Amid the controversy over Chrysler’s “It’s Halftime In America” Super Bowl commercial, a glaring question remains: if Chrysler is back on top and so strong, then why hasn’t it repaid taxpayers the $1.3 billion it still owes them?
“I was, frankly, offended by it,” said Republican strategist Karl Rove. “I’m a huge fan of Clint Eastwood, I thought it was an extremely well-done ad, but it is a sign of what happens when you have Chicago-style politics, and the president of the United States and his political minions are, in essence, using our tax dollars to buy corporate advertising.”
Already, Democrats have begun co-opting the “It’s Halftime In America” meme, and President Barack Obama’s campaign team has already signaled that “saving” Detroit and the American auto industry will be a central campaign theme in Mr. Obama’s 2012 reelection bid. Indeed, in June 2011, Mr. Obama proudly declared:
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. And this week, we reached a deal to sell our remaining stake. That means Chrysler will be 100 percent in private hands.
The Washington Post fact checker, however, disagreed–strongly.
We take no view on whether the administration’s efforts on behalf of the automobile industry were a good or bad thing; that’s a matter for the editorial pages and eventually the historians. But we are interested in the facts the president cited to make his case.
What we found is one of the most misleading collections of assertions we have seen in a short presidential speech. Virtually every claim by the president regarding the auto industry needs an asterisk, just like the fine print in that too-good-to-be-true car loan.
At issue was the slippery language Mr. Obama used to calculate Chrysler’s repayment of its taxpayer-funded bailout. Mr. Obama’s numbers were based off of the $8.5 billion the federal government loaned Chrysler while he was in office and did not include the government’s prior $4 billion loan extended in the last month of President George W. Bush’s presidency, for a total bailout of $12.5 billion paid for by taxpayers. Therefore, even after the $11.2 billion the Obama Administration says it received from Chrysler, taxpayers are still left holding the bill for $1.3 billion.
Indeed, in a startling statement, Treasury Secretary Tim Geithner conceded that, yes, taxpayers would never recoup the $1.3 billion, but that the decision was nonetheless wise:
We did this to save jobs. The biggest impact was in the jobs saved and the wealth preserved. We’ll get everything we can to maximize the gain and minimize the loss. We are going to lose money on the auto industry but our job is to protect the country.
Still, Mr. Geithner hailed the taxpayer boondoggle a tremendous success:
As Treasury exits its investment in Chrysler, it’s clear that President Obama’s decision to stand behind and restructure this company was the right one. Today, America’s automakers are mounting one of the most improbable turnarounds in recent history – creating new jobs and making new investments in communities across our country.
At the time, Mr. Eastwood himself criticized the automobile bailout:
We shouldn’t be bailing out the banks and car companies. If a CEO can’t figure out how to make his company profitable, then he shouldn’t be the CEO.
As for Mr. Eastwood’s compensation for the ad, Mr. Eastwood claims that “anything they gave me for it went to charity.” Chrysler has not released figures on the total costs to design, shoot, and air the two-minute spot. However, 30-second commercials reportedly cost $3.5 million.
Mr. Eastwood also says he is “certainly not affiliated with Mr. Obama.”
However, critics are left to wonder: how could a company who has yet to repay taxpayers the $1.3 billion it loaned them afford such a lavish advertising campaign? And if, indeed, Chrysler is back on top, then why hasn’t it volunteered to repay Americans the money it still owes them?
After all, as the commercial says, “It’s halftime in America, too. People are out of work and they’re hurting. And they’re all wondering what they’re going to do to make a comeback. And we’re all scared, because this isn’t a game.”
So when can taxpayers expect Chrysler to cut them that $1.3 billion it owes them? After all, isn’t that the right thing to do?