Rattner's memoir opens curtain on auto bailouts

There's a lot more to chew on in this story. Click to see it all: Rattner's memoir opens curtain on auto bailouts.

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The Obama administration vetoed attempts by General Motors to abandon its Detroit headquarters, a new book by a former top auto adviser reveals....

Rattner acknowledged that Detroit's automakers weren't entirely to blame.

"I would discover that the struggles of GM and Chrysler were as much a failure of management as a consequence of globalization, oil prices, and organized labor," he writes.

"The auto rescue remains one of the few actions taken by the administration that, at least in my opinion, can be pronounced an unambiguous success.

"Detroit should count itself lucky."

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[[This preceded the Fouts reaction.)

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The president, Rattner says, was concerned by the decision to allow ousted GM CEO Rick Wagoner to collect $7.1 million of the $22.1 million he was owed in accrued pension benefits.

Wagoner was dismissed from GM in March 2009.

"I could see the president's jaw muscles tighten," Rattner recalled.

Obama had difficulty with the "notion of writing a check that was about 100 times the annual income of a GM worker to the CEO who had brought the company down."

The president, he said, "grimaced and reluctantly acquiesced. I found it striking that the president of the United States had spent more time on an issue of executive pay than on the question of whether to dismiss a major CEO in the first place."

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Finally. A reaction against the perpetually-growing executive/worker pay ratio by someone with muscle in this country. But he acquiesced? Not enough muscle? :confused:

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Marchionne, according to Rattner, told Gettelfinger about the need to accept a "culture of poverty" rather than a "culture of entitlement," attacking, among other things, retiree health care benefits.

Gettelfinger responded angrily.

"Why don't you come and sit with me and tell a 75-year-old widow that she can't have surgery and that you killed her husband?" the union chief retorted.

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Dayum! There's some drama right there! :eek:

According to Rattner's book, during the early debate on whether the administration should even try to rescue GM and Chrysler, Rahm Emanuel's response was "Fuck the UAW!"

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The White House even commissioned an outside analysis of the impact a move would have on Detroit property values, Rattner wrote. The answer: an estimated "double-digit hit on already deflated real estate prices."

Leaving the RenCen "made a lot of strategic sense," Rattner wrote. But Michigan native Gene Sperling, a U.S. Treasury Department official, was one of many who fought the idea.

"It's over for Detroit if you do this," Sperling yelled in a meeting, Rattner recalled. "Don't do this to [[Detroit Mayor) Dave Bing... He's a good man trying to do a good thing."

The request was passed up the chain to White House Chief of Staff Rahm Emanuel, "and word came down that the move would be a bridge too far," Rattner wrote.

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No doubt this book will be a big seller in Detroit!

Rattner is an idiot.

Why is he writing a memoir so soon and shooting his mouth off about a huge issue that is still warm. He comes across to me like an egotistical moron who likes to believe he is the savior of the US Auto industry. Perhaps he should've waited until everything is said and done, after GM goes public and after all this is in the past.

I don't understand why it is coming out so soon other than he is trying to cash in on this ordeal.

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Originally Posted by DTWflyer

Rattner is an idiot.

Why is he writing a memoir so soon and shooting his mouth off about a huge issue that is still warm. He comes across to me like an egotistical moron who likes to believe he is the savior of the US Auto industry. Perhaps he should've waited until everything is said and done, after GM goes public and after all this is in the past.

I don't understand why it is coming out so soon other than he is trying to cash in on this ordeal.

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I think your last statement says it all..... $$$$

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Originally Posted by DTWflyer

Rattner [[...) is trying to cash in on this ordeal.

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I imagine so.

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Originally Posted by Jimaz

No doubt this book will be a big seller in Detroit!

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This is going to be huge. Not just because I'm buying a copy.:p But because of the elections. And Obamacare/socialism/Government Motors, that whole thing.

If Obama's crew can send the fifth fleet to solve a problem in a foreign country somewhere in the Persian Gulf, then they can sure call the shots on GM and Chrysler as far locating premises in metro goes. Especially to the tune of 85 billion. As real estate agents say, for that kind of money; it's all about location, location, location...

From today's Auto bailouts chiseled out of conflicts and tension:

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Bondholders were stunned when they realized they'd lose out in Chrysler's restructuring under bankruptcy, while a UAW trustee would emerge as the majority shareholder.

"Jimmy became apoplectic," Rattner writes, referring to the bondholders' representative, J.P. Morgan Chase Vice Chairman James Bainbridge Lee Jr.

"He demanded to know why the UAW should get any consideration, since it was well below the banks on the priority list of who would get paid in a bankruptcy. Ron [[Bloom) responded to that, bluntly telling him, 'I need workers to make cars, but I don't need lenders.' "

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It's hard to argue with that kind of common sense.

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Originally Posted by Jimaz

From today's Auto bailouts chiseled out of conflicts and tension:It's hard to argue with that kind of common sense.

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The problem is that it only works once. Next time Chrysler goes to the banks for money, they might be told to get screwed.

It tells a lot about Rahm Emanuel though. The guy is a toal asshole to the highest degree.

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Originally Posted by fryar

This is going to be huge. Not just because I'm buying a copy.:p But because of the elections. And Obamacare/socialism/Government Motors, that whole thing.

