Obama Wants Car Czar to Accompany Big Three Aid

More details of a possible Obama administration-led auto industry bailout emerged yesterday when Politico reported that the president-elect wants a "high-profile point person to oversee reforms" attached to any financial aid.

Specifics about the proposal remain unclear. But the transition team
says Obama suggested to President Bush on Monday that aid to the auto
industry could be coupled with the appointment of "someone in charge of
the auto issue who would have the authority" to push for reforms. The
details came from a more extended readout of the White House meeting
provided Tuesday.

It will be interesting to see how this proposal plays in Detroit, where resistance to change, even in the marketplace it serves, may be the biggest contributor to its current predicament. In the meantime, how might the next president balance his union sympathies and urban policy cred in the name of auto industry "reform"?

  • Larry Littlefield

    Hey Obama, how about a mere $500 million to subsidize the wholesale purchase of 2 million fully-outfitted commuter bikes at $250 apiece? (That price is certainly possible for next year due to the deflation taking place on a global scale).

    The money comes back as the bikes are sold — If people don’t have the full retail price they can pay the $250 back over time.

    If you can bail out the auto industry in exchange for a gauzy promise of fuel efficient cars, why not making sure plenty of transport-appropriate bikes are available?

    Also, if the govenment is going to force people to subsidize the Big Three, how about ordering 10% of the most fuel inefficient (and dangerous for small car drivers) SUVs off the road every year, starting with the oldest, thus forcing the owners to buy new cars? Or perhaps do without them.

  • The car-making states are blue states, so Obama is just doing what politicians do — keeping the home fires burning. Let’s wait for the inaugural and state of the union addresses to see to see how this fits into the big picture.

  • Jerry Reid

    There is plenty of profitable car-making going on in the southern states by a number of different companies (VW, Toyota, and Honda come to mind). I think the reason the Big 3 are in such trouble is that they have spent decades dispensing unsustainable wage and benefits packages to union members. This is a good deal if you are in the union, but maybe not if you’re a taxpayer.

    Those car makers who don’t have unionized work forces seem to be in far less economic pain and they pay good wages, too. Just not union level wages, with health benefits that extend to the grave.

  • Niccolo Machiavelli

    Well, where the union sympathies and the urban policy meet is in the rust belt. Another reason those southern factories are so efficient is they are way out in the wide open spaces, Detroit smokestacks are in River Rouge, Flint and the rotted urban core, likewise Chicago’s. The one floor operations that generate employment in the exurbs also generate housing and travel in the exurbs. Pushing development, employment and industry, back to the urban core turns this around. Japanese and German auto workers take mass transit to the plant.

  • vnm

    An automaker bailout comes with strings attached. Just ask AIG: As soon as a company takes taxpayer money, taxpayers have the moral authority to help set the direction for the company.

  • Well, if Obama and Secretary Oberstar can then dictate that these car companies start making more and cheaper trolleys, buses and trolleybuses, then I guess that’s good. But it’s a big if.

    I don’t agree with the blanket union-bashing in some posts. I think the UAW has been wrong in clinging to auto manufacture as the best source of work for their members. But in general I don’t think there’s anything wrong with collective bargaining. Capital uses a hierarchical structure to accomplish its goals, why shouldn’t labor?

  • Ian Turner

    When employers collectivize in the way that unions do, we properly call it collusion and it is illegal.

    It’s true that the natural state of things give more power to employers than to employees (also more to lessors than to tenants), and that unions can help to reverse that natural tendency, but the state of unions in the United States is appalling.

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