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Carmaker, Banker, Broker ...

Posted on Feb 16, 2009

By Eugene Robinson

    This is a presidency on steroids. Barack Obama’s executive orders alone would be enough for any new administration’s first month: decreeing an end to torture and Guantanamo, extending health insurance to more children, reversing Bush-era policies on family planning. That the White House also managed to push through Congress a spending bill of unprecedented size and scope—designed both to provide an economic stimulus and reorder the nation’s priorities—is little short of astonishing.

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    Now it’s time for the administration to get to work. For his next act, Obama must set the parameters of a new presidential role that he did not seek but cannot avoid: managing the big chunks of the private-sector economy that are now more accurately described as semiprivate at best.

    This week, executives from General Motors and Chrysler are reporting on their progress in transforming themselves into lean, mean car-making machines, capable of leading American industry into a new golden age. They will also explain that they need some more money, and fast, or they’ll crash and burn. GM, which got a $9.4 billion cash infusion from the government just two months ago, wants the remaining $4 billion that the Bush administration approved; Chrysler, which got $4 billion in December, needs an additional $3 billion urgently.

    Maybe it’s just baby-boomer nostalgia for the car culture of my youth, but I think it’s a good idea for the United States to have a domestic automobile industry. Is there a man or woman alive who believes these will be automakers’ last requests for bailout money from Washington? GM, at least, has done a decent job of capturing market share overseas, so maybe that’s a framework for the company to reinvent itself. Chrysler is so diminished that I wonder if there’s any alternative except getting what’s left of the company ready for sale.

    Obama has abandoned plans to appoint a “car czar” to oversee government aid to the auto companies, giving the job instead to a high-level task force. So far, the president has declined to look a central question in the eye: Can GM and Chrysler ever thrive under present management? If the Big Three are not to shrink to the Big One—Ford is managing to survive on its own—Obama and Congress are going to have to oversee GM and Chrysler almost like a board of directors. Go ahead and laugh, but explain to me how even Washington could do a worse job with these two companies than Detroit is doing.


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    The auto industry problem is cheap and simple compared to what Obama faces in the financial sector. Thanks to an amendment that Sen. Christopher Dodd, D-Conn., inserted in the stimulus bill, Washington now has control over bonuses and severance packages at financial companies that have taken funds from the Bush administration’s $700 billion TARP bailout program: no more eight-figure bonuses for Wall Street “geniuses” whose cleverness helped drive their companies, and a good deal of the economy, into the ground.

    Dodd added a measure that makes it easier for firms that chafe at Washington-imposed restrictions—on compensation, for example—to pull out of TARP. The details are complicated, but what’s important is that banks and other financial institutions that are relatively healthy may well begin to leave the program. The impression would be that the firms remaining in the program are relatively sick—and people tend to be uncomfortable keeping their money in a bank that can be described as relatively sick.

    Treasury Secretary Timothy Geithner has fought against transparency in the bailout program that would let everyone see which banks have pneumonia and which merely have a cold. My belief is that the pneumonia-versus-cold distinction was bound to become evident, with or without the Dodd amendment. In any event, if one of our big banks was seen to be in danger of failing—becoming, in effect, a Dead Bank Walking—the Obama administration would have few choices other than to nationalize it.

    Then there’s the housing problem, which may be the most difficult of all. Foreclosures and plummeting home values are at the heart of the economic crisis. Either millions of Americans are going to lose their homes, or millions of mortgage contracts are somehow going to be modified. That’s not an attractive choice.

    All Barack Obama wanted was to be president. He may have to become an auto executive, a banker, a mortgage broker and who knows what else before this crisis is done.
    Eugene Robinson’s e-mail address is eugenerobinson(at)   

    © 2009, Washington Post Writers Group

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By applehepzi, March 25, 2010 at 11:50 pm Link to this comment

I like obama…......I’m not certain that he’ll get
another term. Occasionally I get a feeling things may
pull together just in time. The talent is out there –
I’m just not so sure of the principle needed to make
talent matter…....

