FRANKFORT — U.S. Rep. Ben Chandler and his Republican challenger, Andy Barr, defended their opposing positions on the federal auto bailout during campaign stops Wednesday in a district laden with auto jobs.
After speaking to a group of senior citizens, Chandler told the Lexington Herald-Leader he was proud of his 2008 vote for the $85 billion rescue plan for automakers Chrysler Corp. and General Motors.
The auto bailout sparked renewed interest nationally this week after a heated exchange about it Monday night in the final debate between President Barack Obama and Republican challenger Mitt Romney.
Barr, who narrowly lost to Chandler in the 2010 race for Central Kentucky's 6th Congressional District, has repeatedly accused Chandler of needlessly raising the national debt by supporting Obama's spending initiatives. Chandler also voted for the $800 billion economic stimulus plan in 2009, but he opposed the $700 billion bank bailout in 2008.
Toyota, which employs about 6,700 full-time workers in Georgetown at its largest North American plan, favored the emergency loan plan, Chandler said.
"It would have affected all their supplier plants," Chandler said. "Almost every county in Central Kentucky has a supplier plant. Toyota came to me and asked me to support the auto bailout, even though Toyota wasn't getting any money but the health of their suppliers depended on it."
Chandler said many of Toyota's suppliers might have folded if GM or Chrysler went out of business.
"Absolutely I'm proud of my vote for it," he said.
Kentucky trails only Michigan and Ohio in the number of autos produced. In addition to Toyota, Kentucky has two Ford plants in Louisville and a GM plant in Bowling Green.
Barr, a Lexington attorney, criticized the auto bailout while visiting a Frankfort restaurant Wednesday.
"As Mitt Romney says, with a more limited federal assistance, the auto industry would have emerged from its financial woes in a much stronger position than they are in now," Barr said. "So many American companies go through difficult times — such as the airline industry — and have gone through Chapter 11 bankruptcy and have emerged even stronger."
Barr said he supports the auto industry and would have opposed liquidation of GM and Chrysler, "but I don't think the bailout actually helped. It was more federal intervention than was required."
Romney — who opposed giving a bailout to U.S. automakers — said in this week's debate that his plan to require bankruptcy filings first and possible government financing while under court restructuring would have worked.
After President George W. Bush gave GM and Chrysler $25 billion in the final weeks of his presidency, Obama did put the companies into bankruptcy. He added $60 billion to the bailouts and agreed to swap much of the government loans for stock in the automakers in a plan to get the companies through bankruptcy in just 40 days. He also removed the CEOs of both firms.
The Treasury Department estimated in August that the auto bailout will eventually cost the government $25.1 billion.
The Obama campaign this year touts bringing back the auto industry, and claims Americans would be buying cars from China instead of Detroit if there had been no bailout.
Total employment for car makers and parts suppliers is up about 250,000 from 2009, according to PolitiFact.com. Sales were up by double digits in 2011 for GM, Ford and Chrysler.