Tuesday, February 17, 2009

Does auto task force trump a car czar?

By James R. Healey, USA TODAY
From a "car czar" who could have micromanaged the foundering auto industry, for better or worse, Detroit automakers now will be delivered into the hands of a committee, the White House says.
The Presidential Task Force on Autos — its members not yet named — will consist of representatives of nine governmental agencies and the White House, and will be run by Treasury Secretary Timothy Geithner and White House economic adviser Lawrence Summers.

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"The task force lets us use the experience of many people across government," spokesman Robert Gibbs said Monday. "I don't think that one (czar) vs. several people is a problem."

About the only thing such a committee could do is guide automakers "through bankruptcy or bankruptcy-like proceedings," says Barry Hirsch, professor of economics at Georgia State University. "It is too late for this comprehensive restructuring to take place through negotiation and voluntary agreement among the stakeholders."

General Motors (GM) and Chrysler, already living off government loans, must file plans Tuesday to show how they would remain viable if the government lends them billions of dollars more.

If the government gives the go-ahead, the committee overseeing the automakers' plans will have representatives from the departments of Treasury, Labor, Transportation, Commerce and Energy, as well as from the National Economic Council, the White House Office of Energy and Environment, the Council of Economic Advisers and the U.S. Environmental Protection Agency.

The Treasury secretary will oversee loan agreements.

When GM and Chrysler sought — and got — emergency federal loans late last year, Congress envisioned a powerful person called a car czar to ride herd on automakers' decisions. The czar would ensure that the interests of taxpayers are protected.

While there was some worry that so powerful an overseer could meddle in car companies' daily affairs, Detroit automakers agreed that a single, decisive official could be helpful.

No czar ever was named. Now, the size and makeup of the Obama administration's task force makes skeptics wonder if such a group can make the quick decisions Detroit needs to stay afloat, and can avoid politics and interagency turf wars....More

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