At Most, Half a Pinocchio

June 7th, 2011 at 10:00 pm

The WaPo fact checker veered into heavy traffic today with a deeply misleading attack on statements recently made by President Obama about the benefits of the auto bailout.

As I note below, you could object to the President’s emphasis on one point if you want to be churlish about it, but big picture: this restructuring has been a pretty dramatic success so far (disclosure: I was a member of the White House Autos Taskforce).

But there’s simply no way you could call this “…one of the most misleading collections of assertions we have seen in a short presidential speech”  (the Post gave the President’s statements three Pinocchios, with four being the worst score).

First, the Post objects to the President’s claim that “Chrysler has repaid every dime and more of what it owes American taxpayers for their support during my presidency — and it repaid that money six years ahead of schedule.”

Chrysler borrowed $8.5 billion from the Obama Treasury and $4 billion from the Bush Treasury.  So far, they’ve paid back $10.6 billion.  The Post objects to the “during my presidency” part, since that omits the part of the loan made during Bush.

OK, I could see where he could have added, “and half of what was borrowed under the previous administration” or something.  But what the Pres said is true, and not nearly as egregious as that “most misleading collection…” asserts.

And for the record, were it not for the President’s decision to help Chrysler, Bush’s $4 billion would almost certainly have been lost.  Simply put, his decision saved Chrysler from liquidation.

Half a Pinocchio, tops.

The other stuff, the Pres got right and the Post just got wrong.

The car company will be in private hands once Fiat buys its full US stake.  Yes, the UAW and their VEBA—the auto union and the independent trust it set up—will own 46%, but these are private, non-governmental institutions.

The shifts added, the jobs retained and rehired, all looked accurate to me.  The Post seemed to object that the President was including jobs at suppliers, which is not only accurate, it’s essential.  The bailout saved more supplier jobs than direct jobs at the factories, a function of all the spinning off of these functions over the last few decades in the industry (parts that used to be made in the final assembly plants are now sourced from outside).  When we were working on this back in the day, many of us viewed the preservation of the supply chains as a critical reason for the intervention.

I hope my blog and public comments show that I am no mindless defender of the Obama economics record, even when my own fingerprints are on the evidence.  And fact checking by the media is an important way to learn what works and what doesn’t.  Unfortunately, such a skewed evaluation as this does more harm than good.


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3 comments in reply to "At Most, Half a Pinocchio"

  1. Ebenezer Scrooge says:

    Doncha know? The WaPo must award an equal number of Pinocchios to each party. It’s WaPo affirmative action!

  2. Michael says:

    “Opinions on shape of earth differ.”

  3. Lex says:

    Having spent 25 years as a journalist (and having been a Republican since 1978), I found Kessler’s piece deplorable [I’d link but it looks like you don’t permit that), although on the Post’s scale, I think either 1 or 2 Pinocchios would have been appropriate — more than the 1/2 you award, but Kessler’s 3 is just loony tunes.

    Were I a Democrat — either a member of the administration or a congresscritter running for re-election next year, particularly in an auto-heavy district, I could frame the same facts the president used in the following way with an absolutely clear conscience:

    “We loaned Chrysler $12.3 billion total during the current administration and President Bush’s. Yeah, we may have to write off about 12% of that. But we saved hundreds of thousands of jobs in the Big Three auto makers and their suppliers. I’d do that deal again in a heartbeat. [Optional add end that may or may not be true because I haven’t checked yet but likely would draw loud applause if true: And not one dime of that money went to the investment bankers.]”