Romney, born in Detroit and facing a tough Michigan primary Feb. 28, wrote in a commentary published Tuesday in The Detroit News, that his views in a New York Times commentary published last year was that the U.S. auto industry was vital to the country but he favored a "managed bankruptcy" as a way to push the tanking industry forward.
"Managed bankruptcy may sound like a death knell," Romney wrote in The Detroit News commentary. "But in fact, it is a way for a troubled company to restructure itself rapidly, entering and leaving the courtroom sometimes in weeks or months instead of years, and then returning to profitable operation."
The bailout by the Obama administration was "crony capitalism on a grand scale," said Romney, whose father, George Romney, was a Michigan governor and president of American Motors.
"The president tells us that without his intervention things in Detroit would be worse," Romney wrote. "I believe that without his intervention things there would be better."
"The indisputable good news is that Chrysler and General Motors are still in business," Romney wrote. "The equally indisputable bad news is that all the defects in President Obama's management of the American economy are evident in what he did."
Managed bankruptcy is what Chrysler and GM needed, Romney said, because both were weighed down with an accumulation of labor, pension, and real estate costs "that made them unsustainable." By shedding themselves of excess costs and poor management, "they could re-emerge as vibrant and competitive companies."
Romney said the course he recommended eventually was followed, but"something else happened along the way that was truly egregious. Before the companies were allowed to enter and exit bankruptcy, the U.S. government swept in with an $85 billion sweetheart deal disguised as a rescue plan."
The dream of Detroit "is and always has been one of ideas, innovation, enterprise, and opportunity," Romney said. Auto-design visionaries "never envisioned a role for government in their business, but relied on the hard work and commitment of private individuals."
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