Green: Auto bailout stalls the inevitable

Most people already know that the U.S. automobile industry is dying. Forbes Magazine’s… Most people already know that the U.S. automobile industry is dying. Forbes Magazine’s assessment of Detroit as ‘America’s Most Miserable City’ was just a couple extra gallons of salt on already festering wounds. Now General Motors and Chrysler LLC, which received a combined total of $17.4 billion in federal loans, must attempt to persuade the Obama administration that the companies have a viable future ‘mdash; or else the government could withdraw its loans and leave the industry to drown in its own refuse ‘mdash; that is, warehouses upon warehouses of oversized, over-oiled and overpriced SUVs. Accepting the always-coveted role of the ‘deciders,’ Treasury Secretary Tim Geithner and National Economic Council Chairman Larry Summers were appointed by President Obama to lead what’s being called a ‘presidential task force on autos,’ a sampling of officials across several government agencies that seeks to provide advice and analysis about the auto industry, according to the Washington Post. This decision deviates from Obama’s original plan to appoint a lone ‘car czar’ to oversee the restructuring of the industry. But I’m weary of the ultimate decision to create a task force, for two reasons. First and foremost, I’m rather disappointed by the lack of a car czar, especially because the Obama administration took the time to make it rhyme and everything. And it undoubtedly would have garnered the sweetest business cards ever. Second, seriously, don’t Geithner and Summers have other things to worry about? Like maybe, I don’t know, the banking crisis? And since when are they the ultimate authority on the auto industry? Not that I doubt the economic knowledge of either Geithner or Summers ‘mdash; though it has to be said, last year wasn’t really a resume builder for either one ‘mdash; but the idea of a car czar made sense to me: Someone could devote all of his attention to the problems plaguing the automobile industry. These are big problems. For years, American-owned auto companies have struggled to compete against the cheaper and more progressive foreign-owned companies like Toyota and Honda. In the last year, thanks to your friendly neighborhood recession, U.S. auto profits are hurting more than ever. According to MarketWatch.com, as of December, sales of all automobile companies had reached record lows. Chrysler, like a broken and wet dog, led the pack ‘mdash; its sales were down a colossal 53 percent from last year. GM fared slightly better with sales down just 31 percent. With or without a car czar, one has to wonder how GM and Chrysler can feasibly turn around those numbers, especially in a short period of time. One might say, when a company ‘mdash; or entire industry ‘mdash; reaches rock bottom, it can only go up. Except, I’m pretty sure the auto industry can get worse. Though I can’t help but think, ‘This is what General Motors gets for creating the Hummer,’ I also recognize the importance of a U.S.-owned auto industry’not; ‘mdash; namely, American jobs. According to Obama adviser David Axelrod, ‘One thing is clear ‘mdash; really two. We need … an auto industry in this country. ‘There are millions of lives, livelihoods that depend on it. Not just at the auto companies, but spin-off manufacturers, dealers and so on. We have a real interest in seeing the auto industry survive,’ he said on NBC’s ‘Meet the Press.’ Predictably, Axelrod couldn’t specify how to save the auto industry, only saying that it would ‘require sacrifice not just from the auto workers, but also from the creditors, from the shareholders and the executives who run the company. Please note the overall vagueness of this quote. Meanwhile, according to The New York Times, Obama has still not ruled out the possibility of a government-backed bankruptcy. While this might seem drastic to some, in a state of economic uncertainty, it goes without saying that nobody 100 percent knows which direction would prove most beneficial, and we must at least be prepared for this option. Until then, I leave you with this image: Rain pounds against a dirty, desolate Detroit highway. The streets are abandoned, save for a lone broken-down Volkswagen Beetle. It’s everyone’s favorite ‘Love Bug,’ Herbie. In a horrible wail, Herbie cries a single window-wiper-fluid tear for the ravaged automobile industry, its heart more broken than Lindsay Lohan’s acting career. Did you love ‘Herbie Fully Loaded’? Chat about its surprise ending with Molly at mog4@pitt.edu.