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Ohio Governor John Kasich told me the auto bailout hadn't added all that many new jobs. The auto companies were consolidating workers, closing down old plants and moving them to places like Lordstown, he said. Ohio's economy is growing, Kasich claimed, because he had been aggressive in luring medical, insurance and banking jobs to the state. Kasich was right, but also wrong: Ohio's economy would have collapsed but for the bailout. There were innumerable jobs in auto-parts manufacturing companies, and the stores and saloons that serve those factories, that simply wouldn't exist now if the bailout hadn't occurred. Tax revenue would have plummeted, which would have made it impossible for Kasich to balance the budget and cut taxes.
The public reaction to the auto bailout in Ohio and Michigan should be instructive to both Romney and Obama. You could argue that the federal bank bailout accomplished many of the same results on the national level--it prevented an economic collapse. But people don't see it that way. "That bank bailout only helped the bankers line their pockets," said Katie Bunkers, a nurse in Toledo. "At least we got something out of the auto bailout." And that is where the challenge lies for Obama and the Democrats in general. It's been a long time since middle-class Americans saw government act on their behalf. They suspect it does most of its business with the rich and poor. That isn't true, of course. But those, like the President, who favor government action to solve our problems have to explain to people like Katie Bunkers, in the clearest possible terms, how ginormous, complicated pieces of legislation like economic stimulus and financial reform will benefit them.
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