Ford turned itself around without taking a federal bailout. “Desperate To Claim Economic Victory, Obama Visits Ford Plant To Tout Success He Had Nothing To Do With,” read the headline on a statement from the Republican National Committee.
White House officials countered that Ford benefited from the industry bailout even though it did not accept aid itself, because the federal money kept a network of suppliers in business. They also pointed to the industrywide boost from the government’s cash-for-clunkers program, which used tax credits to encourage consumers to trade in older, more polluting cars for new models last year.
Moreover, officials noted that Ford used a $400 million loan from the Energy Department to retool the plant Mr. Obama visited on Thursday, which now builds an energy-efficient line of Explorers. And Mr. Obama arrived with more help for Ford — a $250 million loan guarantee from the Export-Import Bank to finance the export of 200,000 vehicles to Canada and Mexico.
The article also points out that “the auto industry added 55,000 jobs over the last year, the first net gain in a decade, and its exports were up 57 percent in the first four months of the year.”
The success seems apparent, but we have a toxic political environment and it’s an election year, so you can expect to see plenty of arguments on this point.
