"Do I even need to say it?"
Posted on 10/21/2009 12:39:50 PM PDT by CutePuppy
Shockingly poor financial management at General Motors and Chrysler weakened their case for a federal bailout, but officials feared letting them collapse, the former head of a government auto task force said Wednesday.
In a first-person account posted on Fortune magazine's Web site and in a Brookings Institution speech, Steven Rattner said he was alarmed by the "stunningly poor management" at the Detroit companies and said GM had "perhaps the weakest finance operation any of us had ever seen in a major company."
GM's board of directors was "utterly docile in the face of mounting evidence of a looming disaster" and former GM chairman and chief executive Rick Wagoner set a tone of "friendly arrogance" that permeated the company, Rattner wrote.
"Certainly Rick and his team seemed to believe that virtually all of their problems could be laid at the feet of some combination of the financial crisis, oil prices, the yen-dollar exchange rate and the UAW," Rattner wrote.
Rattner described his six-month stint leading the Obama administration's auto task force, which pushed GM and Chrysler into quick bankruptcies last summer with the help of billions of dollars in federal aid. The task force won concessions from the union, suppliers, bondholders and dealers, and the U.S. government now owns nearly 61 percent of GM and 8 percent of Chrysler.
Rattner said at the National Press Club that he, along with Treasury Secretary Tim Geithner and White House economic adviser Larry Summers, "hated the idea of the U.S. government owning equity in these companies" but they concluded the government needed to protect taxpayers.
"It was frustrating that many commentators were suggesting that the government stay on the sidelines and let the companies fend for themselves," Rattner said. "With financial markets still frozen, both would have unquestionably run out of cash quickly..."
(Excerpt) Read more at breitbart.com ...
How is spending taxpayers money to bail out UAW is "government needed to protect taxpayers"? "With financial markets still frozen," why is then he denying the same excuse to Rick Wagoner (who deserved to be fired, if for no other reason than he should have talked the GM board into filing bankruptcy before the bailout mess)
If UAW was / is not the main problem of domestic car manufacturers, then why are they profitable and doing pretty well in Europe, South America and Asia? Why, before financial crisis, every "foreign" car company doing business and building cars in the USA was profitable under the same conditions sans union workforce, in other states, instead of bleeding red ink ?
And so on, and so on...
IOW's, Wagoner's Fault! GWBush should be happy that he isn't taking the fall, for once.
Barry is cleaning up Bush’s mess that Barry and the Dems voted into law. It’s still Bush’s fault? Yup \rhetorical
I know a former Chrysler employee.
He doesn’t know of any way that Chrsler will survive.
This analysis of the state of two of the worlds largest manufacturing companies comes to you (via his six-month stint in the Obama Administration) from a former New York Times reporter...
Yes, I said “reporter”. And, not to say he may not have learned finance, but his opinion about car companies should be taken with about as much salt as say, a movie review by John DeLorean....
PS: The free market has a way of resolving bad management issues, but Obama interfered...
"Do I even need to say it?"
Yet Ford is chugging along...
They don’t get the fact that they could produce the greatest automobile ever (I know, let’s pretend) and sell it for a dollar, but people like myself will never even consider buying a car from Government Motors.
As an owner of GM (taxpayer) I would like to see a quarterly report.
GM sales have continued to plummet and this week they announced plans for a $364M expansion of a Marion, IN plant.
How much tax payer loot is going down this hole?
GM and Chrysler should have been allowed to die. No one would have missed their cars, as few people were buying them anyway.
GM was mismanaged for decades.. easy money had allowed systematic arrogance and idiocy. While they improved efficiencies on the production floors through R&D and Automation, their management bloated to absurdity.
I don’t know if this is an accurate representation of the state of the companies, or just another case of Obama throwing people under the bus to hide their own failings.
In this case, it could well be both. But it is very convenient for the administration to have their own guy saying that the companies continuing failure is because of the mess Obama inherited when he took them over, rather than a result of government being incompetent to run a private business.
Well, Barry and his Fascist team got their task completed — UNION PAYBACK. Obviously, the future of the companies was and is of no concern.
Welcome to a preview of a fascist-driven socialist America.
“...Steven Rattner said he was alarmed by the “stunningly poor management” at the Detroit companies and said GM had “perhaps the weakest finance operation any of us had ever seen in a major company.” GM’s board of directors was “utterly docile in the face of mounting evidence of a looming disaster” and former GM chairman and chief executive Rick Wagoner set a tone of “friendly arrogance” that permeated the company,”
The same could be said of the current management of the US economy.
That huge sucking sound is the vast vortex pulling cash out of all other potential financial ventures, and depositing it is the coffers of a few politically well-connected agencies, which then re-funnel the proceeds into the re-election campaigns of the same folk who started the funneling in the first place.
These are low-lifes feeding on the dung of the vultures that have been feeding on the corpses of failed corporations that were first bled to death through over-regulation and taxation policies that drove most of their productive capabilities overseas and beyond the reach of the taxman and the regulators. Then the home offices atrophied.
The vultures had to get transfusions into the corpses first, before they could feed. That is where the low-life dung beetles come in. They have the strange power of being able to magically draw sufficient transfusion from the surrounding environment, and use it to animate the corpses into a semblence of life.
"I'm not in charge of firing Ron Gettelfinger," Rattner replied.
Rattner has faced his own scrutiny. His former investment firm, Quadrangle Group, paid more than $1 million to a New York political consultant indicted in a public corruption probe in New York.
Rattner wrote that he grappled with "the New York attorney general's investigation of my former firm, Quadrangle Group, and me about our actions in connection with an investment from the state pension fund." He did not elaborate.
‘they concluded the government needed to protect taxpayers.’
That infuriates me all over again! ‘Protect us’ by robbing us! And then file bankruptcy anyway!
Should have let it fail.....
To paraphrase a well known celebrity, it depends on what the meaning of the word "survive" is. Both GM and Chrysler are now "surviving" in "name" only.
Rattner said the task force was divided on whether to save Chrysler. The automaker was poorly run during its alignment with Daimler AG, and "larded up with debt, hollowed out by years of mismanagement, Chrysler under (private equity firm) Cerberus never had a chance," he added.
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