Geithner -- Moving from Treasury to Car Salesman?

What's happening here? Ron Geithner was appointed Secretary of the Treasury despite an inability to pay all his taxes. Obama is evidently unhappy that he stuck with Geithner after several other cabinet nominees backed out after the public learned they too had tax payment embarrassments.

Then Geithner fumbled. A big game-changing fumble. He -- and Obama -- promised the nation a comprehensive plan to save the banking system. Instead Geithner bumbled and honked his way through a presentation that merely promised that someday a plan -- a plan he admitted would include its share of mistakes and missteps -- would emerge. But not yet; too soon. These things take time. Okay, and we know that. So why did he and Obama promise the unveiling of a plan last week when devising the necessarily brilliant strategy would take more time? Looks like good old-fashioned incompetence.

What to do? Fire Geithner? Replace him with Larry Summers? Aha. Give him the job of selling cars. Obama promised us a Car Czar. The title is troubling. Where did the czars live? Mother Russia. Going down the czar route suggests that US industry, like the Russian workforce, will march into a Marxist future. Thus, Obama scrapped that idea. Obama is now proposing to create a committee to oversee the Detroit Auto industry. Hmmmm. A committee. In Washington. We're starting with a central-planning committee for the auto industry. And Obama wants Geithner to head the committee. Instead of a tyrant ruling over the Detroit auto industry from a government post hundreds of miles from the factories, Obama wants to create a team of faceless bureaucrats to plan the moves of this once major domestic industry.

Meanwhile the czar concept has fared poorly in other government efforts. We've had a Drug Czar for a long time. That czar heads the Office of National Drug Control Policy, and Obama is about to appoint a new man to the post. R. Gil Kerlikowske, chief of the Seattle Police Department. He's the next person to fail in the War on Drugs. The Police Chief is best known for leaving his Glock automatic pistol in his unlocked car. It was stolen. What happened? The Seattle Police Department issued a statement saying the Chief had not violated any department policies by leaving his weapon in his car. A cop who forgets his gun? He seems well qualified for the job of Drug Czar.

Running one auto company is a full-time job. However, Obama has decided Geithner can spare the time to run all three US carmakers. With the help of a committee. Obama's conclusion that managing the three US car companies is a part time job for the US Treasury Secretary says -- loudly -- that Obama is clueless about the complexities of big enterprises in the US. This is another example of his comtemptuous look down his nose at the people who operate America's businesses.

Rather than admit he bungled this episode, Obama seems to have decided he will push Geithner aside, putting him in command of at least one "special project" that will expand from a part-time job into a full-time job. Obama now knows Geithner is in over his head. Thus, he's got to go. Unfortunately, the community organizer now serving as president is also in over his head.

Both the Drug Czar and the Car Czar are people who are expected to hold back the tide. Drug use is part of American Culture. If Washington were operating in a sane and rational manner, policies would reflect the fact that it is impossible to stop the use of drugs now classified as illegal. We need a new approach that reflects the world in which we live. The same is true for the Car Czar. The Detroit Auto Industry is heading for bankruptcy. Not extinction. Just bankruptcy. The country and the industry can withstand Chapter 11 bankruptcy filings by the three members of the domestic auto industry. But the companies, as they are currently configured, are past the point of recovery.

It's too late to save them with the series of maneuvers and tactics that management is employing. Worse, the United Auto Workers have balked at the latest changes sought by management. It seems the UAW believes that threatening management will bring customers into showrooms and put revenue on the top line. What can a Car Czar do but arrange for more taxpayer money to flow Detroit's way while unsold cars accumulate in factory lots.

To Fix Detroit, Obama Is Said to Drop Plan for ‘Car Czar’

DETROIT — President Obama has dropped the idea of appointing a single, powerful “car czar” to oversee the revamping of General Motors and Chrysler and will instead keep the politically delicate task in the hands of his most senior economic advisers, a top administration official said Sunday night.

Mr. Obama is designating the Treasury secretary, Timothy F. Geithner, and the chairman of the National Economic Council, Lawrence H. Summers, to oversee a presidential panel on the auto industry. Mr. Geithner will also supervise the $17.4 billion in loan agreements already in place with G.M. and Chrysler, said the official, who insisted on anonymity.

