John McCain was never noted for being much of an economic analyst. During the 2008 election campaign he famously noted, to the delight of the press, that “the fundamentals of the American economy are strong.” Now the Senator predicts the demise of Chrysler.
“It was all about the unions. The unions didn’t want to have their very generous contracts renegotiated so we put $80 billion into both General Motors and Chrysler, and [if] anybody believes that Chrysler is going to survive, I’d like to meet them,” McCain told The Detroit News.
The Detroit News claims that McCain “clarified” his remark by saying that he meant “any objective observer.” Does he put himself in that category? Rep. Gary Peters, from Chrysler’s Auburn Hills district, has offered to meet with the Senator who, he said, was not only predicting the company’s failure but “rooting for it.”
Now, everyone knows that Chrysler is on the crux of success or failure, and nobody is happy that the government invested some $15 billion which may go down the tubes. But what is served here by another stupid McCain outburst of straight talk?
And then we have a piece today in AutoSpies which quotes the good ol’ boys at the National Taxpayers Union:
“Every time someone in your neighborhood drives home in a shiny new Chevy Silverado, remember that it cost American taxpayers more than $12,000,” said Pete Sepp, NTU Vice President for Policy and Communications. “Between this and GM’s plan to payback their bailout debt with other taxpayer funds, I wonder if all those Americans without work right now could think of any better ways to spend that money. This is a play out of the Bernie Madoff ponzi scheme playbook, and would be the equivalent of paying your Master Card bill with your Visa.”
Mr. Sepp’s comments were made a propos an NTU publication, “The Auto Bailout—A Taxpayer Quagmire,” by Thomas D. Hopkins, which laments the enormous cost of the bailouts, in particular the GMAC subsidy. Like all such critics, Mr. Hopkins doesn’t offer much of an alternative for the government’s actions last spring. He is right, however, about the need for an exit plan and real transparency. The rest of his piece is politics masquerading as economic analysis.
Mr. Sepp seems to say that the $12,000 should go to unemployed Americans rather than purchasers of new GM vehicles. I guess that means he prefers the dole to revitalizing an industry. The auto industry bailout is nobody’s success story, but that doesn’t mean one should hope for its failure.
I really can’t find any justification for Senator McCain’s remark. Can you?