Romney takes heat over stance on auto industry bailout

In November 2008, Romney publicly opposed a request by auto executives for billions in government loans to ease a recession-driven crisis. Romney preferred a structured bankruptcy for automobile manufacturers, the mainstay of Michigan’s economy, saying the carmakers needed a transformation, not a handout.

Responding to Holtz outside the diner yesterday, Romney said: “I know there are some people who believe in bailouts. I believe in following the process of the law, which is bankruptcy.’’

“But you were wrong!’’ Holtz replied. “It worked!’’

Later, at a press conference in Detroit, Romney faced pointed questions about the bailout in a sometimes testy exchange with reporters.

“You get to ask the questions you like, I get to give the answers I like,’’ he said to a television reporter. He continued trying to differentiate between his opposition to lending the industry government money and his support for a managed bankruptcy.

George W. Bush extended $17 billion in emergency loans to automakers in December 2008 as his presidency was drawing to a close. President Obama in early 2009 steered tens of billions more to General Motors and Chrysler, expanding the bailouts as the two giants headed for government-supported bankruptcies. More than $40 billion out of $80 billion in total loans to the industry remain outstanding, and about $14 billion in taxpayer money may never be recovered, according to the White House, far less than first expected.

Now Obama is taking credit for successfully managing the crisis, a narrative that is creating a challenge for Romney on the campaign trail. The former Massachusetts governor, whose father, George, ran American Motors before he served as Michigan’s governor, outlined his position against auto bailouts in a New York Times opinion column in November 2008 with the headline, “Let Detroit go Bankrupt.’’