Measured success
Intelligencer Journal: In Our View
Published Aug 23, 2010 08:35
Have you noticed that Republicans, critical of nearly everything President Obama has done or wants to do, have become strangely silent about one part of the president's economic plan?

It's the American auto industry.

The billion dollar bailout of General Motors and Chrysler, which likely kept these companies from liquidation and saved tens of thousands of jobs, appears to have worked.

GM is profitable again. It has repaid its government loans and is preparing a public stock offering to begin the process of buying out the large share of stock now held by the federal treasury.

More importantly, after shedding jobs for years, it's hiring again, albeit at lower, but more sustainable, wage rates.

So is Chrysler, long the most wounded of the "Big Three'' American automakers. Now controlled by Fiat, Chrysler is using its strengths in trucks and off-road vehicles to become a world player.

GM and Chrysler, along with Ford, which didn't use a federal bailout, have become very different companies today. They are leaner with fewer factories and lower costs. They are producing vehicles customers want and in the numbers they can sell.

Car sales are relatively strong, and they represent an important part of overall retail sales, which continue to struggle. Without them the economy could well find its way back into recession.

It was a painful and controversial process to get to this point. A lot of workers lost their jobs, not only at car plants, but also at suppliers. Factories closed and some communities continue to struggle.

But can you imagine how much worse things would have been for this industry and the country if the government hadn't stepped in? Would there be any American auto jobs left?

It's a difficult question to answer, but also one we're glad we didn't have to.

The government became the automakers' banker of last resort, not because it wanted to but because it had to. At this point it looks like a wise decision.

For those who continue to criticize other economic moves, such as the Wall Street bailout and stimulus spending, we say: Have patience.

The bailouts were never intended to work overnight, but they are working.
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