In the new memoir “Decision Points,” former U.S. President George W. Bush stands behind his decision toward the tail end of his presidency to extend a $17.4 billion auto bailout. Automotive News reports that President Bush knew just four days after GM announced it was near bankruptcy – on Nov. 11, 2008 – that he would have to bail out both Chrysler and General Motors. Mr. Bush says he made the “too big to fail” decision earlier that most people realize, and that he told then President-elect Barack Obama of his decision before even the president’s advisers knew.
The ‘Decision Points’ in saving America from collapse
President Bush writes in “Decision Points” that saving American workers and families from economic collapse were important factors in his auto bailout decision. He also claims he considered what he’d be passing on to the Obama administration. The auto bailout package that was put into effect was actually less than what Bush favored, writes Automotive News. He’d wanted a $25 billion plan, but Senate Republicans balked at the price. In order to make the $17.4 billion version to work, President Bush diverted money from TARP that had been intended for Wall Street.
Poor industry management forced the president’s hand
In the automotive chapter of “Decision Points,” Mr. Bush bemoans “decades of poor management” on behalf of the automotive industry. This mismanagement “saddled automakers with enormous health-care and pension costs.” Couple that with a general unresponsiveness to changes in the global automotive industry and American automakers found themselves on the outside looking in as foreign manufacturers captured greater market share.
GM wanted a bailout first, but Bush said no
Then General Motors CEO Rick Wagoner approached President Bush about obtaining bailout money, but Bush said no at first. It was only later that George Bush reversed his stance. He says in “Decision Points” that his path of action became clear when he began to understand just what automaker bankruptcies would do to the American economy.
“My economic advisers had warned that the immediate bankruptcy of the Big Three could cost more than a million jobs, decrease tax revenues by $150 billion and set back American’s GDP by hundreds of billions of dollars,” the former president writes in his memoir.