In his new book Decision Points, former president George W. Bush reveals some insight into his decision to save GM and Chrysler from going under. Of his decision, he said he “had to safeguard American workers and families from a widespread collapse.”
Bush also reveals that he informed then President-elect Obama of his decision, ahead of his own advisors, and told the current president that he “won”t dump this mess on him.”, and let the automakers fail. Although he says he is ideologically opposed to bailouts – and was opposed to Jimmy Carter”s 1979 bailout of Chrysler, he needed to stop the devastating impact of the potential loss of over 1 million jobs and $150 billion in tax revenues, not to mention the massive blow to the country”s GDP that would have occurred.
He also said that he “believed strongly that government should stay out of the auto business. Yet the economy was extremely fragile and my economic advisers had warned that the immediate bankruptcy of the Big Three could cost more than a million jobs, decrease tax revenues by $150 billion and set back America’s GDP by hundreds of billions of dollars.”
Bush blames the faltering of the auto industry on poor management, as he says American auto execs let costs balloon out of control through high pension programs, and that they were slow to notice and address changes in the market, which led to foreign companies being able to outcompete.
Dubya also mentioned that it pained him to have the auto bailouts as his last major economic decision while in office, but that he had no choice in the matter really.
– By: Stephen Calogera
Source: Detroit News