One of the most egregious abuses of the Obama Administration’s auto bailouts was the blatant favoritism evidenced in the treatment of Delphi (General Motors’ parts supplier) retirees. After the Delphi bankruptcy, UAW retirees had their pensions “topped off” by General Motors, apparently with taxpayer money accessed through TARP. While the UAW retirees maintained their pension benefits, non-union, salaried retirees of Delphi lost theirs. There was no logical reason for one group to have their pensions saved while another group lost theirs, just the facts that the distributions were inequitable and the only difference between the groups was that one belonged to a powerful ally of Team Obama and the other did not.
Evidence now surfaces of the Obama Administration rubbing salt in the wounds of the non-politically connected retirees. When the salaried retirees requested help from President Obama to restore their pension benefits, the Department of Labor’s Director of Recovery for Auto Communities and Workers, Jay Williams responded, “Delphi retirees may be eligible for assistance through the Workforce Investment Act Adult and Dislocated Worker Program. The program is designed to provide quality employment and training services to assist eligible individuals in finding and qualifying for meaningful employment and to help employers to find the skilled workers they need to compete and succeed in business.” Essentially, “Don’t like it? Get a job!”
Congressional investigations into the Delphi debacle continue. The Obama Administration, particularly Tim Geithner and Treasury, have been uncooperative releasing information on their involvement. The lack of transparency has led to Ohio Congressman, Michael Turner, introducing a bill called “RESTORE FOIA Act” to require better access to documents that would expose questionable actions in the auto and bank bailouts by the executive branch of government. As currently written, the Freedom of Information Act provides the Executive Branch with exemptions. The bill would only cover information on TARP actions; other exclusions would not be affected.
The Delphi situation is just further evidence that the auto bailouts were designed to protect union interests. President Obama now campaigns on the “success” of the auto bailouts as groups like the non-union Delphi retirees continue to try and make the public aware of the true intention, which was to protect allies of Obama. Taxpayers, GM bondholders, old GM shareholders and non-union retirees sacrificed while the UAW was able to keep their jobs, benefits and now, bonuses. Delphi retirees and I do not begrudge the UAW for receiving fair wages and benefits, it just shouldn’t come at the expense of others.
Congressional investigations should continue and the truth be made known about the auto bailouts that saw non-politically connected classes treated unfairly. If popularity for the auto bailouts decline even further as a result, there is one consolation for President Obama. He can just point to the fact that the auto bailouts were Mitt Romney’s idea.
Mark Modica is an NLPC Associate Fellow.