The White House’s top manufacturing advisor said Michigan’s auto industry is on the mend and doing better than expected.

“We see both of these companies moving forward,” said Ron Bloom, President Barack Obama’s senior counselor for manufacturing policy. “I think the preliminary view right now is they’ve learned the lessons of a near-death experience.”

Bloom said the decision to use $62 billion to keep General Motors and Chrysler from liquidating was “a very tough decision politically” for the White House, but said Michigan would be in worse economic condition today if they hadn’t been saved.

“If these companies had liquidated — do not pass ‘go,’ do not collect $200 — their entire supply base would’ve collapsed,” Bloom said.

At the Michigan Manufacturers Association meeting, Bloom defended GM’s repayment of its government loans. He rejected the torrent of criticism about GM’s decision to tout its repayment of its $6.7 billion in government loans with unused government funds.

“The money GM used to pay down the loans was originally intended to help the company get back on its feet, to help fund its turnaround. But the results of the restructuring have been much better than anybody expected; GM doesn’t need the money, so it’s using it to pay off its debt,” Bloom said.

Several Republicans have criticized GM, noting taxpayers are still on the hook for about $43 billion of the $50 billion GM bailout. Taxpayers swapped that for a 61 percent majority stake in GM.

One conservative group has filed a complaint with the Federal Trade Commission, complaining GM aired misleading ads touting its repayment. GM has defended the ads, which have stopped running.

“No one is declaring ‘mission accomplished,’ but (GM is) clearly moving in the right direction,” Bloom said. “We leave the management to the management and we plan on disposing of our ownership stake as soon as practicable.”

Though American automakers benefitted from last year’s popular “cash for clunkers” program ( http://www.cashforclunkers.org/ )that gave buyers $4,500 to trade in older, less fuel efficient vehicles for newer, more eco-friendly models, Bloom said he doesn’t foresee another such program in the future.

Stabenow said that in working with her colleagues on Capitol Hill, she’s seeing a shift in attitude toward the controversial bailout of the auto companies.

“People are starting to realize there’s a difference between the banks and the auto companies,” she said. “(GM and Chrysler) were victims of the financial crisis. They didn’t cause the financial crisis.”
Source: The Detroit News: http://www.detnews.com