Obama touts success

TOLEDO, Ohio – Facing a cascade of slipping economic signs that could endanger his re-election, President Barack Obama sought to shift attention to an unpopular move he made early in his term that appears to be paying off: bailing out the auto industry.

Obama’s appearance Friday at a Chrysler plant in this politically important state underscored how few economic bright spots he can highlight. New figures Friday showed unemployment rose to 9.1 percent, the second straight month that the jobless rate climbed. Speculation grew that the economy might slip into another recession, which would hurt families nationwide just as the 2012 campaign begins.

Obama’s trip follows a week’s worth of coordinated messages in which administration officials depicted him as being able to make the “gutsy” decisions that should give voters confidence in uncertain times.

They point to the record of the domestic car companies, which have bounced back from their near collapse in 2008-’09. Chrysler last week repaid $7.6 billion in loans to the U.S. and Canada, six years ahead of schedule. In all, the company has returned $10.6 billion of $12.5 billion it received in U.S. aid.

Taxpayers are expected to lose about $14 billion of the $80 billion spent under the Obama and Bush administrations to bail out Chrysler, General Motors and their suppliers. But companies are adding jobs and gaining market share against international competitors.

Standing in front of a row of half-built Jeep Wranglers in Toledo, Obama said that rather than let the carmakers fail or keep them afloat through loans with no strings attached, he demanded that they retool in return for billions in federal aid, and that decision saved a million jobs.

“We said that if everyone involved was willing to take the tough steps and make the painful sacrifices that were needed to become competitive, then we’d invest in your future and the future of communities like Toledo; that we’d have your back,” Obama told a friendly audience of several hundred workers.

Obama acknowledged the broader problem he faces. “Now, I don’t want to pretend like everything is solved,” he said. “We’ve still got a long way to go not just in this industry, but in our economy; for all our friends, all our neighbors who are still feeling the sting of recession.”

Drawing attention to the auto bailout would have been risky at one point. Before the 2010 midterm elections, independent voters disdained bailouts, deficits and stimulus measures.

But Democrats now believe the auto bailout in particular is a way to distinguish themselves from Republicans. They see government intervention as an important tool in protecting both workers and business from the shocks of unfettered markets, and they believe voters buy that argument.

“The naysayers talked about socialism, government takeover and money down a rat hole. Clearly they were wrong,” Sen. Sherrod Brown, D-Ohio, said in an interview after Obama’s speech. “The conservative politicians were almost unanimous against this because they don’t believe government ever has a positive role in anything, and this is a partnership between government and business.”