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A Project of The Annenberg Public Policy Center

Hit the Brakes

An Obama ad running in Michigan claims McCain didn't support loan guarantees for the auto industry. In fact, he does support them.


A new Obama ad targeted to Michigan voters says McCain "refused to support loan guarantees for the auto industry."

That was true, but it’s not now – and it wasn’t when this ad was made. Yet the ad doesn’t mention McCain’s changed position on government support for the carmakers.


The Obama campaign ad, "Revitalize," is running in Michigan, where the auto industry is on the ropes.

[TET ]

Obama for America Ad: "Revitalize"

Obama: I’m Barack Obama and I approved this message.

Narrator: In tough times, who’ll help Michigan’s auto industry? Barack Obama favors loan guarantees to help Detroit retool and revitalize. But John McCain refused to support loan guarantees for the auto industry. Now he’s just paying lip service, not talking straight. And McCain voted repeatedly for tax breaks for companies that ship jobs overseas, selling out American workers. We just can’t afford more of the same.[/TET]

Big Three Blues

The spot portrays Sen. John McCain as being callous toward the auto industry and American workers in general. In particular, it claims that he "refused to support loan guarantees for the auto industry."

It’s true that at one point McCain declined to support the initiative, which had been authorized but not funded by Congress last year in order to help speed the Big Three automakers’ switch to producing more fuel-efficient vehicles. What the ad doesn’t say, though, is that the quote shown on the screen – "McCain Opposed Government Help for Automakers" – is actually from a Detroit News article last month describing how McCain had reconsidered his position and is now in favor of low-cost loans to the industry. The full quote:

Detroit News, Aug. 23: The loan program got a boost Friday when likely Republican presidential nominee John McCain, who had opposed government help for automakers, said he would support low-cost loans, although he did not specify a funding amount.

The Detroit News article goes on to say that Obama "criticized McCain for changing his position on the same day a new poll showed McCain losing ground with Michigan voters." This may be what the ad means when it says McCain is "just paying lip service."

We can’t say what caused McCain’s reversal. At the time he opposed the loan program, he justified his position by saying that "I worry a little bit about us predicting failure on the part of the automakers when they’re struggling mightily." His own proposals included tax rebates for buyers of electric cars and a $300 million prize for development of a more efficient battery. But the GOP candidate says he now supports auto industry loans.

Shipping Out

As for the ad’s claim that McCain has supported tax breaks for companies that ship jobs overseas: At least one of those tax breaks – which allows corporations to defer paying taxes on their overseas earnings until they bring the money back to the U.S. – doesn’t have an awful lot to do with whether jobs stay in the country or not. It wasn’t true in 2004 that the tax break caused jobs to move abroad; it wasn’t true earlier in the campaign; and it’s not true now. We’ll have more to say on this subject soon.

– by Jess Henig


Shepardson, David. "Big 3 seek $50b in fed loans." The Detroit News, 23 Aug. 2008.

Shepardson, David. "McCain supports loan guarantees for automakers," The Detroit News. 22 Aug. 2008.

Trowbridge, Gordon. "McCain withholds support for auto company loan guarantees." The Detroit News, 13 Aug. 2008.

Hyde, Justin. "Auto industry to blitz for aid." Detroit Free Press, 23 Aug. 2008.