Obama Offers 'Rust Belt' Aid to Offset GM Bankruptcy

Secretary Hilda Solis announced plans to provide Michigan with another $49 million to help retrain laid off workers.

Armed with aid packages and promises of a better future, President Barack Obama's cabinet members fanned out across the U.S. "rust belt" on June 2 to calm concerns in the wake of a bankruptcy filing by General Motors.

The political risks for Obama were high as the government took a 60%stake in the troubled automaker in exchange for providing $50 billion dollars to help finance a restructuring which includes plans to close 14 plants and cut 21,000 U.S. jobs.

The layoffs will hit states like Michigan and Ohio which are already devastated by a decades-long decline in the manufacturing base. Labor Secretary Hilda Solis announced plans to provide Michigan with another $49 million to help retrain laid off workers while touring a GM engine plant in Romulus, Michigan. Some 700,000 jobs have been lost in the state of Michigan alone since the beginning of the decade.

"I know that it's staggering right now, but the Obama administration is fighting like the dickens to turn it around," Solis told a small group of workers.

The fuel-efficient and hybrid engines built at Romulus will help General Motors reshape its business for the 21st century, Solis said, and the administration will help fuel the growth of "green" jobs.

"Traditions change, history changes and it changes us," Solis said. "It's time to step up to the plate and be ready for that change."

Plant manager Rick Sutton tried to rally workers who face a temporary layoff on June 5 as GM factories across the country are idled during the bankruptcy process, which is expected to last 60 to 90 days. "We have a lot to be proud of here," Sutton said. "We make some of the best products in the world."

Michigan governor Jennifer Granholm was also on hand for the tour. The GM bankruptcy is "a game changer for Michigan," she said, and the state needs to focus on drawing the jobs of the future. "As we turn the page and begin a new chapter for Michigan and GM we are not interested in looking in the rear-view mirror," Granholm said. "We have such great bones and such great strengths to build on as a state."

Solis was set to tour Ypsilanti, Mich., Perrysburg, Ohio and Maumee, Ohio and the list of senior officials who will spend the week touring Ohio, Mich., Indiana and Wisconsin is long. It includes the secretaries of commerce, education, urban development, interior, agriculture, energy, and transportation and the heads of the Environmental Protection Agency and small business administration.

They will tour factories, meet with local officials, hold town hall meetings, speak at universities, and talk about federal programs which aim to send money and jobs into the communities.

"At each event, they will discuss immediate ways the federal government is cutting through red tape to bring relief to auto communities and achieve long-term economic revitalization for America's communities that depend on the auto and manufacturing industry," the White House said.

Copyright Agence France-Presse, 2009

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