Obama heads to Ohio to defend record, reach voters

Under pressure on unemployment, President Barack Obama will remind voters that his 2009 auto bailout saved thousands of jobs in a visit on Friday to Ohio, a state vital to his re-election hopes.Obama will arrive at a Chrysler Group Llc plant in Toledo hours after the release of a monthly employment report that delivered Americans a stark reminder that the labor market remains weak and unemployment high.

The numbers follow a rash of data signaling the economy may be losing steam. Obama, a Democrat, must coax the jobless rate down convincingly in order to be confident of securing a second White House term.

Polls show he is still favored over all potential Republican opponents.

But the troubled economy remains his biggest weakness, and that vulnerability was underscored by a disappointing May jobs report on Friday that saw unemployment nudge up to 9.1 percent from 9.0 percent in April.

Republican Mitt Romney kicked off his second bid for the White House this week by accusing Obama of spending too much and not protecting jobs.

“Today’s unemployment numbers show that we are going backwards, and that is the wrong direction for America. President Obama’s policies made the recession worse and as a result more people are out of work,” Romney said on Friday.

Obama won Ohio by a 4-point margin over challenger John McCain in 2008. But the state went narrowly to Republican President George W. Bush in 2004 and is expected to be highly competitive in 2012.

The White House claims credit for the rescue of the auto industry and hopes this success for manufacturing will warm Obama to blue-collar voters, whose support he needs to win next year.

“The president took dramatic action, including unpopular decisions like bailing out the … American auto industry, because he felt it was the right thing to do,” White House press secretary Jay Carney said on Thursday.

Chrysler repaid the government $5.9 billion last month, deepening ties with Italian automaker Fiat SpA and highlighting the extent of the auto industry’s recovery since a bailout in 2009.

It was initially expected to cost taxpayers $80 billion, but estimates have since shrunk to a small fraction of that price.

General Motors Co filed for bankruptcy in 2009 but soon emerged from under court protection thanks to Washington‘s rescue. Its profits are now beating expectations.

Ford Motor Co did not take a government bailout but did receive direct and indirect financial assistance through loans, capital, tax credits and other programs that have aided its strong turnaround.

The administration expects the rescue will end up costing taxpayers around $14 billion, and argues that it saved far more money because it safeguarded hundreds of thousands of jobs.

This spared authorities from making billions of dollars in unemployment benefits, as well as forgoing tax revenue.

 

WASHINGTON (Reuters) – By Alister Bull(Editing by Mohammad Zargham)

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