America prides itself in the quality of automobiles it produces and Detroit – known as the motor city – is where that pride originates. But under the strain of the present recession, Detroit and America saw the automobile industry crumble, laying off thousands of people to stay in business and creating inferior products in the process.
The choice was simple – let Detroit go bankrupt, thus eliminating millions of jobs throughout the industry and watching other countries continue to pass us by in the quality and quantity of cars they produce, which by the way, was what Mitt Romney said should have happened when he wrote an opinion piece in the New York Times; or do whatever was reasonably necessary to save millions of jobs and save the industry, and bringing that pride back to America as first in the world for quality car production.
President Obama chose the second option and Detroit, the auto industry and America are seeing the rewards of his action. America once again produces the best automobiles in the world.
Everyone shares in this pride, except Republicans… and Mitt Romney. Today, Romney wrote another piece, reiterating his feeling that Detroit should have went bankrupt.
My view at the time — and I set it out plainly in an op-ed in the New York Times — was that “the American auto industry is vital to our national interest as an employer and as a hub for manufacturing.” Instead of a bailout, I favored “managed bankruptcy” as the way forward.
Managed bankruptcy may sound like a death knell. But in fact, it is a way for a troubled company to restructure itself rapidly, entering and leaving the courtroom sometimes in weeks or months instead of years, and then returning to profitable operation.
In the case of Chrysler and GM, that was precisely what the companies needed.