is on his way as well american auto companies have long been a symbol of the industrial vigor that has made our country strong and prosperous generations of americans have worked for general motors and chrysler they should be proud of their service we are here today because in late two thousand and eight the federal government took extraordinary actions to intervene in automotive industry among firms that were bailed out was general motors which received roughly fifty dollars billion in assistance this decision and its aftermath fundamentally remade the way our government interacts with the private sector goals of revitalizing the company megan of the atlantic has found that we could have given every hourly gm employee two hundred and fifty thousand dollars and still come out on top furthermore the bailout of gm desecrated the rule of law the bankruptcy proceedings that occurred were simply a patchwork  legal vehicle for delivering ownership shares from the auto companies due to the government what may have seemed expedient at the time disregarded the true intent of our bankruptcy process in the end the auto bailouts set a precedent that will make it more difficult for major companies to go through bankruptcy proceedings in the future resulting in serious moral hazard it wasn't even clear that these actions were legal in the first place after congress failed to pass legislation to allow for the bailout only then did president bush move to do so under the troubled asset relief program however tarp was designed to purchase troubled assets from any financial institution on such terms and conditions as determined by the secretary todd a legal expert and professor at george mason university has pointed out tarp legislation did not permit the use of the allotted funds gave the auto task force a clear message the first was to behave in a commercial manner by ensuring that all stakeholders were treated fairly and received neither more nor less than they would have simply because the government was involved the second was to refrain from intervening in the  management of those companies this hearing is taking place today largely because we believe that both of those directives were faulted the committee believes there is substantial evidence that decisions made by the administration in the handling of the gm bailout were often politically motivated and that to the detriment many government chose winners and losers the treatment of delphi pensions epitomizes the picking of winners and losers that occurred in the gm bailout one group hourly and union employees are still receiving their full pension while another group salaried nonunion employees is receiving just a portion of their pensions as a result of decisions made in the treasuryorchestrated bankruptcy process the american people have the right to know that their money was not used to advance political ends and that every dollar was loaned with the intention of getting gm on a sustainable course to repay the assistance to general motors are the hundreds of thousands of jobs saved and the hundreds of american communities spared further suffering in the midst of the economic recession on july five two thousand and nine the united states bankruptcy court for the southern district of new york issued a decision concluding that if the federal government had not come to gm's aid the firm would have liquidated the court wrote and i quote there are no merger partners acquirers or investors willing and able to acquire gm's businesses other than the united states treasury and canada's export credit agency there are no lenders willing and able to finance gm's continued operations administration took over they required as a condition of additional aid that both gm and chrysler implement viable plans to reduce their costs and effectively compete in a changed auto industry after extensive restructuring the new gm quickly exited bankruptcy in july of two thousand and nine the results of our nation's investments are now becoming clear the first quarter of two thousand and eleven was gm's fifth consecutive profitable quarter according to robert investment in the auto industry becomes even clearer when we consider the costs of inaction according to the center for automated motor research even a fifty percent reduction in the operations of the big automakers could have reduced personal income by more than two hundred and seventy five dollars billion over three years resulting in a loss of more than one hundred dollars billion in state and federal tax revenues the federal government's investment saved hundreds of thousands of jobs and gave these automakers a new lease on life the committee will hear today from one of the principal architects of our investment in the auto industry mister ron bloom and i welcome his testimony i also welcome the testimony of our other witnesses by two thousand and five it had filed for bankruptcy and in two thousand and nine the pbgc took over the company's pension plans gm agreed to top up the pensions of employees of delphi main unions meaning they will receive the pensions they were promised but such topups were not provided to delphi's salaried employees or certain other union employees given the statutory limits on the benefits that the  many delphi many of delphi's salaried retirees are receiving benefits that are far lower than promised by delphi the consequences of these shortfalls to salaried retirees are truly heartbreaking particularly as these bloom is also being sued not just in his official capacity but as an individual citizen whose personal assets are on the line obviously this will prevent him from answering questions on this matter a situation i hope and for the importance really of the issues that we are addressing today i was very disappointed to hear that the administration has prohibited mister bloom