A quick quiz for you politics wonks out there.One of the big Republican talking points in recent months has been about how the Obama Administration has squandered vast pots of taxpayer money investing in clean energy.
So, it must have been Obama who said the following a few years back, right?
I believe the federal government should invest substantially more in basic research — on new energy sources, fuel-economy technology, materials science and the like — that will ultimately benefit the automotive industry, along with many others. I believe Washington should raise energy research spending to $20 billion a year, from the $4 billion that is spent today. The research could be done at universities, at research labs and even through public-private collaboration.
That’s exactly what Obama would want to do–invest in crazy new energy sources and fuel economy instead of drilling, baby, drilling and getting gas prices back down to $2 a gallon. So that must have been him who said that.
It was Romney.
By the way, in the debate last night, the candidates almost got into a fistfight over what, exactly, Romney proposed to do about the car companies. And this question is critical, because Romney’s advocacy of a managed bankruptcy is one of the reasons Obama has held a solid lead in the key battleground state of Ohio all year.
So, what was the answer? What did Romney propose in this op-ed?
He proposed a “managed bankruptcy” in which the government provided guarantees on post-bankruptcy financing, but not an actual check:
It is not wrong to ask for government help, but the automakers should come up with a win-win proposition. I believe the federal government should invest substantially more in basic research… The federal government should also rectify the imbedded tax penalties that favour foreign carmakers…The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.
That’s different than what the government actually provided during the auto bailout, which was a managed bankruptcy with the government providing direct financing (loans). Romney explicitly argued against the latter:
In a managed bankruptcy, the federal government would propel newly competitive and viable automakers, rather than seal their fate with a bailout check.
In other words, Romney’s position on helping the car companies was not as extreme as it has since been made out to be. But it also wasn’t as direct an approach as the Obama Administration’s was. And in the financing environment at the time (financial crisis), it is highly unlikely that any private lender could or would have come up with the tens of billions of dollars necessary to lend to the car companies to get them through a managed bankruptcy. So Romney’s “hands-off” recommendation here probably would have failed.
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