The Dark Side of Obama's Auto Industry Bailout

September 10, 2012 RSS Feed Print

Barack Obama is running for re-election as the man who saved General Motors. More than that, he wants us to believe he saved the entire U.S. auto industry and something on the order of 1.5 million jobs up and down the automakers' supply chain.

It's a specious argument. As we now know, the bailout had more to do with preserving the existing contracts the United Autoworkers Union have with GM & Chrysler than with the health of the corporate bottom line or institutional longevity.

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Lost in the discussion of what might have been saved has been any thorough examination of what has been provably lost. Of the way the time-honored rights of corporate bond holders were debased by Obama's deal. Of the number of jobs lost due to the government's closure of dealerships. Of the impact on ordinary Americans who held warranties on General Motors and Chrysler products made by divisions that have ceased to exist. Of the impact on workers who were not members of the United Autoworkers Union.

Perhaps we'll hear more from President Obama and Vice President Joe Biden about this part of the auto bailout as the campaign progresses. One place to do it could be in Dayton, Ohio, where Biden is scheduled to make a campaign stop Wednesday at Wright State University.

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Biden will no doubt be seeking plaudits from the working class types who populate this prototypical Middle American community. There are some waiting for his arrival, however, who likely want to give him a piece of their mind. You see they worked for Delphi, the primary auto parts supplier for GM. They were not members of the United Autoworkers Union. Obama's auto bailout, as this short video produced by Let Freedom Ring, where I am a senior fellow, explains, didn't work out so well for them.

Obama didn't stand by them. Obama didn't bail them out. Instead, he cut them loose, costing them their pensions, their health benefits, and their life insurance. By some estimates, close to 20,000 Delphi employees were harmed, not helped, but harmed by what Obama did.

[See a collection of political cartoons on the 2012 campaign.]

The administration has tried to push the blame for what happened to the Delphi workers onto the federal Pension Benefit Guarantee Corporation but, as The Daily Caller—one of the few media outlets to take a close look at the situation has reported—there are E-mails that "demonstrate that White House and Treasury officials were behind the pension terminations and that Secretary Tim Geithner and his Treasury Department were the driving force pushing them."

During the Democratic National Convention in Charlotte, N.C., the General Motors bailout was mentioned over and over again, as many as 150 times by one count. What happened at Delphi was mentioned not at all. Yet the consequences are just as real, if not more so, than what the administration did for and to GM. Maybe Vice President Biden will talk about this in Dayton, where about 2,000 of the company's retirees live. Then again, don't bet on it.