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By Marlton NJ, December 13, 2009 at 12:21 pm Link to this comment
(Unregistered commenter)

“Rather than using the “trickle down” method lets give the people the “trickle up” method where a trillion dollars will be in the hands of the folks on the street”

This makes so much sense. How can the feds think that giving money to companies who mis-manage their business will now magically make the correct decisions just because they were handed billions of dollars. Putting more money in consumers pockets will have a greater spending effect than using the money to give a bunch of bad executives bonus pay.

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By larp weapons, October 31, 2009 at 11:34 am Link to this comment

GM and Chrysler need to look at Ford’s marketing strategy and ask themselves where they are lacking. It seems to me that if things are really bad in the auto industry and despite what the current administration is or is not doing, would not all three car makers be suffering? Ford certainly has planned well for the bad times.

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By wedding photographer, May 14, 2009 at 5:27 pm Link to this comment

“...Chrysler is so diminished that I wonder if there’s any alternative except getting what’s left of the company ready for sale.”

Today Chrysler announced the closing of almost 800 dealers across the country. Looks like your question is being answer about what Nardelli plans are. I feel bad for all those people who are now out of a job.

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By wildflower, February 17, 2009 at 7:57 pm Link to this comment

Re Tropicgirl’s Post – “I may be the first progressive liberal etc . . . etc . . . etc . . who now reads the conservative news now just to find out something objective about what is going on. . . etc.”

A progressive liberal that reads the conservative news to find out “something objective” about what is going on? Sorry, tropicgirl, but there is no way a progressive liberal could read conservative news/opinions for 28 days straight (Obama was inaugurated 28 days ago) and remain puke free for 2 hours let alone 28 days; and, then, there is the matter of maintaining one’s sanity.

As for Obama, he’s only been in office for 28 days so what do you expect? If you’re expecting instant gratification, I don’t think you’re going to get it, especially when you consider that for the past eight years your new love – the “conservatives” - have undermined this country in every direction possible: our economy, our military, our Bill of Rights, our justice system, checks and balance, laws, and our credibility as a nation.

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By tropicgirl, February 17, 2009 at 4:43 pm Link to this comment

Wildflower said… ” In addition to decreeing an end to torture and Guantanamo, extending health insurance to more children, reversing Bush-era policies on family planning,...

Hey dummies… If you look closely at this, Obama hasn’t really reversed the Bush administration at all on much of anything, especially the important stuff. He just talks about it and miserably fails at being transparent and even consistent.

I may be the first progressive liberal, but I believe not, who thinks that the decision in Afghanistan is the final straw with Obama. I now believe he is dishonest and will say ANYTHING.

The next protest I attend will be against him. I swear today. If I see another photo of him waltzing or Michelle on Bogue I think I will just scream. And I may not be the only one who now reads the conservative news now just to find out something objective about what is going on, that doesn’t puke Obama every day.

So, in the meantime, I will be standing aside watching and laughing at the complete side show in Washington, because its too painful to cry. At least now we may be able to actually see the poor, dead troops come home. Watch him try to censor that also.

Barry you sicken me. I wouldn’t trust you with a kindergarden class never mind the country.

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By Old Ed Of The Delta, February 17, 2009 at 2:45 pm Link to this comment

Just forget about products exclusively made and sold in the USA. We live in a one world economy like it or not.

As an example Caterpillar’s chairman and chief executive, Jim Owens states that 75% of company sales were made to buyers overseas this past year. He supports Obama’s stimulus package as long as it allows CAT to sell their equipment to anybody that has the cash or credit to buy it.

Therefore, if we don’t sell CAT products on a worldwide basis then the company must layoff 20,000 employees here in the USA. No improvements until 2010 maybe.

The FORD Motor Co. only profitable items was based on overseas sales this past year.

We have lost a significant amount of your blue collar jobs as they have been eliminated by sending the work to be done to factories overseas.

