Blue Collar Manufacturers Get Their Hands Held, White Collar Financials Get Their Wrists Slapped

So the White House and Congress are collaborating on a draft bill to bail out the auto industry in the short term. We'll have another czar, apparently:

According to draft language being circulated on Capitol Hill, the Democrats would call for an overseer, also known as a “car czar,” with expertise in such areas as “economic stabilization, financial aid to commerce and industry, financial restructuring, energy efficiency and environmental protection." [...]

The draft bill, which is still being negotiated by Congressional leaders and the Bush administration, would provide emergency bridge loans totaling about $15 billion to the foundering automakers, particularly General Motors and Chrysler, which are in the greatest danger of financial collapse.

The president’s appointee would be responsible for disbursing the emergency money and would be responsible for supervising the implementation of the drastic reorganization plans that the auto manufacturers agreed to carry out in exchange for government aid. The president would also be able to designate other officers from within the executive branch to assist in the auto industry rescue.

By Jan. 1, according to the Democrats’ draft, the car czar would be required to develop benchmarks for assessing the automakers’ progress in carrying out those plans. The car czar would also have the powers to convene meetings of stakeholders in the auto companies including labor unions, creditors, suppliers, automobile dealers and shareholders.

Why you would let George Bush, in the final month of his Presidency, pick the overseer of the entire domestic auto industry, who will have a major say in what they can produce, what kind of recovery money they will receive and what kind of organization the companies would undertake is completely beyond me. I assume that's the price for White House support; but I don't know, giving a Bush appointee, given what we know about Bush appointees, that kind of power would seem to me to be disastrous.

Marcy Wheeler has more, including some details inside the draft agreement:

There's one clause which I've dubbed the "Nancy Pelosi clause" requiring the car companies to drop their suits against increased emissions standards in CA and other states:

(g) WITHDRAWAL FROM CERTAIN ACTIONS.—The terms of any financial assistance under this Act shall prohibit the eligible automobile manufacturer from participating in, pursuing, funding, or supporting in any way, any legal challenge (existing or contemplated) to State laws concerning greenhouse gas emission standards.

And there's a clause which I've dubbed the "Atrios clause" requiring car companies to consider moving some of their SUV capacity into producing transit vehicles:

(a) IN GENERAL.—Each eligible automobile manufacturer which receives financial assistance under this Act shall conduct an analysis of potential uses of any excess production capacity (especially those of former sport utility vehicle producers) to make vehicles for sale to public transit agencies, including—

(1) the current and projected demand for bus and rail cars by American public transit agencies;

(2) the potential growth for both sales and supplies to such agencies in the short, medium, and long term;

(3) a description of existing ''Buy America'' provisions, and data provided by the Federal Transit Administration regarding the use or request of waivers from such provisions

There are, in short, a lot of restrictions on the carmakers, some of them very salutary. But as I've said before, the CEO of Citi didn't have to give up his private plane, didn't have to necessarily restructure executive salaries, didn't have to deny business to anyone, etc. And the large influence of the Bush-selected "auto czar" means that some very not-so-salutary restrictions, like breaking unions and closing pensions, could become the end result.