The official also said that Ron Bloom, a restructuring expert who has advised the labor unions in the troubled steel and airline industries, would be named a senior adviser to Treasury on the auto crisis.

The unexpected shift comes as G.M. and Chrysler race to complete broad restructuring plans they must file with the Treasury by Tuesday. The companies’ plans are required to show progress in cutting long-term costs as a condition for keeping their loans.

The administration official said the president was reserving for himself any decision on the viability of G.M. and Chrysler, both of which came close to bankruptcy before receiving federal aid two months ago.

One of President Obama’s top advisers said Sunday that the administration had not ruled out a government-backed bankruptcy as a means to overhaul the automakers.

“We’re going to need a restructuring of these companies,” the adviser, David Axelrod, said on “Meet the Press” on NBC. He added that a turnaround of the companies would “require sacrifice not just from the auto workers but also from creditors, from shareholders and the executives who run the company.”

The automakers had been expecting the appointment of a car czar to break the logjam of negotiations with the United Auto Workers over the finances of a retiree health care trust, and with bondholders about reducing the companies’ debt.

Mr. Bloom is known for bringing his Wall Street experience as an investment banker to an advisory role as the “in-house” banker for the steel workers’ union. With the auto union locking horns with bondholders in the G.M. revamping deliberations, Mr. Bloom appears to bring credibility with both the union and the debtors. Mr. Bloom could not be reached for comment Sunday night.

Another senior administration official said that Mr. Obama had considered appointing a car czar, and among those considered for the job was the private equity executive Steven Rattner. It was not clear why the administration changed course or whether Mr. Rattner would have a role on the task force.

The panel, called the Presidential Task Force on Autos, will draw officials from several agencies including the departments of Treasury, labor, transportation, commerce and energy, according to the administration official.

Many members of the task force have already been working closely with G.M. and Chrysler on the viability plans they are preparing for the government.

G.M. and Chrysler are both expected to request more loans to stay solvent during what is shaping up as another miserable year for auto sales.

Chrysler’s chairman, Robert L. Nardelli, has said his company needs another $3 billion in addition to the $4 billion loan it received in January.

G.M. originally asked for $18 billion in aid in December. G.M. has borrowed $9.4 billion so far and is scheduled to receive another $4 billion, if the Treasury is satisfied with its revamping plan.

G.M. said in a statement that it welcomed the new task force and that it looked forward to sharing its plan “to restore our company to viability and to meet the requirements of its loan agreements.”

Representatives of Chrysler could not be reached for comment on Sunday night.

The administration official who disclosed the change in Mr. Obama’s plans for oversight of the auto industry said the group would review the companies’ submissions for a week or two before responding publicly. Until then, the auto makers are expected to continue talks with the union and other stakeholders.

On Sunday afternoon, G.M. and the U.A.W. resumed discussions in Detroit about reducing the company’s labor costs, a person with direct knowledge of the talks said. This person, who spoke on condition of anonymity because the discussions are private, characterized the talks Sunday evening as “intense” but did not indicate that an agreement was imminent.

The U.A.W. had walked away from the bargaining table late Friday as the two sides clashed over how to cover retiree health care costs.

U.A.W. leaders in December agreed to help the automakers by delaying when the companies are required to make multibillion-dollar payments into a new trust fund designed to pay for retiree health coverage.

The Ford Motor Company is not taking federal aid, and therefore does not need to submit plans for approval. But Ford, which lost $14.6 billion in 2008, the most in its history, is expected to ask the U.A.W. for whatever concessions are granted to G.M. and Chrysler.

Both G.M. and Chrysler are likely to outline deep cuts in jobs, plants and models in their restructuring plans. One G.M. executive said the automaker is proposing a much smaller company with fewer brands and far fewer people.

G.M. and Chrysler recently extended buyout and early retirement offers to nearly all of their 90,600 hourly workers as they try to eliminate factory jobs and replace older workers making about $28 an hour with new hires who can be paid half as much.

G.M. announced plans last week to cut 10,000 white-collar jobs worldwide, including 3,400 in the United States. It said that salaries for those who remain on staff would be cut by as much as 10 percent through at least the end of 2009.

Over all, automakers are expected to sell between 10 million and 11 million vehicles in the United States this year, far below the 16.2 million they sold in 2007. G.M. said last week that the two-year drop is roughly equal to the capacity of 24 assembly plants.