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Week In Politics: Auto Industry, Economy

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Week In Politics: Auto Industry, Economy

Analysis

Week In Politics: Auto Industry, Economy

Week In Politics: Auto Industry, Economy

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Michele Norris speaks with our regular political commentators, E.J. Dionne of The Washington Post and Brookings Institution and David Brooks of The New York Times, about the aftermath of the auto bailout and the economy.

MICHELE NORRIS, host:

And we turn now to our regular political commentators E.J. Dionne of The Washington Post and the Brookings Institution. And David Brooks of the New York Times. Welcome to both of you.

Mr. E.J. DIONNE (Commentator, The Washington Post): Thank you.

Mr. DAVID BROOKS (Commentator, The New York Times): Good to see you.

NORRIS: This week we saw a battle over immigration law in Arizona that we just heard about. The White House going on the defensive over education reform and the auto industry turnaround. Let's begin with immigration. If this issue continues at a full boil all the way through November, E.J., how will it play out in the midterm election?

Mr. DIONNE: Well, I think the common view is that the court declaring parts of the Arizona law illegal is going to help Republicans because a lot of voters will be angry that these restrictions, which are popular, according to the polls, won't go into effect.

I think there's some truth to that because control of the House is determined district by district. And a lot of the swing districts have very low or relatively low proportions of Latinos. So in those districts the immigration issue may at the margins help the Republicans. I'm not sure that it's going to have the enormous negative impact, A, all of this could finally begin to boost Latino turnout, which people, as the piece just said, have worried would be low this year.

And, secondly, I think a lot of the people who are strongly opposed to immigration reform, strongly for the Arizona law, a lot of those people were voting Republican anyway.

NORRIS: So, help Republicans is what you're saying.

Mr. DIONNE: Help slightly, but I don't think as much as the conventional wisdom would have.

NORRIS: Now, David, we just heard from someone in the Jeff Brady piece who said this is going to hurt Republicans.

Mr. BROOKS: Yeah, eventually. Eventually, if current trends continue, the Republicans will not be able to be a national party because they will have no Latino voters.

Mr. DIONNE: Precisely.

Mr. BROOKS: And that's going to be true in Texas, California and a lot of places. But in the short term I think it'll strongly help. And on top of everything directly involving immigration, there's a class component here. There's a popular sense that there's a ruling class that doesn't get the concerns of average people. That this ruling class doesn't live in neighborhoods where a lot of illegal immigrants are, doesn't work in jobs where a lot of illegal immigrants compete and just don't get it.

And that the people of Arizona democratically voted this thing in and then the judge struck it down. That's going to seem to people fundamentally outrageous and anti-Democratic. So I think in this atmosphere where a lot of hostility toward the perceived ruling class, this will be a strong issue because it hits right at that point.

Mr. DIONNE: I think there's some truth to that. Although David said an important thing when he mentioned California. That's a state where the Republicans had hoped to pick up the governorship, a Senate seat and I think this will galvanize the very big Latino vote in California. So that's why I think it has a differential effect around the country.

NORRIS: There is a story that's percolating today based on a question of whether the administration might be considering a strategy to bypass Congress on immigration, thinking that Congress might not act on its own by issuing new guidance and regulations. This is based on a memo written by the director of the agency that handles immigration benefits. David, is a scenario you can imagine?

Mr. BROOKS: It would be extremely dangerous for the same reason. If people see people really care about immigration, Democrats and Republicans. If they see some major reform being passed without a democratic process, they'll be angry. But let's not forget that this is actually a much more flexible issue. People are pretty sophisticated about this. The voters really do like the Arizona law, but they also like comprehensive reform. They acknowledge there are these 12 or 14 million people here and we've got to realistically deal with them.

So the public is pretty flexible and I think pretty realistic and with some wise leadership, which we almost had a couple years ago, you could get a pretty serious and substantive bill. So I don't think there's a need to go around the legislative process necessarily.

NORRIS: I want to turn to another issue. The president was in Detroit today to do a little chest pounding on the administration's bailout of the auto industry. Let's take a quick listen.

President BARACK OBAMA: There were leaders of the just-say-no crowd in Washington. They were saying, oh, standing by the auto industry would guarantee failure. One of the them called it the worst investment you could possibly make.

NORRIS: Now, that's the president speaking to Chrysler workers. He then went to GM to test drive the Volt. The car has a name that makes it sound like it's some sort of superhero. But is a $41,000 electric car the future of the auto industry, E.J.?

