Barack Obama’s plan to appoint a “car czar” to oversee the auto industry bailout has been shelved, reports the New York Times. Rather than appoint a single individual (presumably of Romanov extraction) to administer the government handout, the President has ordered Treasury Secretary Timothy Geithner and chairman of the National Economic Council, Lawrence Summers, to lead a “Presidential Panel on the Auto Industry.” Or Presidential Auto Task Force. Or Presidential Task Force on Autos. Or something. Either way, it’s time to start spreading the inevitable blame around. After all, GM’s top dogs have evaded responsibility for decades of disaster by embracing complexity. And it’s just so much harder to burn a committee in effigy.
According to the Times, Geithner (officially, Obama’s “designee”) and Summers will be joined by labor union advisor Ron Bloom, as well as officials from the departments of Treasury, Labor, Transportation, Commerce, and Energy; the National Economic Council; the White House Office of Energy and Environment; the Council of Economic Advisers; and the Environmental Protection Agency. Bloom, an advisor to steel and airline industry unions will work as a senior advisor to the Treasury on the auto crisis.
And what of Messrs Rattner and Girsky? MIA for now, says the Times. Needless to say, we’re dying to know what role conflicts of interest played in keeping Rattner away from the party. And if Bloom is the new Girsky.
Inside baseball aside though, things are pretty much chugging along as usual. Obama won’t give out his plan until he hears Detroit’s plans, and Detroit can’t make plans until they swap debt for equity which bondholders won’t do until the UAW makes further concessions, which the UAW won’t do until debtholders take a bigger haircut, and on and on.
Sure, a single Czar might have had the power and leadership to take hold of Detroit and shake it till it stops chasing its tail. But he might have also triggered default clauses for Detroit’s credit-default swaps.
Ultimately though, the buck has to stop somewhere. Geithner and Summers are no more likely to resign over a bungled Detroit bailout than Obama. And committees are rarely more strict than an individual who knows that their reputation is at stake. But apparently convoluted businesses need convoluted rescue parties.
I welcomed the minister of rubber and metal. I thought that was an excellent way to avoid the same rulings that would come for a bankruptcy judge, without throwing the co’s into bk, and spooking the public more than they already are.
Too bad, so sad.. :(
The good news is that Geithner already has a plan to fix the domestic auto industry.
Step 1: Make a plan
Step 2: ?
Step 3: Fix the auto industry
Yeesh! Why doesn’t the government just send the auto companies an ATM card and pin number to the taxpayers’ account? What a cluster………
Just what the industry needs, more bureaucracy. That Obama’s so smart!
Perhaps there were no qualified car czar applicants without “honest mistakes” on their income taxes.
Good idea. Stick a dozen bureaucrats in a room.
@guyincognito
Considering how Geitner fleshed out his plan for the banking fiasco I’d imagine his plan is more something like this
1. ?
2. ?
3. Fix Auto Industry
I’m still unclear how all this braintrust is going to get people to buy cars they don’t want. Short of banning the sale of anything else Americans just are not going to buy these products in sufficient quantity and at a high enough price to feed all that makes up Detroit.
How far are they willing to go? Tariffs on cars made here with a foreign company name badge? How about cars made overseas with a domestic company name badge?
It’s gone from being silly and stupid to downright frightening.
I didn’t realize that among The One’s talents were business expertise in running companies. Ditto the crew he assembled for this task, remind me again how many companies they turned around to make a profit. The real dance here is to keep all those Union jobs at the same or nearly same payrate with no loss of retirement or fringe benefits while simultaneously convincing the American Public their tax dollars will be protected and paid back with interest. All the while the entire US car market is going down the drain.
I don’t see this as a bad thing. The relative anonymity of a committee provides more political cover to make tough choices than a single individual in the public eye might.
President Hopenchange,
Where’s the hope? I ask because I definitely see no change.
Or as your VP so eloquently put, “That’s not change… that’s more of the same”.
Oh, and I heard Bob Lutz was posting his resume on Monster.com at the end of the year.
This is not good. One person can make a bold decision. Even a bureaucrat, on occasion. A committee? Seldom. A committee of bureaucrats? Never. Looks like a stall, to me. Problem is, they can’t stall without paying several billion dollars to maintain the status quo, while the brain trust sorts out the problems and comes up with the perfect political compromise. My, I sound pessimistic, don’t I.
Well, jp, when faced with a train going 90 mph down hill, no brakes, no switches to different tracks, with the throttles wide open – and realizing there is a bridge out ahead – it isn’t called pessimism. It’s called realism. AKA “oh (fill in the blank with your favorite bad word)”
A camel is a horse that was designed by a committee.
CLUSTERF#$%@&
With any luck at all, they will be unable to decide on anything and therefore do nothing. People talk about gridlock as a bad thing; I worry more when they get things done.
It’s not as complex as it may sound. Summers was Geithner’s mentor, so they should work together just fine. Summers is also incredibly smart. Each of his parents has a sibling who won a Nobel (Paul Samuelson and Kenneth Arrow). And Summers is strong willed enough to keep the panel from squabbling ineffectually.
FWIW, years ago, when Summers had small children, he drove a Taurus wagon.
David Holzman said:
Summers is also incredibly smart. Each of his parents has a sibling who won a Nobel (Paul Samuelson and Kenneth Arrow). And Summers is strong willed enough to keep the panel from squabbling ineffectually.
Yeah, the CEOs of Lehman Brothers, Countrywide and even GM are smart men too.
Back in 2000, a [hedge?] fund defaulted, while operating under the guidance of two Nobel economics prize winners.
So, that kind of qualification means crap.