WASHINGTON — It was a deeply unpopular move, according to polls at the time. Faced with auto giants on the brink of collapse, the newly elected president authorized an $80 billion government bailout to rescue Chrysler and General Motors.
Barack Obama’s 2009 decision turned out to be pivotal not only for the auto industry and the Midwestern economy, but perhaps for the future of his presidency. Three years later as Obama campaigns for reelection, the controversial bailout has allowed him to secure Michigan and puts him within striking distance in Ohio, a critical battleground state where 1 in 8 jobs are auto-related.
“The bailout is a very big deal in Ohio, especially in the northern tier of the state,” said John B. Russo, a labor studies professor at Youngstown State University and codirector of the state’s Center for Working Class Studies. “It’s one of the things a lot of working people are going to hold against Romney.”
The latest polls show Obama and Mitt Romney going head to head in Ohio; a survey by a consortium of Ohio newspapers Sunday has them tied at 49 percent. According to the poll, the bailout made 29 percent more likely to vote for Obama, and 21 percent less likely, while almost half said it would not make a difference. No Republican has ever won the White House without Ohio.
Romney — who repeatedly criticized the bailout during the Republican primaries, in his book, “No Apology,” and most infamously, in his 2008 New York Times column headlined “Let Detroit Go Bankrupt” — is scrambling to undo Obama’s auto advantage. Romney has attempted to dial back his initial opposition, emphasizing in last week’s debate that he “would do nothing to hurt the US auto industry” and that he had supported government help through a managed bankruptcy.
“It has absolutely hurt him,” said Patrick Haney, a political science professor at Miami University in Oxford, Ohio. “Romney hasn’t been able to get the traction in Ohio as he has in Colorado. He can try to say, ‘It’s more complicated than that when I said, ‘Let them go bankrupt.’ But people hear, ‘Let them go bankrupt.’ ”
Last week in Defiance, Ohio, Romney told voters that he would fight to keep jobs in America, while saying Chrysler planned to move production of its Jeep models from Ohio to China. Even after Chrysler said it has no such intent, Romney’s campaign released a 30-second ad in Toledo on Sunday that implied the outsourcing of Ohio jobs and said Romney would do more for the auto industry. Democrats slammed the ad as “desperate” and “dishonest.” Romney’s campaign did not respond to a request seeking comment.
The Romney campaign, which held rallies in Ohio on Monday before suspending events for Hurricane Sandy, made its own pitch to autoworkers and their families. Senator Rob Portman, an Ohio Republican, in introducing Romney in the Cleveland suburb of Avon Lake, singled out members of the United Auto Workers in the audience.
“It’s the policies that Mitt Romney and Paul Ryan want to put in place that are going to be good for the auto industry and makes sure it stays in Ohio,” Portman said.
The Obama campaign fought back in Ohio on Monday with an ad that portrayed Romney as having turned his back on the auto industry, and called him out on his assertion that Jeep would ship jobs to China when it is adding 1,100 jobs in Ohio.
In a teleconference Monday, Steven Rattner, former head of Obama’s auto task force during the bailout, said he credits Ohio’s 7 percent unemployment rate, below the national average of 7.8 percent, to the bailout. “Imagine what the economies of places like Lordstown and Toledo would be like if Romney allowed Detroit to go bankrupt,” Rattner said.
Lawrence Summers, head of Obama’s National Economic Council during the economic crisis, said in a separate interview that Romney has never been clear what he was advocating for, shifting his position with the political winds.
“The president didn’t pay attention to the polling,” Summers said. “He asked us whether it was the right thing and we all thought there was no certainty it was going to work, but the risks to the economy were much greater if we let the companies go rather than preserving them.”
In Lordstown, Ohio, where GM’s plant employs 4,500 and supports thousands more jobs in the community, the auto bailout is considered by many to be a lifeline for the local economy.
“It saved my job. It saved all our jobs,” Burton Pollock, a longtime tool and dye maker at the Lordstown plant, said in an interview.
In late 2008 and early 2009, the plant, which manufactures the Chevy Cruze and Cobalt models, laid off about 1,700 workers.
“There is a very strong argument among autoworkers that had it not been for Obama we would have seen something much, much worse,” said Frank Hammer, a retired GM worker and an organizer of the Autoworker Caravan, a nonprofit established in 2008 to advocate for employees of the Big Three automakers in the face of cutbacks.
Sean McAlinden, chief economist and vice president for research at the Center for Automotive Research in Ann Arbor, Mich., said that without a bailout, northern Ohio would have seen 10 or 11 percent unemployment. The fruits of the bailout were recently highlighted by GM’s announcement that it will invest $200 million to upgrade the Lordstown plant and build the 2015 model of the Cruze there.
But the bailout hardly cements the vote of unionized autoworkers or auto suppliers who benefited, many of whom support Romney, Russo said.
“In Ohio, part of the working class votes for ethnicity and not necessarily their economic self-interest,” Russo said. “It’s hard to get people to admit they’re being racist, but that’s the subtext of this election. People will vote their racial identity and their social values — guns, gays, and God.”