This week, three of the most influential papers in the country — USA Today, the Washington Post, and the New York Times — published editorials and op-eds arguing that the jury is in:
Federal efforts to salvage the auto industry worked brilliantly, according to their stock-taking. What’s more, they say the laissez-faire free market approach advocated by many Republican presidential candidates simply wouldn’t have worked.
Former Bush speechwriter Michael Gerson, writing in the Washington Post, argues that conservative’s stubborn efforts to stick with a let-the-market-decide approach require “an intentional, determined amnesia.”
No president — Republican or Democrat — would have allowed the economic collapse of the upper Midwest in the midst of a national economic panic. A conservatism that prefers ideology to reality is not particularly conservative.
That view is echoed in the New York Times, in an essay by Steven Rattner, who helped shape the Obama administration’s auto industry bailout.
Rattner — a Wall Street banker, not a socialist — describes GOP narratives about the auto industry as “utter fantasy.”
In late 2008 and early 2009, when G.M. and Chrysler had exhausted their liquidity, every scrap of private capital had fled to the sidelines.I know this because the administration’s auto task force, for which I was the lead adviser, spoke diligently to all conceivable providers of funds, and not one had the slightest interest in financing those companies on any terms. If Mr. Romney disagrees, he should come forward with specific names of willing investors in place of empty rhetoric. I predict that he won’t be able to, because there aren’t any.
In a USA Today lead editorial published today, the paper’s editorial board concludes that Republicans should simply acknowledge that they got this one wrong.
Now the passage of time leaves no doubt that the plan has exceeded expectations. The two companies have returned to profitability. Last year, GM sold more vehicles than any other automaker in the world. The domestic auto industry as a whole has added 207,000 jobs since June 2009.
And the cost to taxpayers has been far less than it would have been had the companies collapsed and the government was forced to partially bail out their pension funds, as well as pay for unemployment benefits and other assistance to displaced workers.
USA Today suggests that this kind of reversal would mirror the change of heart that Mr. Obama experienced regarding the troop surge in Iraq, which the president “belatedly and grudgingly admitted…was working.”
But I think there’s a big difference here.
For many conservatives, there is real danger in the success of big government policies. It’s not just that Mitt Romney or Rick Santorum would have to admit that they got something wrong.
This isn’t a “gotcha” moment or a case of individual stubbornness.
Rather, this is a case where for many conservatives, the short term gain of a salvaged auto industry simply isn’t worth the terrible precedent of a big government program that succeeded.
Rush Limbaugh said it best at the beginning of the Obama administration:
I hope liberalism fails. Liberalism is what’s gotten us dangerously close to the precipice here. Why do I want more of it? We’re talking about my country, the United States of America, my nieces, my nephews, your kids, your grandkids. Why in the world do we want to saddle them with more liberalism and socialism? Why would I want to do that? So I can answer it, four words, “I hope he fails.”
In the particular case of the automobile industry, there is growing factual evidence — and growing popular sentiment — that Mr. Obama and his big government “liberal” policies didn’t fail.
Writing in USA Today, the Heritage Foundation’s James Gattuso laments that fact, arguing that in the grand scheme of things the bailout set a terrible precedent.
But more problematic is the legacy of government interference with private business that the bailout left behind….No one knows precisely what would have happened had policymakers pursued a less interventionist road. But the road that was chosen — putting politicians in the driver’s seat of a major American industry — was the more dangerous. “Successful” or not, it’s no model for the future.
So what do you think? Are there times when free markets and industry need big government to step in and steady the boat? Has the auto bailout story changed your thinking? Or do you see this “victory” as a nose under the tent for liberal policies?