Auto Industry Rebounding, Believe It or Not.

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(Flickr/aldenjewell)

Back in 2008, when Chrysler and GM were facing bankruptcy, conservatives started a campaign against a government bailout. In order to convince people it was a bad idea, they went around telling everyone that autoworkers were lazy and overpaid, trying to make the workers into the villain of the story; the key piece of evidence was the fabricated claim that these workers were paid an average of $72 an hour. It was a lie (the real figure was about $28, or a decidedly middle-class wage), but it did the job; in short order, opposition to the auto bailouts became conservative dogma, and most of the public ended up opposing the bailouts.

While there are a lot of things to criticize about the various economic initiatives the government took in 2008 and 2009, this one seems to have worked out pretty well:

General Motors took the first formal steps on Wednesday to once again sell shares publicly, highlighting a remarkable turnaround for the corporate giant a year after its bankruptcy and setting the stage for Washington to withdraw from its majority ownership stake in the automaker. ...

The public offering of stock -- which is likely to be one of the largest in history and unfold sometime in the fall -- will allow the U.S. government to offload some of its shares, dropping its stake to below 50 percent, according to sources familiar with the offering who spoke on the condition of anonymity because they were not authorized to discuss it publicly. According to the documents, the government will also give up the power to appoint members to GM's board.

This is obviously just one phase of an extended process by which the government will extricate itself from GM, and the company will pay back the money it borrowed from the taxpayer. GM was profitable in the first two quarters of this year, after losing billions the year before. Given that people on the right were recommending that we just let them go out of business, with hundreds of thousands of jobs (maybe millions, when you count all the suppliers and affiliated businesses that depend on the auto industry) lost, this would seem to be a pretty remarkable success story. Not that the administration is going to get much credit for it, though. They would if the larger economy was improving, and "Things are looking up" was the larger story into which this particular story would be fit by the press. But it isn't.

-- Paul Waldman

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