Shuttered GM plant finds itself in political spotlight

By Nathan Bomey, Detroit Free Press
Posted Aug. 30, 2012, at 8:54 p.m.

DETROIT — The shuttering of an outdated General Motors plant in Janesville, Wis., more than three years ago was a business decision aimed at helping the then-crumpling automaker return to financial viability.

Now, the 4.8 million-square-foot plant is stuck in the middle of a national political squabble.

U.S. Rep. Paul Ryan, the Republicans’ nominee for vice president, portrayed the plant’s closure in his hometown as a reflection of President Barack Obama’s failures.

As evidence, Ryan cited a February 2008 speech in Janesville, where Obama suggested that U.S. aid for the auto industry could save the plant “for another hundred years.”

“Well, as it turned out, that plant didn’t last another year,” Ryan said Wednesday night at the Republican National Convention in Tampa. “It is locked up and empty to this day. And that’s how it is in so many towns today, where the recovery that was promised is nowhere in sight.”

It was another reminder of how both parties have politicized General Motors’ story — its collapse and its recovery — for their own benefit. The Detroit Free Press reported Sunday that GM, seeking to avoid the political spotlight, has banned political candidates from its plant at least until after the Nov. 6 election.

Ryan is drawing heat from critics who say he distorted the plant’s back story.

Here’s what Obama told the Janesville crowd in February 2008: “I know that General Motors received some bad news yesterday, and I know how hard your governor has fought to keep jobs in this plant. But I also know how much progress you’ve made — how many hybrids and fuel-efficient vehicles you’re churning out. And I believe that if our government is there to support you, and give you the assistance you need to retool and make this transition, that this plant will be here for another hundred years.”

Here’s what happened: GM announced in June 2008 — five months before the presidential election — that it would close the plant. The automaker was still a year away from bankruptcy. The plant produced its last GM vehicle, the sport utility Chevrolet Tahoe, on Dec. 23, 2008, about a month before Obama took office, displacing more than 1,300 workers.

“Again, Ryan blames Obama for a GM plant that closed under Bush,” Obama campaign adviser David Axelrod tweeted Wednesday night. “But then, they did say they wouldn’t ‘let fact checkers get in the way.’ ”

At the time of the plant’s closure, analysts described it as a necessary decision to improve GM’s finances. The company was burning cash, facing an imploding economy and a shrinking credit market.

GM still owns the property, which is on “standby.” That means it could theoretically be reopened at some point, although it’s far from the I-75 corridor that attracts many automakers for its smooth logistics.

“Janesville remains idled,” GM spokesman Greg Martin said. “It was idled in 2008 and it remains idled today.”

After the final Tahoe was produced, a few dozen workers stuck around for six months to assemble trucks in a partnership GM had with Japanese automaker Isuzu. The plant officially stopped all production in June 2009.

GM, which received $19.4 billion in emergency loans from President George W. Bush in late 2010, filed for Chapter 11 bankruptcy on June 1, 2009, with a fresh influx of $30.1 billion from Obama.

In bankruptcy, GM cut thousands of jobs, dozens of properties, billions in debt and billions in bond obligations. GOP presidential nominee Mitt Romney has criticized the GM bailout, saying Obama delivered a “sweetheart deal” to the United Auto Workers union.

But Obama has repeatedly cited the auto industry’s recovery as an example of his successful leadership. He often claims to have “saved” the industry and repeatedly says, “GM is No. 1.”

Obama will get his chance to tell his side of the story next week at the Democratic National Convention in Charlotte, N.C. But his union supporters are already jumping to his defense.

“When Wisconsin needed him most, Paul Ryan turned his back on us, repeatedly voting against legislation aimed at helping displaced workers,” said Ron McInroy, director of UAW Region 4, which covers Wisconsin, in a statement.

Today, the Janesville plant sits as a reminder of GM’s incredible girth in times gone by. The facility, which is located two miles from Ryan’s home in the tree-lined Courthouse Hill neighborhood in Janesville, produced its first Chevy in 1923.

In summer 2009, GM briefly reconsidered plans to close the plant before deciding to produce a new small car at its 4.3 million-square-foot Orion Township plant, where the Chevy Sonic and Buick Verano are produced today.

During UAW contract talks in 2011, the union pushed GM to consider reviving three plants that had been idled or were set to be idled: Janesville, Springhill, Tenn., and Shreveport, La. The automaker chose to reopen the Springhill plant, which analysts always viewed as the most valuable of the three.

Even some Wisconsinites have long doubted whether the Janesville plant will ever be reopened.

Before Bush provided funds to GM in December 2008, then-Wisconsin Gov. Jim Doyle said the Janesville plant would have “no chance” of reopening without a bailout.

Even with a bailout, he said, it would have “a very, very remote chance.”

©2012 Detroit Free Press

http://bangordailynews.com/2012/08/30/news/nation/shuttered-gm-plant-finds-itself-in-political-spotlight/ printed on September 20, 2014