No amount of “stimulus” will work unless we have an hands on industrial base. The Fed. borrowing money and “lending” it to banks and financial institutions to keep them solvent will not work unless the money shows up the hands of the consumers that need goods and services.

Rather than using the “trickle down” method lets give the people the “trickle up” method where a trillion dollars will be in the hands of the folks on the street. Something like the Salvation Army Bell Ringers, but only in reverse where they hand you tax free vouchers payable on demand as you walk by. This way you keep your anonymity and self-respect.

One argument that I heard against the “truckle up” theory is that the masses are irresponsible and don’t know how to handle vast quanity of money.

Within a short period of time the money would be spent on drugs, alcohol, sex, etc. and would wind up in the tills of the merchants and bankers anyway.

Whereas the leadership of the financial institutions are more responsible and deserving than the lowly peasantry. These institutions cannot be left to fail under any circumstances as we would all starve to death in the resulting world conflagration and result in the end of civilization as we know it.

We had an industrial base 80 years ago that pull us through the Great Depression of the 1930’s. We don’t have that base now.

Building roads, bridges, dams, and parks are fine. But we must manufacture products that people can afford to buy through the efforts of their labor. Just sitting behind a computer in a cubical doesn’t cut it as we are becoming a nation of bookkeepers, lawyers, salesmen, Black Jack dealers and stockbrokers, instead of skilled and unskilled labors that create a tangible product used and consumed by the public

Let’s face it—not every Tom, Dick, Harry and Jane has the brain power to compete in this society or do they have the family influence to lift them up to the lofty careers and status enjoyed by their parents.

Luck has a lot to do with our station in life as exemplified by George W. Bush. “Bubba” was a failure in every enterprise that he participated in from his “tour” of duty in the Texas Air National Guard to that of President of the USA.

Here is a little food for thought: The beginning of the French Revolution Financial crisis and starting with the Assembly of Notables.

    August 20: Finance minister Calonne informs Louis that the royal finances are insolvent

    December 29: The Assembly of Notables is convoked (summoned).

    February 24: First Assembly of Notables meets against a background of state financial instability and general resistance by the nobility to the imposition of taxes and fiscal reforms.

Does this kind of sound familiar?

Old Ed of the Delta

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By felicity, February 17, 2009 at 1:08 pm Link to this comment

Well I guess now that the presidency has become an ‘imperial’ presidency, Obama has to single-handedly pull all this off?  (Listening to the carping on the ‘financial’ channel, Obama must undo (he’s had three months for God sakes) what the financial sector has spent years creating?)

And by the way, has Congress retired and I missed it or is it just maintaining its consistent irrelevancy.

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By prole, February 17, 2009 at 12:49 pm Link to this comment

“This is a presidency on steroids” i.e. artificially enhanced and over-hyped, not to mention unprincipled and unethical. “Barack Obama’s lack of action on Gaza alone would be enough malfeasance “for any new administration’s first month: decreeing” a further escalation in Afghanistan is too much.  An end to torture and Guantanamo were sufficiently vague to allow loopholes and a universal single-payer health insurance plan is off the table completely. “That the White House also managed to push through Congress a spending bill of unprecedented size and scope—designed both to provide” a windfall giveaway to greedy robber barons and reinforce the nation’s corporate imperial priorities — is little short of despicable…and predictable. Just as predictable is the fawning apologetics for the whole sorry spectacle by Robinson and the Washington Post Obama claque. “Now it’s time for the administration to get” the unsparing critique it’s deserved all along before any more lasting harm is done. But don’t count on any from the Democratic Party press agents at the Post. “For his next act, Obama must”… disappear! -along with Robinson- before he tries to “set the parameters of a new presidential role that” we “did not seek but cannot avoid: [his] managing the big chunks of the private-sector economy that are now more accurately described as” semiprivate publicly-subsidized corporate welfare boondoggles. “Maybe it’s just baby-boomer nostalgia for the car culture of my youth” – or maybe it’s just a cunning ploy to transfer more public wealth to private coffers, that both Obama and the Post have been relentless in advocating all along. “But I think it’s a good idea for the United States to have”...a comprehensive public transportation network that abolishes the destructive ‘car culture’ once and for all. Course that might impinge on some of the ad revenues at the Post, or Obama’s campaign contributions – but that’s only another good reason to do it. “Is there a man or woman alive who believes these will be” Robinson and the Post’s “last requests for bailout money from Washington?” Looks like Obama Copacabana is not the only corporate Uncle Tom in Washington these days.

