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Romney credits Bush, Wall St. bailout for avoiding depression

 

Mitt Romney offered an unprompted defense of the 2008 Wall Street bailout on Wednesday, crediting President George W. Bush and the preceding administration for averting an economic depression.

Answering a question during a campaign event in Maryland, Romney both condemned the 2009 bailout of troubled automakers engineered by President Obama while praising the Troubled Asset Relief Program authorized in fall of 2008 to prop up the financial services industry.

"There was a fear that the whole economic system of America would collapse -- that all of our banks, or virtually all, would go out of business," Romney said. "In that circumstance, President Bush and Hank Paulson said we've got to do something to show we're not going to let the whole system go out of business. I think they were right. I know some people disagree with me. I think they were right to do that."

Romney's remarks were somewhat overshadowed by two other stories swirling around his campaign today, one relating to an aide's gaffe comparing Romney's pivot to the general election to erasing an Etch A Sketch; Romney also won the endorsement Wednesday of former Florida Gov. Jeb Bush (R).

It was Jeb Bush's brother, former George W. Bush, whom Romney said deserved the lion's share of credit for saving the financial sector from collapsing during the 2008 crisis.

"I keep hearing the president [Obama] say that he's responsible for keeping America from going into a Great Depression," Romney said. "No, no, no. That was President George W. Bush and [then Treasury Secretary] Hank Paulson that stepped in and kept that from happening."

But Romney also reiterated opposition to the 2009 decision to support General Motors and Chrysler, funds for which were drawn from TARP. The former Massachusetts governor said he drew a distinction between Bush's actions and Obama's, which he said only forestalled the necessary bankruptcy for automakers, and gave unions undue influence over the remade companies.

Stil, Romney's defense of the Wall Street bailout comes at a point in his campaign where he looks to pivot toward the general election, and away from the primary battle against former Pennsylvania Sen. Rick Santorum and former House Speaker Newt Gingrich.

Santorum in particular has taken aim at Romney's support for TARP, arguing that Romney was acting as a friend to Wall street. While campaigning in Michigan, Santorum, who opposed both bailouts, questioned why Romney would support one for the financial industry, and oppose one for the auto industry.

Moreover, the Bush administration's decision to act to support the financial services industry was an especially distasteful decision among conservatives -- a group that hasn't fully embraced Romney in his bid for the Republican presidential nomination. TARP is seen as a program that helped spark the genesis of the Tea Party.