Car Czar Rattner's Book Gives Behind the Scenes Look at Auto Bailouts
By Doron Levin September 3, 2010
Steve Rattner, President Obama's car czar, has released galley proofs of ``Overhaul,'' a book that gives an insider's peek at the government's restructuring of the U.S. auto industry, most notably the two automakers that filed for bankruptcy, General Motors and Chrysler. The 320-page memoir, to be published October 14 by Houghton Mifflin, lauds the government's efforts, spicing the tale with tittle-tattle such as the four-letter expletive aimed at the UAW by President Barack Obama's chief of staff Rahm Emanuel. A White House source, speaking without attribution, told the Washington Post that Emanuel defended and advocated for the autoworkers.
Rattner, a former New York Times reporter and investment banker, writes that after he fired Rick Wagoner as GM's chief executive officer, he asked Carlos Ghosn, the chief executive of Renault SA, if he was interested in the job. Ghosn declined but said he remained interested in an alliance with GM. Rattner also disclosed that the task force asked Kent Kresa to resign as GM's chairman. Half of GM's board was booted; Ed Whitacre Jr. became chairman and later took over as CEO.
Simon Sproule, a Renault spokesman, acknowledged Rattner's version of events. He said Ghosn felt he still had work to do after ten years on the job leading the alliance of Renault and Nissan Motor Corp.
The book's most glaring omission, in the opinion of several who have looked at the manuscript, is an in-depth account of the Quadrangle affair, named for the private-equity firm that Rattner founded, which was swept up in an ethics scandal in New York. Quadrangle paid a fine after it was accused of improperly soliciting business from state pension funds. The scandal most likely contributed to Rattner's early exit from the task force. He resigned from Quadrangle.
Rattner wrote that he was disappointed that Whitacre didn't stick around GM to finish the job of restructuring the automaker, stepping aside only a few weeks ago for Dan Akerson, a private equity specialist who has taken over as chairman and chief executive. Detroiters and the auto industry will find many of the nuggets in the books delectable, such as the assertion that Fritz Henderson, who briefly ran GM as CEO before Whitacre fired him, wanted to move the company's headquarters to the Tech Center in Warren, Michigan from the Renaissance Center in Detroit. Rattner liked the idea; it was vetoed by the White House, which wanted to avoid further damage to Detroit's battered economy.
Fiat Auto CEO Sergio Marchionne, whose company would take over 20 percent of Chrysler, crossed swords with Ron Gettelfinger, president of the UAW, telling the union chief that autoworkers had to accept a ``culture of poverty'' instead of a ``culture of entitlement'' as part of the restructuring. Gettelfinger, in Rattner's account, rebuffed Marchionne, telling him he ought to come with him and tell a ``75-year-old'' widow that she can't have surgery and that ``you killed her husband.''
According to the book, the government pushed Fiat to put up cash as part of its agreement to run Chrysler, which the Italian company refused.
Rattner concludes that the ills of the Detroit auto industry were partly to blame on globalization, partly on poor management: ``I would discover the struggles of GM and Chrysler were as much a failure of management as a consequence of globalization, oil prices and organized labor,'' according to an excerpt quoted in the Detroit News.
"Detroit should count itself lucky,'' Rattner writes, calling the bailout of the auto industry one of the administration's greatest achievements.
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Greatest achievement, my a**. Where is it written in the Constitution that they have the authority to do any of the things such as this that they've done?
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