In a radio interview conducted last Thursday, President Obama defended his decision to increase loans to Chrysler and GM to $65 billion. The Bush administration extended $17.4 billion to the struggling automakers shortly before turning over the reins of power last winter.
In his sharpest public criticism of the Bush administration’s auto bailout to date, President Obama said, “The auto interventions weren’t started by me. They were started by a conservative Republican administration.”
President Obama went on to say, “The only things that we did was, rather than just write GM and Chrysler a blank check, we said, `You know what? If you’re going to get any more taxpayer money, you’ve got to be accountable.”’
“They went through a record bankruptcy, and now GM for the first time is actually hiring folks back,” Obama said.
Last fall, former president Bush said that the failure of Chrysler and GM would, “leave the next president to confront the demise of a major American industry in his first days in office.” According to both the out-going and incoming administrations, Bush’s move to extend emergency funding to the automakers came only after consultations between the Bush Whitehouse and Obama’s transition team. Both parties agreed to set March deadline for GM and Chrysler to make sweeping changes to their respective operations.
In December, President-elect Obama praised the move and said, “The auto companies must not squander this chance to reform bad management practices and begin the long-term restructuring that is absolutely necessary.”
Apparently shifting blame to the former administration, President Obama said, “The fact that both the auto bailout and the bank bailout were started under a previous, conservative Republican administration indicates the fact that this wasn’t ideological; this was a matter of necessity.”
Responding to criticism by some auto dealers and members of Congress, President Obama said that the Cash for Clunkers program has been, “successful beyond anybody’s imagination.”
Many new car dealers have complained that the U.S. Department of Transportation has been slow to process the billions of dollars worth of applications it has received for reimbursements from dealerships that have participated in the program over the last month. President Obama said, “I understand dealers want to get their money back as soon as possible, but the fact of the matter is, this is a good news story.”
Obama blamed the delays on the sheer volume of applications being submitted, which he said is evidence the program has been a success. “We’re now slight victims of success,” he said, “because the thing happened so quick, there was so much more demand than anybody expected that dealers were overwhelmed with applications.”
He also said that, “there have not been extraordinary delays on the U.S. government’s part,” and assured those dealers who have not yet been reimbursed that they will be paid.
The federal “Cash for Clunkers” program which began last month is scheduled to end on August 24.