Obama visiting Detroit auto show as industry flourishes – Fox 2 Detroit

Posted: Wednesday, January 20, 2016

– President Barack Obama will be in town Wednesday in Detroit to tour of the North American International Auto Show.

The tour gives Obama the chance to highlight the industry’s remarkable turnaround over the past seven years, and to remind the public that his administration came to the industry’s rescue at a time when most Americans opposed any further financial assistance for Chrysler and General Motors.

“Critics said it was a `road to socialism’ or a `disaster’ waiting to happen,” Obama said earlier this month. “But I’d make that bet again any day of the week.”

Detroit teachers also planned a massive sick-out on this day to continue their protest of poor working and learning conditions. At last check, nearly 90 schools were closed. The teachers plan to march down to Cobo Center, where the President plans to visit the NAIAS.

At the same time, Obama is taking steps to make it clear he’s not ignoring the water problems in nearby Flint, Mich.

The president signed a federal emergency declaration over the weekend that allows up to $5 million in assistance and requires a 25 percent match in funding from the state. The White House also said it had appointed a Health and Human Services official to coordinate federal help provided to local responders and the state.

The crisis began in 2014 when a state-appointed emergency manager switched Flint from Detroit water to Flint River water to save money. The corrosive water caused lead to leach from old pipes. Flint returned to the Detroit system in October after elevated lead levels were discovered in children.

White House spokesman Josh Earnest said he didn’t expect the president to make a detour in Flint, but the White House noted that Obama did meet with Flint Mayor Karen Weaver when she visited Washington Tuesday, saying he “heard firsthand how the residents of Flint are dealing with the ongoing public health crisis, and the challenges that still exist for the city, its residents, and the business community.”

The White House said that Obama reiterated to Weaver that his administration will continue to support state and local officials in their response.

As to the auto industry, the U.S. treasury invested about $80 billion in it during the last recession. After counting loan repayments, dividends and stock sales, the federal government recovered $70.5 billion.

Obama can’t take all of the credit for the government’s help. President George W. Bush initiated the auto bailout with more than $17 billion in short-term loans. Under ordinary circumstances, Bush said he wouldn’t have favored intervening to prevent auto makers from going out of business, but in the midst of a financial crisis and recession, allowing the industry to collapse would send the country into a deeper and longer recession.

The Obama administration also provided additional capital to help Chrysler and G.M. continue operating as they restructured operations prior to and during a Chapter 11 bankruptcy proceeding. The companies shuttered plants, laid-off workers and cut ties with thousands of dealerships.

Most Americans opposed providing a second round of government aid. A Gallup poll from February 2009 showed that about 58 percent opposed giving aid to automakers in danger of going bankrupt. Only about 41 percent supported the aid.

Even three years later as Americans looked back, a slight majority said they disapproved of the bailout, with Republicans opposing it by a 3-to-1 margin, Gallup said.

The auto show in Detroit is taking place as the industry enjoys record sales. Americans purchased nearly 17.5 million vehicles last year.

Automakers use the show to unveil new products and technology. The show drew more than 200,000 visitors on its opening weekend for the public and manufacturers introduced 55 vehicles.

After his visit to the auto show, we’re told the President will head to the UAW GM Center to talk about the turnaround of the auto industry.

This is a developing story. Stay with FOX 2 for live coverage throughout the morning of today’s events, including the president’s arrival, the protests and the president’s remarks at the UAW-GM Center. Check back with our livestream at www.fox2detroit.com/live for coverage.

The Associated Press contributed to this report.


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