Is Mitt Romney taking Michigan for a ride?

The presidential hopeful crusades for the auto industry of yore -- and looks awfully out of touch with Michigan's economic pain.

By Edward McClelland

Read more: Republican Party, Politics, News, Economy, General Motors, Oil, Michigan, 2008 election, Mitt Romney

Jan. 15, 2008 | SOUTHFIELD, Mich. -- Remember the Nash Rambler, the convertible that took so many families on cross-country vacations in the 1950s and '60s? Mitt Romney remembers. In fact, he owns one. The car was produced by the American Motor Co. back when Romney's father, George, was its president.

Last year, when Romney turned 60, his own sons chipped in to buy him a '62 Rambler. "That was the kind of car I drove in high school," he reminisced before a crowd of suburban voters on Sunday. "You marvel at how much cars have changed. Great big steering wheel. There are no seat belts."

Romney should have made the Rambler his official campaign vehicle, because he's been pitching himself to Michiganders as the man who'll bring back the state's glory days, when every car bore an American nameplate, and an auto executive could say, "What's good for General Motors is good for the country, and vice versa." Back then, Washington didn't hassle the automakers with burdensome mandates for stuff like seat belts. Or higher gas mileage.

All week, Romney and John McCain have been feuding over whether the auto industry represents Michigan's past, or its future. On Saturday, at a town hall meeting in blue-collar Warren, McCain gave his supporters some of his straight talk, telling them, "The jobs that are leaving the state of Michigan have left and are not coming back. We're going to try to create new jobs."

To replace the old lifestyle of building internal combustion engines, McCain proposed research in hybrid motors, battery-powered cars and hydrogen fuel cells. He also wants to open job retraining centers in the state's community colleges. "Our future is ahead of us in Michigan," he said. "Let's not look back. Let's look forward. We'll restore Michigan back to its preeminent place in America and the world."

To Romney, McCain's approach isn't futurism, it's pessimism. In Southfield, he had a one-word retort: "Baloney."

"I hear people say, 'It's gone, those jobs are gone, transportation's gone, it's not coming back,'" he said. "I'm going to fight for every single job. I'm going to rebuild the industry. I'm going to take burdens off the back of the auto industry."

Romney criticized federal fuel efficiency standards -- passed last year over the objection of Michigan's congressional delegation -- which require cars and light trucks to average 35 miles per gallon by 2020. He's also been slamming McCain for supporting a tax on energy companies that exceed certain levels of carbon dioxide emissions.

At a speech to the Detroit Economic Club on Monday, Romney told an admiring audience that "Washington has to stop loading Detroit down with unfunded mandates. Of course fleet mileage needs to rise, but discontinuous CAFE [Corporate Average Fuel Economy] leaps, uncoordinated with the domestic manufacturers, and absent consideration of competitiveness, kills jobs and imperils an industry." Romney also proposed spending $20 billion a year on "energy research, fuel technology, materials science, and automotive technology."

But government regulation isn't killing Michigan's auto industry, nor is government neglect. Labor costs are. General Motors, especially, is getting crushed by the health benefits it pays its workers. The company and its 150,000 employees are paying the medical bills for 350,000 retirees, a cost to the company of more than $5 billion a year. If Romney wants to bring auto plants back to Michigan, he'll have to fund research into a shop rat who works for $2 an hour, never gets sick, and dies on retirement day.

"Probably starting in the mid-1990s to the late 1990s, the manufacturers of durable goods started to see that labor costs were simply not sustainable in an advanced industrial society such as Michigan," says Craig Ruff, senior policy fellow at Public Sector Consultants, a Lansing think tank. "All the entrenched American manufacturers found foreign competition intolerable. They simply could not undercut the price. By 2000, every economist in Michigan, every leader reached the conclusion that most of the jobs on the factory floor were never coming back. If the point of difference between McCain and Romney is whether the jobs are coming back, McCain is far more accurate."

Romney acknowledges the burden of legacy costs posed by company retirees, but in a Republican primary he's not willing to touch the solution the auto companies want: a national healthcare plan. Instead, he mocks "Hillarycare" and the notion of European-style social services.

Romney's supporters appreciated his message of free enterprise, but they also blame NAFTA for Michigan's job losses, and would like to see "fairer" agreements with foreign countries. Romney is an ardent free trader who believes that increasing the president's power to negotiate trade agreements can open new markets for American products -- especially cars.

"All those mileage standards, they kill us," said Dave Anderson, a real-estate agent from Rochester, whose business has been hurt by the housing slump. "People in Michigan like trucks, and people in Michigan are boaters. In order to pull a boat, you have to have a truck with guts. These mileage standards are going to have a ripple effect on the boating industry."

Gordon Schepke, a retired autoworker in nearby Troy, also condemned high-mileage cars, saying, "I was rear-ended in a car crash, and I would have been dead if I hadn't had a minivan." He fretted that it's fashionable in Washington to bash the auto industry for heating up the planet and enslaving America to Middle Eastern oil. "We can save jobs with fair trade agreements," Schepke said. "Our trade agreements help overseas companies, but they don't help us at all. I want it to be a more even playing field." He put it in even starker terms. "If we lose our manufacturing jobs we're going to lose our sovereignty. If we have another war, the Japanese aren't going to build our tanks."

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