President Obama’s announcement of a set of conditions for Detroit automakers to receive additional Federal aid dominates front pages across the country, and led cable shows and all three network newscasts last night. While the coverage included negative reactions to the Obama’s words including Wall Street’s selloff and charges that he is being tougher on Detroit auto workers than on banking executives the President himself was credited, particularly on network TV, with taking a decisive stance on behalf of US taxpayers. The CBS Evening News, for example, led its broadcast saying, “With all the anger across the country about taxpayer bailouts…Obama stood up to the auto companies today and said firmly, ‘you’re not getting another one, not unless you come up with a better plan for restructuring your companies.’”
To some analysts, yesterday’s move may end up as one of the most significant in Obama’s entire presidency. On NBC Nightly News, Chuck Todd said, “It’s Reagan and firing those air traffic controllers. It’s Truman and the railroads. This is a big moment, pivotal moment.”
Yesterday, Obama also granted an interview to WJBK-TV Detroit, in which he said that “the most important thing we can do is to make sure the auto industry comes out of this difficult process stronger than ever and able to compete, and that’s going to be our top priority.” Asked if that goal could be achieved without a bankruptcy process, Obama answered, “What I’ve said is that I’m confident we can do this…but I think that we are going to have to find some legal tools if all the parties can’t come together to make some of the accommodations and deal with the enormous debt burdens that both Chrysler and GM are dealing with.” Obama added that he wanted affected workers in the auto industry to know “they’ve got a President who is thinking about them every single day. They are my highest priority in this whole process.”
The Detroit Free Press reports Obama “made clear that the limits of federal aid to automakers was within sight, and that deeper cuts among workers, dealers, creditors and suppliers, along with a possible trip through bankruptcy court, would be needed for the automakers’ survival.” The Detroit News notes the President “sought to reassure consumers and workers that bankruptcy, if required, would be brief.”
The CBS Evening News reported “the rejection of the GM and Chrysler restructuring plans helped send stock prices sharply lower today. The Dow plunged more than 250 points. The NASDAQ lost 43.” On ABC World News, George Stephanopoulos said, “Bankruptcy is very much on the table right now and Administration officials tell me it’s likely the leading option.”
The Washington Post reports “the president’s aggressive move against GM has left some banking executives wondering whether they are next in line.” The Politico reports that under Wagoner, “General Motors and its political action committee gave twice as much to Republicans as they did to Democrats.” From 2000, “when Wagoner took over…through the end of last year, GM and its PAC contributed $1.7 million to Republican candidates and committees, compared only $815,000 to Democratic ones.”