from speaking to us on the important issues of delphi's pensions i was hoping the white house unveiled a report entitled resurgence of the american automotive industry and president obama paid a visit to toledo ohio what neither report noted nor did the president mention was the administration's plan to restore benefits to the delphi retirees i believe it's because there isn't one the administration picked winners and losers where the pensions of many salaried delphi workers were lost this was done without any explanation without any justification or without basis and today it is still being done without any answers now i beg to differ what prohibits mister bloom from answering is that perhaps the answers or the truth might be damaging in litigation and that being it would be damaging because these delphi retirees are entitled to these benefits these benefits were wrongly taken from them and they deserve an answer we live in a government where the government is responsive to the people things can't happen in secret the administration picked winners and losers and not only do the taxpayers need to know because taxpayers money was involved but certainly these delphi retirees deserve an answer but more importantly they deserve the restoration of these benefits almost fifteen thousand salaried retire workers some of which were denied up to seventy percent of their pensions all of them one hundred percent of their life insurance and one hundred percent of their health insurance it is devastating to them it's an action that was done to them by this administration while they were picking winners and losers and it's one that needs to be addressed by the administration not only just in providing answers which is what we are seeking today but also in solving these workers deserve to have their pensions restored now pursuant to this hearing we have the ability  your finally attending to give them the information that they deserve with that mister chairman thank you for having this hearing and we look forward to getting some answers for these retirees mister jordan i thank the gentleman from ohio for his statement and for his being here today and his hard work oversight but it's also a chance to take stock of a critical and successful government intervention the federal government saved two companies gm and chrysler and probably an entire region of the country i come from that region there's a gm factory located east of cleveland called lordstown in march of two thousand and nine the community of lordstown ohio was profiled by cbs news in this way they said quote holding on for dear life where seventy percent of the town's tax base came from the gm plant according to the mayor just last month the cbs news story profiled this community in a completely different light it talked about it being jolted back to life by four thousand pounds of steel the lordstown gm plant was essentially dead for a short period of time without a single car being manufactured but it's now alive and employing around four thousand five hundred people those workers are using parts made down the road in my district roughly twenty percent of the parts from the gm parma metal center in my district go to lordstown for the manufacturing of the chevy cruze the interconnectedness of the region doesn't stop there the parma gm metal plant buys equipment from the automatic feed company of napoleon ohio to make auto parts sustaining yet another ohio workforce the web of connections goes on and on in communities responsible for the parts materials equipment goods and services that the auto industry the workers and their families depend upon whether or not this web survived or was torn apart was at stake in late two thousand and eight and throughout two thousand and nine thankfully the bush administration decided rightly to make the first loans and the current administration built on what the bush administration did with more financial support for the restructuring of the industry and its successful emergence from bankruptcy the most important point that i hope we remember throughout this hearing is the calamity which was averted for these communities through our investment in the auto industry without that investment as many as three point three million u s jobs would have been lost amounting to between five percent and three percent yearly reduction in gross domestic product from two thousand  languish in ruin as the jobs revenue and tax base for essential community services evaporate in light of the success achieved by our support for gm this hearing will also examine a difficult situation faced by workers and retirees of gm parts  delphi being mindful of the ongoing litigation on this issue in fairness to the other witnesses testifying at the hearing i welcome the opportunity to hear testimony from bruce gump of the delphi salaried retiree association  truly difficult situation that has been experienced by the individuals that organization represents mister chairman on this point before i yield other committees such as education and labor as long ago as december two thousand and nine have heard testimony on the fact that certain retirees of delphi such as salaried retirees as well as retirees represented by a number of unions lost their benefits through delphi's bankruptcy because they had no agreements to have their benefits topped up to the level they have worked for and deserve it's a very painful situation and i know it's an issue that concerns you as well mister chairman and while i appreciate mister gump coming here i think what we need to do is to determine a course of action that would solve the problem so i would ask you if we could work together on legislation that would correct this situation and consider whether or not that legislation would enable the topping up of benefits of all the delphi retirees and the union