Mr. DIONNE: Well, the Volt probably is overpriced, but on the broader message...

NORRIS: Oversold as well?

Mr. DIONNE: Over well, I think somehow we're going to move in that direction. Its price is a little high. But I think the president had every right to brag today. A lot of people said majority of Americans were against this bailout. And by the way, we should give a little credit to George Bush, which I'm not accustomed to doing because he did the initial bailout that let Obama create the plan that created. My friend David thought this would be a quagmire, to use his word at the time.

In fact, they have restructured these companies. There hasn't been the political there haven't been the political shenanigans that people predicted. They are being run like businesses. And as the president said, all three companies are profitable for the first time since 2004.

They haven't gotten to brag about enough lately. I think this one they have a legitimate right to brag about.

NORRIS: David, you were not a fan of this, are you rethinking your position?

Mr. BROOKS: Yeah. I mean they're certainly bragging and they're certainly enjoying the columns that I wrote against it, to which they sent to me with great rapidity in the last couple days. So, let them have their moment.

You know, I opposed it because I thought the culture of GM and Chrysler had been in decline for 30 years. I didn't think the government could really turn it around. I thought the quality of the fleet was quite low. I thought we should devote resources to productive uses, not to failing companies.

But having looked at so far the last year it's clear that GM and even Chrysler is in better shape than I thought it would be. There's some chance that there could be, you know, a real turnaround. So it's possible. I could be wrong. It would be a rare instance and a very valuable column because it is so rare.

NORRIS: A rare incident. Okay. All right, you know.

(Soundbite of laughter)

Mr. DIONNE: Let's not go there, David.

Mr. BROOKS: But, no, I think those (unintelligible) right now...

NORRIS: I'm going to pull away before thunder strikes you here in the studio.

Mr. BROOKS: We look like we were wrong, right now.

Mr. DIONNE: Next week I'm going to bring in three dozen Brooks columns just to read on the air.

NORRIS: When the White House points to the resurrection of the auto industry, it should be looking at a fuller picture, though? Is the administration telling perhaps only part of the story? What about the shuttering of thousands of auto dealerships? Was that a precipitous move?

Mr. DIONNE: No, I think that the auto industry was in deep trouble and in order to get the bailout, there had to be a lot of restructuring. A lot of people, as the president said, took real hits on this. The workers took hits, the auto dealers took hits, although they're the only group that actually got some relief from Congress.

The banks took some hits on this. The question was if we hadn't done this, we might not have an auto industry. The administration says we would've lost a million jobs. There were estimates at the time that if you added up all the mom and pop shops and everything else dependent on the auto industry, we could've lost 2.5 million, 3 million jobs in the Midwest. We avoided that catastrophe and I think this is one time where that really fits in with people's sense of things, that usually you can't say it could've been worse. A lot of people in the Midwest understood the dangers if the auto industry had collapsed.

NORRIS: You know, while we're talking about jobs, though, we only have a little bit of time left, but as we head into the midterm elections, there's always the question that voters wrestle with as they head to the polls: Are you better now than you were a year ago in this case, are you better now than you were two years ago in the midterm elections? Can the Democrats make the case does the administration try to help Democrats make the case that people are better off right now, at least better, you know, heading, trending in a better direction?

Mr. DIONNE: The oh, go ahead, David.

Mr. BROOKS: Well, I think it's just a very weak economy. I don't think people are going to feel better. They certainly don't perceive that 61 percent of the country is heading in the wrong direction. And I think we're looking at a possibility that we could have seven or eight years. There are so many forces which we're going to dampen the economy, high consumer debt, weak trading partners, high unemployment, terrible labor markets.

We really could be looking at seven years of very stagnant growth. And I think both parties are now cluing into that and trying to figure out policies big enough to cope with that huge problem.

NORRIS: Very gloomy picture you see ahead. Is your picture any brighter than that?

Mr. DIONNE: I wish I could be a sort of completely hopeless optimist here. But, no, it doesn't look great. But I think the key word in your question was trend. I think the administration - first of all, a lot of people are actually reporting to pollsters that they are better off. But a lot of people still don't think the trend is good. The administration has to persuade people. It's going to get better and it's starting now.

NORRIS: E.J. Dionne of The Washington Post and the Brookings Institution. David Brooks from The New York Times. Have a good weekend. Thanks to both of you.

Mr. DIONNE: You too.

Mr. BROOKS: And you too.

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