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Wed July 18, 2012
Let Detroit go bankrupt: The famous line Romney never said
The four most famous words that Mitt Romney never wrote are, “Let Detroit Go Bankrupt.”
You read that right. Mitt Romney never wrote those words. They were the headline of a New York Times op-ed column that was authored by Romney and published in the newspaper on November 18, 2008.
I doubt that most people could accurately recite so much as a sentence of the op-ed that Governor Romney actually wrote in that column. All that anybody remembers is the headline, which I have discovered was written by a New York Times editor, not Governor Romney.
Early this year, when Michigan was gearing up for its early presidential primary, there was a popular notion that a narrow win for Rick Santorum might actually end the Romney campaign. At that time, I predicted that the old headline from 2008 might be raised as an attack on Romney. And so it was, although the cash-strapped Santorum campaign was not the driver of the attack ads. Santorum’s campaign was nearly out of money. So it was the Obama-supporting Super PAC “Priorities USA” that attacked Romney, hoping to swing the outcome to Santorum. The Detroit television market in particular got a load of the Priorities USA ads in the last few days before voting occurred on February 28.
Expecting the attack, I sent an inquiry to Arthur Brisbane, the Times’ Public Editor, asking him whether the Romney op-ed column had come with its own headline, or if it had been a Times editorial page staffer who had written the headline. Several days passed, and I was assured in the interim that the Times was looking into my inquiry. That gave me the distinct impression that previously, no one had ever asked the Times about the origin of the headline.
When the Times did get back to me, the answer was unequivocal. Yes, they indicated, a Times editor had written the headline. No, it was not a headline that Romney had suggested. And no, they did not have a record of which editor may have written it, so no particular comment on it could be provided.
The headline is oddly comparable to another famously inaccurate New York newspaper headline. On October 30, 1975, in the midst of the New York City financial crisis that almost forced that city government into bankruptcy, the New York Daily News ran a front-page headline, “Ford to City: Drop Dead.” President Gerald R. Ford, the target of the headline, never suggested that New York “drop dead;” the words never passed his lips. But it damaged him terribly in the 1976 election won by Jimmy Carter, even though he relented and the Ford Administration helped bail out New York City in the end. It is hard for me to imagine that the Times editors were not thinking of the Daily News headline when they wrote, “Let Detroit Go Bankrupt.” But there is apparently no one at the Times whom we can ask about it.
So let’s return to what Mitt Romney really did say in his op-ed, knowing that he didn’t say, “Let Detroit go bankrupt,” and knowing that under fifty years of one-party big-D Democratic rule, the City of Detroit has taken itself to the brink of a municipal bankruptcy.
Here’s what Mitt Romney did say, in November of 2008.
The first thing Mitt Romney declared was that he loved cars, American cars. He said, “The American auto industry is vital to our national interest as an employer and as a hub for manufacturing.”
He suggested all-new management for the failing automakers, and he said that Washington – and the taxpayers – ought not to give company shareholders and bondholders a free pass. “They bet on management and they lost,” Romney said, not sounding very much at all like a friend to any "vulture capitalists."
Romney suggested his own father’s history of success in turning around American Motors, where George Romney cut his pay and that of his executive team, buying stock in the company and going out to the factories to talk to workers directly.
But the really critical advice from Mitt Romney in November of 2008 was the part about which he was right and about which almost everybody else was wrong at the time. Mitt Romney suggested reorganization through a managed bankruptcy.
There’s been a lot of rewritten history since then. I know that the one criticism of Romney’s indisputably correct prescription for General Motors is that in November of 2008, Romney was suggesting federal loan guarantees to finance a reorganization, and in fact when the Obama Administration followed the path of a managed bankruptcy, they used TARP funding. Romney, they say, is wrong inasmuch as no private capital was available in 2009-10, and so the federal “bailout” was needed.
It is a preposterous criticism, one which I hope candidate Romney will push back.
Because when Mitt Romney was advising a managed bankruptcy, Michigan Democrats were not debating about the funding of such a process. They were telling themselves, and auto workers and the federal government, and the world, that no automaker could ever survive a bankruptcy. Governor Jennifer Granholm stood before reporters with UAW President Ron Gettlefinger and then-CEO Rick Wagoner. She looked them all in the eye and declared that bankruptcy for an automaker was not a possibility. Wagoner knew better; he had already considered the option, but he also had no idea about funding the process and he thought it would have be corporate suicide to suggest it. But Wagoner stood with Granholm and nodded in agreement with her political posturing because she would be his link to the newly-elected Obama Administration and the rest of the federal government.
In 2008, you see, when Mitt Romney was 99 percent right about a managed bankruptcy to restart General Motors, Jennifer Granholm and the Democrats were 99 percent wrong.
Charles Brown is an attorney from Livonia. His views are his own and do not necessarily reflect those of Michigan Radio, its management, or its license holder, the University of Michigan.