Report claims Romney profited from auto bailout

By Keith Laing - 10/18/12 02:44 PM ET

Republican presidential candidate Mitt Romney drew $15.3 million in profits from companies that were involved in the bailout of the U.S. auto industry, alleges a new report released Thursday by the liberal magazine The Nation.

Romney opposed the $80 billion in federal loans that were given to General Motors and Chrysler in 2008 and 2009, but the report claims the former Massachusetts governor made money from hedge funds that took over a General Motors part supplier.

The Nation's report said Romney and his wife Ann invested in a hedge fund operated by one of his campaign donors, Paul Singer, that made $1.28 billion from the auto bailout after buying Dephi Automotive.

The company, Elliot Management, put Delphi on the public stock exchange after purchasing it from GM, The Nation report says, and by 2011, investors in the auto-part company made $15.3 million for each $1 million in stock they purchased.

"The Romneys might insist that the funds were given to Singer, Mitt’s key donor, only through Ann’s blind trust," writes author Greg Palast in the report. "But as Mitt Romney said some years ago of Ted Kennedy, 'The blind trust is an age-old ruse, if you will. Which is to say, you can always tell a blind trust what it can and cannot do.' Romney, who reminds us often that he was CEO of a hedge fund, can certainly read Elliott Management’s SEC statements, and he knows Ann’s trust is invested heavily in a fund whose No. 1 stake is with Delphi.

"Mitt Romney may indeed have wanted to let Detroit die," the Nation article continues. "But if the auto industry was going to be bailed out after all, the Romneys apparently couldn’t resist getting in on a piece of the action."

Romney's campaign did not deny that he profited from the auto bailout in an email to The Hill Wednesday afternoon, but it said the the report showed the Detroit intervention was "misguided."

"The report states that Delphi had 29 US plants before the misguided Obama auto bailout, and just four after. Is this really what the president views as success," Romney spokeswoman Michele Davis said.

"Mitt Romney would have taken a different path to turning around the auto industry," Davis continued. "As President, Mitt Romney will create jobs and give American workers the recovery they deserve."

Democrats have used Romney's opposition to the auto rescue to paint the GOP challenger as out-of-touch with middle-class voters. They contend he wanted to "let Detroit go bankrupt," referencing the title of an op-ed Romney penned criticizing the taxpayer bailout.

Romney has said the industry would have been better served by forcing auto companies through a managed bankruptcy without the federal bailout funds.

The company discussed in the Nation report, Delphi Automotive, also has sparked controversy over its the treatment of its employees' pensions in the bailout. Delphi went into bankruptcy in 2009, after approximately $1 billion in bailout money from the federal government was used to pay pensions for union workers at the company.

-This story was originally posted at 2:44 p.m. and it was updated with a response from the Romney campaign at 4:05 p.m.