Why Mitt Romney Has Turned to Lying About the Auto Bailout

The 2009 rescue of the auto industry is broadly popular in Ohio -- and Republicans never came up with a coherent argument against it.

The latest round of the Auto Bailout Wars began on Friday, when Mitt Romney, campaigning in Defiance, Ohio, told the crowd, "I saw a story today that one of the great manufacturers in this state, Jeep, now owned by the Italians, is thinking of moving all production to China."

It wasn't true, according to Chrysler, the company that owns Jeep and is majority-owned by the Italian automaker Fiat: Romney had apparently misread a confusingly written Bloomberg report (or read an inaccurate summary of it), in which the company talked about making Jeeps in China in addition to the current U.S. operation.

That didn't stop the Romney campaign from making an ad based on the claim and airing it in Ohio, starting Sunday.

Obama, the ad says, "sold Chrysler to Italians who are going to build Jeeps in China." That's technically accurate, but highly misleading, especially given the following line, "Mitt Romney will fight for every American job." That strongly implies that Obama's actions allowed something to happen to American jobs, when, in fact, no U.S. workers would be affected by adding capacity in China and Jeep is in the process of adding more than 1,000 workers in Ohio. That Romney campaign put the ad on the air without issuing a press release about it, and mostly declined to defend it to reporters, implied a certain degree of sheepishness about its claims.

The Obama campaign quickly worked itself into a froth of outrage over the ad. "Flat. Out. False," campaign manager Jim Messina said Monday. "It reeks of desperation because that's what it is." By Monday afternoon, the Obama campaign was out with its own ad responding to Romney's.

The back-and-forth over the ad wasn't just the petty fracas of a late-stage campaign. It illustrated a deeper truth: The auto bailout is helping Obama in Ohio, and Romney has never managed to blunt the president's edge on the issue.

The bailout -- accomplished via executive action in 2009 using funds from the Troubled Asset Relief Program -- was unpopular at the time. But now that the auto companies are thriving, the president often touts it as an example not just of a resurgent economy but of tough decision-making. One poll earlier this month found that 54 percent of Ohioans approved of the auto rescue, while just 37 percent did not -- and 79 percent thought the auto industry was an important issue.

The most obvious evidence that Obama is winning on the auto bailout comes in the way Republicans have fumbled around for a response. As they campaign in Ohio, Romney and his allies have trotted out a variety of counter-arguments, but none has stuck. The result is a hash of convoluted explanations and excuses:

* The bailout wasn't necessary. This is basically Romney's line. Though he famously wrote an op-ed headlined "Let Detroit Go Bankrupt," he was not, as Obama claims, advocating letting the industry fail; he called for the auto companies to be taken through a managed bankruptcy with the aid of private capital. (Even the most dedicated free-marketeers don't generally dare to argue that the auto companies were failing because they couldn't compete and deserved to die.) The major problem with this argument is that there was no such private capital to be had at the time; that's why the companies were begging for federal help.

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Molly Ball is a staff writer covering national politics at The Atlantic.

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