retirees who saw their benefits disappear the gentleman from cleveland and working with you and other members from the ohio delegation and surrounding states and congress on what is the best approach moving forward so i appreciate the gentleman's statement mister kucinich i would like to work with you and other members of the committee on this and as ohioans i think we have the chance to reaffirm our support not just for automotive but america's manufacturing base has been at risk and while i join with you in fighting the bailouts to wall street which  produces paper we are talking about people who produce cars people who make steel aerospace products shippers manufacturing american manufacturing is something we ought to be investing in and i want to thank the chair for holding this hearing so we can get into these helped that community underscores what took place here there were winners and losers selected we have just down the road in mansfield ohio a gm facility that was closed and what we are trying to get at was were these decisions made by general motors or were they in fact made by the auto task force and people in the government not only picking winners and losers and who they were going to provide money to but also getting into the daytoday operations of the company and deciding which facilities would stay open and which ones would not that's an important question and one that i think we need answered the thing that does bother me is we will never know if general motors could have survived on its own because the general motors that i know the general motors that my dad started with as a parts picker in the thirties and went through a war and he came back home and was able to rise through the organization and buy his own dealership and i am talking about not a huge dealership but a onecar showroom in a little town called verona and build it into something we were very proud of through hard work through hard work not that somebody picked that he was going to be a winner or said no you don't have an opportunity that never happened to him but it did happen to me it was after the government takeover of general motors in a business that we worked very hard to build for fifty six years i got a phone call and in five minutes fifty six years of work and saving and putting everything on the line was pretty much taken away i got a phone call said listen you know what where are you and i said i am sitting at my desk and said well i am in detroit i am with a lawyer and i am recording this and we need you to sign that document we sent you yesterday i said are you talking about the thirty nine pages absolutely i said i am not signing it they said why not i said because i refuse to give up my franchise they said well that's really not up to you we made a decision and i said well you know i have got to tell you it is up to me  up to the people the andsome people that work with me every day and to have somebody make a phone call and tell me that you are no longer going to be a dealer because of a decision that was made not by car people but by government not by people who have any skin in the game not by people who put their whole life on the line but by people who made a decision based on some type of metric that i absolutely have no idea where it came from and then when you say hey i am going to fight you i am going to arbitration for somebody to we got through it went to arbitration got the dealership back by the way my friends that didn't go to arbitration are no longer in business not because they couldn't make it in the open market because government decided they would go out of business that is not america make sense by the same people they are fourteen dollars thirty cents trillion in the red telling these guys they don't know how to run a business so my question is where does it lie what really could have happened because in my opinion the government is the one that picked and chose who was going to win and who was going to lose and so from my standpoint mister chairman i do appreciate the opportunity to be here today from somebody who has been able to get through some very difficult times and we are now in our th year not because of things that we have done separately but things that we have done collectively as an organization and through the grace of god we have been able to get through it but i do wonder the direction of the country and when we place our faith in our future in the hands of those who have never done it who have never walked in our shoes who have never done the things we have done but who do have the ability to open a laptop and tell you you are no longer in business that's not the american way i don't accept it my father certainly wouldn't have accepted it and i think it's  so i thank you for what you are doing because we are here truly to make sure that the job creators the small business people have an opportunity to compete and that it is not taken out of their hands by somebody who has never ever had any skin in the game so i thank you thank the gentleman for his opening statement mister jordan well now i think what we are going to have to do is swear in our witnesses and i apologize guys it's one of those days we will swear you in it's the custom of the committee to do that and then we are going to have to take a brief recess hopefully brief to go vote and then we will be back for questioning and we will try to be as accommodating with your time we understand you're busy as well but unfortunately we do have three votes on the floor so if you will just rise and raise your right hand do you solemnly swear or affirm that the testimony you are about a senior manufacturing adviser to the president i believe and then also mister vince snowbarger as the deputy director of the pension benefit guaranty corporation and a former member of congress from new york state