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By wildflower, February 17, 2009 at 10:50 am Link to this comment

You’ve left out something, Eugene.  In addition to decreeing an end to torture and Guantanamo, extending health insurance to more children, reversing Bush-era policies on family planning, Obama has released all of those Republican parrots from their big cage behind the White House, which is going to make Obama’s job even more challenging.

Lets face it, these most of these Republican parrots are not low maintenance pets. They’ve been overly indulged by their former owners and are accustomed to being handfed and groomed daily – to say nothing of all of the toys and treats provisions provided by the former administration. The point is they’re not going to be much help in resolving the problems we face.

In all probability, they’re going to be a daily hindrance. As Obama and the rest of America tries to undo some of the damage the Bush/Cheney administration has created during the past eight years, these Bush/Cheney parrots are going to be flying wildly throughout the halls of Congress squawking madly and mindlessly the only words they’ve been trained to say - “tax cuts, “tax cuts for the wealthy.”

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By Purple Girl, February 17, 2009 at 10:40 am Link to this comment

Stop Referring to these Treasonous Corps as ‘Detroit’. Have you seen Detroit over the last 3 decades. Have you seen Flint.Those SOB’s left Michiganders like a used up dead hooker on Woodward in the ‘80’s!
The only thing those Assholes left behind were their HQ’s. God only knows how many factories are currently decaying into our Michigan Ghost town Soil.
If it weren’t for the Auto workers (our neighbors and our grandparents) we would have disowned the Big 3 long ago. Hell we would have burnt the HQ’s to the ground. the Big 3 HATES Michigan because we were the front lines to the Organized Labor movement.Although a Dying breed, we still have some orginal ‘White Shirts’ and Sit inners active in the Democratic party. We ahve been being Punished ever since- job layoffs, factory closures, always MI is on the list. Our parents and Grand parents BUILT those companies, CREATED the Middle Class, Set a standard for ALL workers for fair wages, benefits, retirement plans and safe working conditons. If it weren’t for the Early auto workers,We’d ALL be still Sweatshop slave labor, including those white collar middle management.
The Auto Worker, the UAW would have Assembled anything coming down the Line, Including an electric car, or any other alternative fuel propelled vehicle. Hell they’ll assemble solar panels, wind mills, Anything.
But we Refuse to allow the suffering and struggle of our ancestors to have been in vain. They didn’t do it for themselves, or even Just their Kids…they did it for All American Workers so that WE would never have to be slave labor like so many other countries workers.
Michiganders Don’t Love the Big 3, We love our country and our fellow citizens and Expect Our Companies and Our gov’t to Live Up to the promises and aspiration of our Founders (and immigrants) dreamed of- “For the People and By the People” . Not ‘for the Elite and By the Corps’
Don’t refer to the Big 3 as ‘Detroit’ when it has been MI who has been the most devastated victims of their most heinous crimes against U.S.

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By Michelle Hodgin, February 17, 2009 at 8:58 am Link to this comment
(Unregistered commenter)

Whenever I think of Chrysler, I get a very bad feeling because of Nardelli.  He screwed Home Depot (a once great company)and shareholders out of a lot of money! What is he going to do to what is left of Chrysler, shareholders and the American public this time?

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By thebeerdoctor, February 17, 2009 at 4:07 am Link to this comment

Fairy tales can come true. It can happen to you. If you are among the very young at heart…

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