People will be talking for years about Rick Perry’s cringe-inducing inability to remember what he thinks (assuming he does) in the Michigan GOP debate. But his campaign has been such a disaster that this particular moment can hardly be called a turning point.
In contrast, Romney has an excellent shot at being the Republican nominee. If he could win Michigan in the general election, President Obama’s electoral map would look very bleak indeed.
But he blew it by saying that he wished that GM and Chrysler had gone bankrupt. Based on my years living in Michigan, I would liken this remark to walking into the Vatican and telling the Pope to go to hell.
Expect some brutal ads featuring his bankruptcy gaffe in the year to come.
Old Irish saying: Touch the Devil you can’t let go.
To win the Republican primary, merely touching Crazy won’t get it done.
You’ve got to run your hand up it’s blouse and make some lip-smacking sounds like Rush.
By the way, Rush Limbaughlingus spent the night in the Lincoln bedroom courtesy of Ron Reagan.
A killer question we will never hear, but one that all candidates should have to answer:
Will Rush Limbaugh be invited for a White House sleep over when you are President?
It was a sure thing that they would have http://www.nytimes.com/2008/11/19/opinion/19romney.html?pagewanted=print to pull out if need be, but that dates from 2008 and perhaps Romney would have tried to write it off as ancient history. THis ought to stick more tightly.
This comment might be useful in Ohio and Indiana, as well. I doubt Obama can win Indiana (or if he can, it certainly won’t be #270), but a convincing head fake might be useful.
I’d note, as somebody who lived most of their life in Michigan, and worked at an automotive supplier, that Chrysler, and GM in particular, are not all that popular. Indeed, we laughed hysterically when Lopez screwed GM over the way they’d had him screwing us suppliers over.
So, let me say with feeling: I wish the government had let GM and Chrysler go bankrupt. (Which did not, of course, entail their ceasing to exist.) This isn’t going to get me to vote for Romney, whom I have entirely sufficient reason to loath, but it does make me loath him a bit less. And I’m sure many in Michigan would share that sentiment.
Brett,
Bankruptcy does not entail the liquidation of a firm because functioning capital markets can profit from the reorganization, and therefore provide the cash needed for the reorg to work. In 2008, there were no functioning capital markets. Therefore, bankruptcy in 2008 would have entailed liquidation of the firms.
Context matters.
Brett seems like the type who will gladly cut his nose off to spite his face
Adding on to this, how would the supplier networks have faired with the disruption to their customers? Even a ‘short’ several-month disruption.
And I’m sure many in Michigan would share that sentiment….
A sureness backed up with mere anecdotal smugness? Really Brett, I realize you Ayn Rand boys think reality begins at the border of your foreheads, but your “anecdata” here serves only to reinforce your own skewed perceptions. I wonder, did Aristotle have a logical error encompassing both smugness and confirmation bias? If so, this is a “bingo” example.
For whom the smug tolls: Word.
Brett Bellmore: What a bizarre and unsubstantiated assertion. You need to get out more.
I’m willing to bet that Brett and his social network would have laughed, right up until the doors of their employer were padlocked. Then they’d blame it on the government, and on Obama (the bankruptcy probably occurring before Obama took office not being an obstacle to blame).
And people like Brett in MI, OH,IN,etc. will vote Republican until h*ll freezes over. Remember, even in 1936, FDR only got (from memory) 75% of the vote.
Brett, let’s not fool ourselves; if Romney is the nominee, as seems inevitable, you will be voting for him. Heck, given the clown cavalcade that is the field, I’d not bet against your voting for him in the primary.
Um, this is a hard conversation to have without mentioning that both companies did in fact declare bankruptcy.
Mitt tossing out EPA makes him the first credible challenger to Lloyd Bentsen’s claim to fame. Brilliant, Machiavellian, and subtle enough to induce a bite. “Defense” would’ve been too obvious but if had bit, man o man…Perry wouldn’t be able to beat George Soros in a Republican primary.
However, a super-genius would’ve tossed of “DOD”. I can see Perry taking that bait, and maybe not even catching himself. But Mitt was clearly going off the cuff while Lloyd had his all planned out.
GM and Chrysler did “go bankrupt.” They both filed for Ch. 11 bankruptcy protection and used it to restructure their debts and obligations. They did it with government funding.
Romney says that he would have preferred “a managed bankruptcy process” without government funding: “My plan, we would have had a private-sector bailout – a private-sector restructuring.”
Well, that would have been very nice. Me, I would prefer a Park Avenue apartment and a yacht docked at Monte Carlo. Romney is saying he would have preferred something that was impossible in order not to admit that the only alternative to a government funded restructuring was liquidation and the end of manufacturing in the midwest.
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When considering Romney’s wish that GM and Chrysler had gone bust (maybe he thought that “bankrupt” was just a nice way of saying “out of business”?)one might keep in mind (along with a tongue in cheek)that his dad was president of American Motors, so his sentiments might be a bit colored by that background.
Look, since my teens, I’ve worked at suppliers for the automotive industry. My dad was a master machinist at the Fischer Body Tech center. It’s just anecdotal, I know, but I don’t know anybody who likes GM. They were quite casual about bankrupting their suppliers. Payback would only have been a delight, and somebody was going to be building the cars, and thus employing us.
And the free market relies on firms being permitted to fail, for it’s healthy operation. “Too big to fail” isn’t free market capitalism, it’s crony capitalism. The only sort of capitalism this administration has any tolerance for, it seems.
Heck, if Chrysler had been permitted to go under, maybe GM would have caught a clue, and fixed it’s problems in time.
So, yes, I wish they’d been permitted to fail. Businesses should not be rescued from failure. Ever. Not automotive companies, not banks, nobody.
