Watchwoman on the Wall

Romney vows quick U.S. exit from GM


At GM’s Monday closing price of $21.11 a share, the government would lose $16 billion on its $49.5 billion bailout.


Washington— Republican Mitt Romney believes President Barack Obama is holding on to the government’s stake in General Motors to avoid an embarrassing financial loss before the election, and says he’d sell the stock quickly if he wins the White House.In a wide-ranging half-hour interview with The Detroit News, the presumptive GOP nominee also said he’d review pending rules that will require automakers to almost double fuel efficiency requirements by 2025, and believes Detroit may need a leadership change in order to fix its nagging financial problems.

As part of the government’s GM bailout, the U.S. Treasury still holds a 26 percent stake in the Detroit automaker, and has been sitting on that share for 35 months.

“There is no reason for the government to continue to hold (its GM stake),” Romney, a Detroit native and son of an auto executive, said Friday.

Obama isn't selling the govmint GM stock, what did you do with ours?

“The president is delaying the sale of the shares to try and avoid the story that the taxpayer took another loss. I would get the company independent from government and run for the interests of the consumer and the enterprise and its workers — not for the political considerations of government officials.”

At GM’s Monday closing price of $21.11 a share, the government would lose $16 billion on its $49.5 billion bailout.

A Treasury spokesman declined comment Monday on Romney’s declaration. But last month, Tim Massad, the assistant Treasury secretary who oversees the GM stake, told The News the government has no timetable for selling its GM stock.

“We have to balance maximizing recovery for the taxpayers with the speed of exit,” he said.

Obama campaign spokesman Matt McGrath said, “The last time Gov. Romney weighed in on the future of the auto industry, it was to suggest that we let Detroit go bankrupt, a betrayal no Michigander is likely soon to forget. As someone who was dead wrong about the industry’s present, Mitt Romney is the last person who should be offering advice about its future.”

“There is no reason for the government to continue to hold (its GM stake),” Romney, a Detroit native and son of an auto executive, said Friday.  And as for electric vehicles, Romney said the government is attempting “to force a market to adopt a technology that people aren’t interested in.”

Romney said the Democrats are “distorting” his record on the auto bailout, whose government-imposed conditions included filing bankruptcy.

“If they needed help coming out of bankruptcy and government support, that was fine, but I was not in favor of the government writing billions of dollars in checks prior to them going into bankruptcy,” he said.

Romney on fuel efficiency

On another issue, Romney said he would reconsider what Obama has called one of his key domestic achievements: nearly doubling fuel-efficiency requirements to 54.5 mpg by 2025.

The Obama administration won the support of most automakers — including Detroit’s Big Three — for the 2017-2025 rules that will cost the industry $157.3 billion and add about $2,000 to the price of an average car. But it will save drivers $1.7 trillion at the pump.

Romney said he’d seek “a better way of encouraging fuel economy” than corporate average fuel efficiency (CAFE) mileage requirements “as the sole or primary vehicle,” he said.

“The best approach is to try and build vehicles that people want, rather than having the government telling the companies what they must make,” he said.

“I would work with the manufacturers to find ways to encourage fuel economy on the part of the consumer. But trying to have the manufacturer push the product on the consumer — that the consumer doesn’t want — is not the right approach.”

And as for electric vehicles, Romney said the government is attempting “to force a market to adopt a technology that people aren’t interested in.”

Weighs in on Detroit

Asked to weigh in on Detroit, Romney said the city may need new leadership to turn around.

“I am convinced that anything is possible in America and I have watched Detroit suffer year after year after year,” he said. “My own experience is if an enterprise of any kind continues to suffer over a long period of time, it is a result in large measure of a failure of leadership, and I am sure prior leaders did their best … but if a leader can’t get things going, it’s time to bring in a new leader.”

Romney said he isn’t prepared to say if the state should play a bigger role, but said someone should be given a chance to remake Detroit.

“A strong leader with a clear vision should be given a shot to turn the city around, and if he or she can’t get the job done, someone else should be given that opportunity,” he said.

A spokeswoman for Bing said the mayor had no comment.

Romney expects to return to Michigan “a great deal, and fighting a campaign to win” the state.

“The people of Michigan recognize that the president’s policies and Gov. (Jennifer) Granholm’s policies did not work to get people back to work and they want to see a different course taken,” Romney said.

Granholm rejected that.

“Gov. Romney obviously hasn’t read a Michigan newspaper lately. President Obama’s intervention saved the auto industry and has made Michigan the comeback story of the country,” she said. “No one will forget that Mitt Romney urged letting Detroit go bankrupt.No one will forget that Romney stabbed his home state in the back in our hour of need.

“And his trickle-down, laissez-faire approach to the economy would take us right back to those dark days.”

By David Shepardson – Detroit News Washington Bureau – From The Detroit News:



Posted by Donna Calvin — Tuesday, June 05, 2012


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