Jack Hatch is wrong – auto bailout was not needed to help Iowa manufacturers.

Contrary to the letter by Jack Hatch, the Obama administration and Congress were wrong in the way they handled the auto manufacturer’s bailout.  (See The Des Moines Register, 11/3/2012, “Auto bailout saved many Iowa jobs, too”)  Romney is correct that we should have followed established bankruptcy laws.  The bankruptcy process would have allowed the companies to remain open and the jobs to not be lost.  The companies could have reorganized their debt and equity and emerged from bankruptcy stronger.  What actually happened was that politically favored creditors, such as unions, were given unfair preferences, and some unfavored creditors were cheated out of their lawful security.  It is quite likely that Iowa manufacturers would have continued to supply their parts to the industry even if the law had been properly followed.

Link to Register article: http://www.desmoinesregister.com/article/20121104/OPINION04/311040058/Letter-to-the-editor-Auto-bailout-saved-many-Iowa-jobs-too?Opinion&nclick_check=1