What do you mean by “rescued”? The shareholders got wiped out. Some rescue. Management was canned. Some rescue. GM and Chrysler, as pointed out above *did* go bankrupt. What the government did was to step in and manage the bankruptcy process. In exchange for providing the financing for the process, the government got an equity stake. It went out of its way to avoid running the company and has started selling off that equity.
And since you adamantly oppose a free market in labor, I don’t understand your dogmatic insistence that we fetishize free market approaches in situations where the government can rather clearly do the same job more efficiently.
What the government did was step in and manage the bankruptcy process so as to make sure that the debtors who were favored by the government got a better deal. We have bankruptcy laws, they were circumvented to make sure the politically connected did better than they were legally entitled to, at cost to others.
Just more crony capitalism.
Whilst allowing GM and Chrysler to collapse, per Ebenezer’s 7:34, would have been a very bad thing, Mr. Bellmore actually makes several cogent points in this thread - and I say that as a poster who has agreed with BB perhaps twice in nine years or so. For people who have and managed to keep high-ranking, high-paying positions at the Big 3 life is good, but those organizations have problems and pathologies that are as large as their economic size.
Cranky
Which debtors were favored?
Ooops sorry guys. I fed the troll. My bad.
Yeah, as someone who knows many Michigan residents, there isn’t a lot of love for the auto industry. But people in Michigan understand that the alternative to a government funded bankruptcy (which has been repaid has it not?) was better than the alternative. Brett is just trolling you guys and everyone knows it.
Brett, *all* bankruptcy actions are about making sure that some debtors get better deals than others. They are *all* about the debtors favored by government getting a better deal. That’s what bankruptcy is about. There is no particular reason why bondholders should be preferred over labor when it comes to recovering assets other than that the government has always preferred them. Workers signed contracts just as binding as those that debt creditors do. Despite that, the bondholders get to go to the front of the line. That’s favoritism.
You don’t object to crony capitalism. You object when the cronies you like aren’t favored.
As for those bondholders, I am not convinced that they got a worse deal than they otherwise would have. They got a worse deal than they would have had some private entity stepped forward with as much financing as the federal government was willing to provide. There is no evidence that any such private entity existed. Absent government intervention, all that would have remained of GM was the liquidation value of its assets. All of the dealers would have been out of luck. All of the parts suppliers, which you seem so concerned about, would have been out of luck and out of customers.
I am tired of the practice of making sure that bondholders are catered to while everyone else suffers. Why is it that the Michigan law that allows for the state to take over local governments explicitly states that labor contracts can be voided but that bond contracts must be protected? What makes some contracts so much more sacred than others?
Screw it. The GM bankruptcy was one case of the shoe being on the other foot. Welcome to the game of getting screwed. The rest of us have been playing it for a long time.
Look, J, we have these things called “laws”, and they dictated, in advance, before creditors loaned GM money, how a bankruptcy would be handled. You might be “tired” of the practice, but Obama had to over-ride the law, behave in a lawless fashion, to circumvent it, in order to produce an outcome more favorable to his political supporters. Yes, it was crony capitalism, nothing but.
“Why is it that the Michigan law that allows for the state to take over local governments explicitly states that labor contracts can be voided but that bond contracts must be protected? What makes some contracts so much more sacred than others?”
Because they want people to actually be willing to loan them money. I thought that much was obvious.
IIRC, some debtors fought the deal in the courts, and lost.
Indeed. Brett’s argument that Obama had to override the law crashes and burns in the face of a federal bankruptcy judge disagreeing with him.
I see that Brett is so concerned that municipalities might not have have anyone loan them money but is utterly unconcerned with the idea that it screws the people who work for them. He completely avoided my question: given that a collective bargaining agreement is a contract just like a bond agreement, where in your philosophy does it allow for some contracts to be voided by one party to it, but not other contracts? I am getting the feeling that Brett just doesn’t think that labor agreements should be taken seriously. Why should workers have to face that uncertainty, but not bondholders?
You also haven’t answered my other question: do you have any evidence that there was private financing ready to step in for a bankruptcy without federal government involvement? Without that, there was never a chance that the bondholders would have been made whole. Their choices were to take a loss while the industry was bailed out or to take a loss (probably larger than they did) without GM being bailed out.
docdave, that wouldn’t change a thing. It’s not that people in Michigan necessarily think of GM and Chrysler as great firms and model employers. The problem is that hundreds of thousands of jobs in Michigan depend either directly or indirectly on GM and Chrysler. (For what it’s worth, Michigan was where I had been living most of my life before I got married.) Bankruptcy or being out of business is a distinction without a difference here; for political purposes, Democrats will play this as Romney being willing to kill hundreds of thousands of Michigan jobs. Combine that with all the stories about Romney’s business career, and it’s going to be a difficult line of attack for him to defend against.
Katja: Absitively correctamundo.
Romney and his family is well known and well liked in Michigan. His father was a driving force in the auto industry for years and Mitt understands the workings of auto companies better than any other candidate for president in 2012. To reduce Romney’s statement to simple “bankruptcy=closure” is just not fair. Romney has often stated that instead of forcing taxpayers to pay for union benefits by giving a portion of the automakers to them, that the automakers should have reorganized under a Chapter 11 reorganization. A Chapter 11 would have been a better alternative to what occurred with the government prop-up. This was no gaffe by Romney.
As far as I can tell, this comment by “Marc Richter” is a real comment. I have no reason not to believe the commenter is sincerely putting forth their political beliefs. That being said, they have apparently used the URL field to support some sort of commercial Search Engine Optimization scheme; I’d recommend that someone with moderating ability remove the hyperlink.
Thanks Warren — done.