President Obama hailed Chrysler’s repayment of its 2009 bailout loans Tuesday and took credit for the automaker’s revival.
The White House said the repayment “marks a significant milestone for the turnaround of Chrysler and the countless communities and families who rely on the American auto industry.”
“Supporting the American auto industry required making some tough decisions, but I was not willing to walk away from the workers at Chrysler and the communities that rely on this iconic American company,” Obama said in a statement.
“I said if Chrysler and all its stakeholders were willing to take the difficult steps necessary to become more competitive, America would stand by them, and we did,” Obama said.
That message is part of a broader effort by Democrats and the Obama campaign team to build political support for the president based on the 2009 bailouts of Chrysler and General Motors.
But the White House omitted one item the Treasury Department had in its initial release: The U.S. won’t likely recover its outstanding $1.9 billion investment in Chrysler.
Nonetheless, the president and his allies seem to believe the rescue of Chrysler and GM is an arrow in Obama’s political quiver.
The Democratic National Committee (DNC) trotted out two former Midwestern governors, Michigan’s Jennifer Granholm (D) and Ohio’s Ted Strickland (D), to proclaim the Chrysler news.
Granholm homed in on former Massachusetts Gov. Mitt Romney (R), a Michigan native, for opposing the bailouts.
“If Mitt Romney and these other Republicans had their way, Michigan families, and Midwestern families, would have been left out in the cold and would have lost their jobs and their way of life,” she said on a DNC conference call. “These voters aren’t going to forget who stood with them when they needed it.”
The DNC also released a video on Tuesday morning attacking Romney and other Republicans for opposing the bailout.
A spokeswoman for Romney’s presidential exploratory committee responded that Obama wasted taxpayer money in the auto bailouts.
“President Obama spent billions of dollars in taxpayer funds to bail out the auto industry,” Romney spokeswoman Andrea Saul said. “Mitt Romney argued that instead of a bailout, we should let the car companies go through a restructuring under the protection of the bankruptcy laws. This is the course the Obama administration eventually followed. If they had done it sooner, as Mitt Romney suggested, the taxpayers would have saved a lot of money.”
Chrysler said it was paying both the initial money the government put up in the controversial auto bailouts, as well as $1.8 billion in interest, six years ahead of schedule. The company borrowed $5.1 billion from the U.S. government and $1.6 billion from Canada.
“Less than two years ago, we made a commitment to repay the U.S. and Canadian taxpayers in full, and today we made good on that promise,” Chrysler CEO Sergio Marchionne said in a statement. “The loans gave us a rare second chance to demonstrate what the people of this company can deliver, and we owe a debt of gratitude to those whose intervention allowed Chrysler Group to re-establish itself as a strong and viable carmaker.”
The controversial auto bailouts originated under former President George W. Bush, but it was Obama who was widely criticized in 2009 for intervening in the affairs of the auto companies as his administration managed the assistance to Chrysler and General Motors.
Federal officials placed conditions on the loans, which critics said were not placed on the assistance that was given in 2008 to Wall Street banks during the economic crisis. The government also memorably removed the head of General Motors in 2009, leading critics to refer derisively to the car company as “Government Motors.”
Obama responded in a news conference by famously declaring, “I don’t want to run auto companies. I don’t want to run banks.
“I’ve got two wars to run,” Obama said in April of 2009. “The sooner we can get out [of Chrysler and GM], the better off we’re going to be.”
Now that the automakers are recovering, the Obama administration has sought to take credit for the revival of the American car companies, saying they would not have survived the economic downturn if the president had not shown them “tough love.”
This story was posted at 1:07 p.m. and updated with new information at 1:17 p.m. and 7:50 p.m.