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I wish this was '12, not '10, to have a good debate on this policy issue.

I'm with Willam C. Ford, whom I believe, was quoted as saying or implying if GM had gone under that the domestic automobile industry [[GM, C, and F) might have gone under.

If GM had gone under, I assume C might have also. Even if only GM went under, I believe the supplier network would have folded their tent and that would have severely hurt, perhaps fatally, Ford.

I just don't know how to have this debate without a debate between Obama or Biden and their GOP counterparts.

This is a serious question which I'd love to see debate.

Some call it "Government Motors". I call it backstopping an economy headed into the toilet.

BTW, I was sititng in a GM dealer back in December when Bush authorized the loan to GM to keep them up and running [[kicking the can down the road to Obama). I was in the waiting room watching the President on CNN and also the owner of the dealer was there too.

He knew what was at stake. :eek:

If GM had gone under, some might have had a new name for Bush, George Walker H[[oover) Bush.

I have always wondered about what would have happened had GM and Chrysler went under....and by "under" I mean liquidated and gone. A lot of people tend to downplay what could have happened saying that the transplants could have easily picked up the pieces.

People say Henry Ford created the middle-class with his 5 dollar a day jobs and GM and Chrysler followed suit. Had GM and Chrysler were allowed to fold, I believed we would have been witness to the destruction of the middle-class in America. We would have gone back to a period in America when you truly had the rich and the poor, period. Everyone from insurance companies to your local strip joints like Flight Club would have folded like cardboard without plant workers, tradesmen, janitors.

emu steve, why would you call Bush "H[[oover)"? Because he was the President of his frat like in Animal House? As unpleasant as he was, you can't lay GM croaking at W's . My brother couldn't get a bail out after his P.O.S. Aveo[[Korean badged) ripped its own engine apart & rush hour on the Pomona Freeway. GM doesn't even want to cover the locks that inexplicably quit working. He won't be @ his Chevy dealer next time out, you can't stop everybody out here with their Japanese, German, Italian & Korean jalopies.

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Originally Posted by Patrick

It tells a lot about Rahm Emanuel though. The guy is a toal asshole to the highest degree.

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Why would you say that? What is he saying that the International Market hasn't? In a 45 minute drive i can get a Double-Double, Animal Style @ the spot where they made Camaros, what the hell happend to the guys that work there? You don't suppose they went down the I-5 to General Motors maquiladoras in Tijuana? If it makes the DetroitYessers feel any better the developer of "The Plant" is Detroit's own Tom Selleck & family,
http://www.gm.com/corporate/responsi...dy_vannuys.jsp
http://www.iam250.org/mexico/welcome-to-nafta.html

While we're @ it i can go to the old SkunkWorks site & get a dozen Krispy Kremes or some decent bourbons from Bevmo. I'd hazard a guess that U-2's & Lightnings & Shooting Stars were a bigger boost to the local economy than the booze & donuts tho Hell-there's probably just as much productuon back there as there used to be in Burbank.
http://www.laalmanac.com/transport/tr05.htm

GM & C folding would have wiped out a ton of jobs, I completely agree with that.

I'm kind of amused that Rattner's project, the GM/C bailout, is the only thing the Obama administration got right - 100% right, in fact, it's "an unqualified success." Really, why don't we just make him President, you know? ;-p

I usually try to avoid flamming on boards even to public officials who folks believe are 'free game'.

The point I was making about G. W. H[[oover) Bush is that Hoover will be linked with the depression as long as we have American history. Carter with the Iranian hostage crisis.

Bush would be linked with the demise of GM.

I'm old enough to remember the saying [[Okay it was said to me): "What's good for GM is good for America".

GM isn't a textile mill or a steel mill.

It is a 'symbol' of American manufacturing. Maybe THE symbol of American manfufacturing.

GM shuttering plants would be an image which would be remembered for decades and it would be the 'image' of the Great Recession and the decline of American manufacturing.

I can't say how much 'blame' Bush had for GM's problems other then there was a 'Great Recession' which started on his watch. Bush had been in office over 7 1/2 years so his watch had a lot of time on it.

One last point.

Policy wonks debate whether a dollar given to the poor, or small businesses [[tax credits) or to the 250K+ crowd does the most for the U.S. economy, but there is NO doubt in MY mind that saving the domestic automobile industry was the best usage of Federal money.

I believe for every dollar the Federal treasury spent on the automative industry we'll see savings of 10 or 20 times or more.

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Originally Posted by emu steve

The point I was making about G. W. H[[oover) Bush is that Hoover will be linked with the depression as long as we have American history. Carter with the Iranian hostage crisis.

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Herbert Hoover and Jimmy Carter were two of the best educated and most decent people ever to be elected president. Of all of the 20th century presidents these two gave the most service to the country in the years after their presidency. Both happened to be in the wrong place at the wrong time.

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I can't say how much 'blame' Bush had for GM's problems other then there was a 'Great Recession' which started on his watch. Bush had been in office over 7 1/2 years so his watch had a lot of time on it.

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Bush inherited a recession [[which was obscured by the dot-bomb bubble} and both 9/11 and Enron compounded his economic woes. The country pulled out of that recession and wasn't doing bad until his final year in office when things went to hell in a hand basket. During the Bush term in office, the US auto industry sucked even in the good times.