early and often

What You Need to Know About the Auto-Industry Bailout

It was always pretty clear that something needed to be done to save the Big Three American automakers; the question was simply how disagreeable the eventual bailout would be. But after numerous hearings and fervid demands that car-company CEOs repent with symbolic gestures, Congress has nearly settled on a plan. As it stands now, a $15 billion loan, paid out of a fund previously allocated to implementing fuel-efficient technology, will be given to the struggling car-makers. In exchange, the companies will have to submit detailed restructuring plans by March 31 that show how they’ll transition to long-term viability and pay back the loans. A powerful “car czar” appointed by President Bush will be tasked with overseeing the entire process. So, who’s thrilled? Anyone? Bueller?

• Chuck Todd and friends are struck by how supposed lame duck President Bush is basically “getting his way” in this deal. He didn’t want the bailout money to come from the TARP funds, which it won’t, and he gets to appoint the “car czar.” [First Read/MSNBC]

• Ezra Klein wonders why the Democrats are making the “strange decision” to put the loans “under the supervision of a single Bush appointee who hasn’t even been named.” Maybe they “don’t want to be the bad guys demanding concessions from the UAW and facing heat from the full Labor movement.” [American Prospect]

• Jonathan Cohn thinks that a critical issue is how to actually establish “the right standards for measuring the companies’ restructuring progress.” [Plank/New Republic]

• Mickey Kaus believes a bailout should “include an explicit reopening of labor contracts.” This would create “a useful precedent for Obama” by setting a “cautionary precedent” for other unions. “Does he really want to have to bailout every slow-adapting union that’s contributed to the Democratic party’s victory?” [Kausfiles/Slate]

• David Sanger notes that the plan moves us not only toward the model of the “Japanese Ministry of International Trade and Industry in the 1970s and the 1980s,” but also the current Chinese “mix of capitalism and state control.” [NYT]

• Marc Ambinder writes that “one of the biggest concessions that Democrats seem to have wrung out of Detroit is a promise to drop their lawsuits against state governments trying to get them to curtail greenhouse gas emissions,” which Republicans feel is “toxic” because “it would essentially allow 16 states to have a veto over the automakers’ internal manufacturing processes.” [Atlantic]

• Allahpundit suspects that congressional Democrats will allocate however much money it takes to keep from “dumping auto workers into the unemployment bin come spring” so as to not “compound The One’s economic headaches/approval.” [Hot Air]

• Jay Newton-Small notes that because of either “donor fatigue or anger that the Big Three to a large extent brought this upon themselves, there simply isn’t the political will in Washington to pass a comprehensive rescue plan.” Which is why even this temporary fix is surely “one of the least popular votes of the year.” [Time]

The Wall Street Journal’s editorial board suggests that maybe the Ford Foundation use some of its $13 billion in assets to bail out the auto industry, hmmm? [WSJ]

• Nick Gillespie would just like to point out that Congress really shouldn’t be using the term czar, “a terrible word to use for any office. The czars (and czarinas!) were terrible rulers who presided over one of the biggest ongoing failures in human history (a.k.a. Czarist Russia).” [Hit & Run/Reason]

What You Need to Know About the Auto-Industry Bailout