by Susan J. Aluise | November 7, 2012 1:54 pm
Elephants never forget. Neither, it appears, do voters in Michigan and Ohio. While multiple storylines emerged from Barack Obama’s victory over Mitt Romney on Tuesday, the candidates’ radically different views on the auto industry bailout clearly made a difference in key Midwestern states.
Romney, who slavishly defended his 2008 idea to “let Detroit go bankrupt” in the final presidential debate and on the campaign trail, failed in his bid for the White House after his unpopular stance on the issue cost him his boyhood state of Michigan and the battleground state of Ohio.
Born in Detroit to an auto industry executive who eventually turned around the struggling American Motors Corp. and became governor of Michigan, Romney should have had an edge in the state. However, the rising fortunes of the Detroit Three — General Motors (NYSE:GM), Ford (NYSE:F) and Chrysler (now a unit of Fiat SpA (PINK:FIATY) — dealt a crushing blow to Romney’s hopes.
Here’s why: most Michigan and Ohio voters feel that they’re better off today than they were four years ago because of the very auto industry bailout Romney stridently opposed — and with good reason. In December 2008, there were 462,000 auto industry jobs in Michigan and 256,000 in Ohio, according to the Bureau of Labor Statistics. Massive layoffs cut those payrolls to 241,000 and 147,000, respectively, by January 2009.
But the bailout helped boost auto industry jobs in Michigan to 410,000 by August 2012; auto sector jobs in Ohio have recovered to 199,000. Had GM and Chrysler been allowed to fail as Romney advocated, a total of more than 1 million jobs would have been lost, according to the Center for Automotive Research.
Romney lost most of the voters who benefited from the bailout. In exit polls released by The Associated Press, roughly 60% of Ohio and Michigan voters approved of the auto bailout — and of those, about 75% voted for Obama.
While the 34 electoral votes in those two states alone would not have been enough to deliver the margin of victory for Romney, the issue also energized union voters in Wisconsin and Pennsylvania (with 10 and 20 electoral votes, respectively) — both close races that went for Obama in the end.
Romney should have seen this coming: He had a great preview of how the contentious issue could play out in last February’s Michigan primary, where his unpopular stand on the bailout gave unexpected life to former Pennsylvania Sen. Rick Santorum’s campaign.
Romney stubbornly advanced the argument that he was right on opposing the auto bailout, despite the resurgence in the industry’s fortunes — and the state’s auto-sector job growth. To emphasize his point, he even wrote a new anti-bailout op-ed piece to explain to primary voters why he was right in 2008.
While Romney won that Michigan primary, he failed to learn an all-important political lesson: Trying to convince voters that they’re wrong in believing that the bailout was a good thing — despite evidence that they’re better off because of it — is insulting. And politicians insult voters at their own peril … as Romney learned last night.
Susan J. Aluise is a former White House correspondent who has covered several presidential campaigns. At the time of writing, she had no holdings in the stocks mentioned.
Source URL: http://investorplace.com/investorpolitics/how-the-auto-bailout-lost-mitt-romney-the-white-house/
Short URL: http://investorplace.com/?p=255739
Copyright ©2014 InvestorPlace Media, LLC. All rights reserved. 700 Indian Springs Drive, Lancaster, PA 17601.