Thread: Obama suggests some auto execs should lose jobs

Obama suggests some auto execs should lose jobs
By PHILIP ELLIOTT Philip Elliott 1 hr 14 mins ago
CHICAGO – President-elect Barack Obama announced support Sunday for a short-term government bailout of the nation's carmakers that is tied to industry restructuring. He also accused auto executives of a persistent "head-in-the sand approach" to long-festering problems.

Obama said Congress was doing "the exact right thing" in drafting legislation that "holds the auto industry's feet to the fire" at the same time it tries to prevent its demise.

In an appearance on NBC's "Meet the Press" and later at a news conference, Obama suggested some executives should lose their jobs.

One leading Democrat in Congress, Sen. Christopher Dodd of Connecticut, was far blunter. Rick Wagoner, the chief executive of General Motors Corp., "has to move on," said Dodd, chairman of the Senate Banking, Housing and Urban Affairs Committee.

In response, GM spokesman Steve Harris said the company appreciates Dodd's support for the loans, but added, "GM employees, dealers, suppliers and the GM board of directors feel strongly that Rick is the right guy to lead GM through this incredibly difficult and challenging time."

Last week, The Associated Press asked Wagoner if he would resign at the request of Congress, to which he replied, "It's not clear to me that experience in this industry should be viewed as a negative, but I'm going to do what's right for the company and I'm going to do it in consultation with the board."

GM's board recently has been meeting three times a week by telephone.

The criticism of industry leaders deepened as negotiators for the White House and Congress narrowed their differences over a plan to extend roughly $15 billion in short-term loans to any Detroit automaker that needs it. Analysts say General Motors Corp. and Chrysler LLC, in particular, are at risk for running out of money in the next few weeks, and that Ford Motor Co. may need help if the economy deteriorates further.

Democratic Sen. Carl Levin of Michigan, whose state is ground zero for the battered industry, said he was confident an agreement would emerge within the next day.

Democratic leaders have said they hope to pass the measure this week. While Levin declined to predict its approval, support among rank-and-file lawmakers presumably would improve dramatically if both White House and Obama were to signal their backing once the legislation is complete.

"The last thing I want to see happen is for the auto industry to disappear, but I'm also concerned that we don't put $10 billion or $20 billion or $30 billion or whatever billion dollars into an industry, and then, six months to a year later, they come back hat in hand and say, `Give me more,'" Obama said.

Obama, who takes office Jan. 20, has drawn some criticism from Democrats who want him to become more involved in efforts to save the industry. The president-elect said his aides are monitoring developments and considering longer-term plans.

He expressed no support for calls to allow the big carmakers to enter bankruptcy and said, "We don't want government to run companies." Instead, he said, "if taxpayer money is at stake — which it appears may be the case — we want to make sure that it is conditioned on an auto industry emerging at the end of the process that actually works, that actually functions.

"Taxpayers, I think are fed up. They're going through extraordinarily difficult times right now."

Obama did not single out any individual executive by name for criticism, and said there had been incremental progress in the past 15 years toward a more competitive line of products.

"What we haven't seen is a sense of urgency and the willingness to make tough decisions. And what we still see are executive compensation packages for the auto industry that are out of line compared to their competitors, their Japanese competitors, who are doing a lot better," he said.

Asked whether the top executives should remain in the jobs, he said: "Here's what I'll say, that it may not be the same for all the companies. But what I think we have to put an end to is the head-in-the-sand approach to the auto industry that has been prevalent for decades now."

Later, at the news conference, he appeared to temper his comments, saying that current management should be ousted if it doesn't understand the urgent need to make changes in the industry.

A breakthrough on the long-stalled rescue came Friday when House Speaker Nancy Pelosi, D-Calif., yielded to President George W. Bush on a key point: allowing the aid to come from an existing fund set aside for the production of environmentally friendlier cars.

The Big Three executives spent two consecutive days on Capitol Hill this past week pleading for as much as $34 billion in loans to help their industry survive. But they made clear that $15 billion would be enough to keep them running until the end of March 2009.

Dodd appeared on CBS' "Face the Nation" and Levin was on "Fox News Sunday."

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AP Auto Writer Tom Krisher in Detroit contributed to this story.

Copyright © 2008 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.
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Seems to me like obama is the last person on this planet right now to be talking about ANYONE taking a head-in-the-sand approach to difficult issues or calling for others to have their feet held to the fire.

He should try practicing what he preaches.

WOW...this is a first....I actually agree with him about the executives and their 22 Million dollar salaries.....I don't even make 30 thousand and why should I HAVE to help someone who makes 22 MILLION

Dodd Calls for Firing GM’s Wagoner, Chrysler Merger (Update4)

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By Lorraine Woellert and Nadine Elsibai

Dec. 7 (Bloomberg) -- Senate Banking Committee Chairman Chris Dodd said General Motors Corp. Chief Executive Richard Wagoner should be replaced as a condition for federal aid and Chrysler LLC may have to merge to survive.

“You’ve got to consider new leadership,â€

I have a better suggestion of massive paycuts for the executives as well. After all they are the ones who okayed those decisions that put the companies in this mess. If they had any other job they could very well have been fired.

This is an absolute quagmire. The companies go under and millions of Americans will lose income, not only suppliers and dealers but even Joe the hot dog seller who makes money from workers during lunch. The mortgage meltdown will worsen with more families living in their cars, unless those have been repossessed.
Ford is the only one that has asked for $9B line of credit to be available, in case they need it one day if the economic mess gets worse. GM is bleeding billions every month, and Chrysler, in my estimation has the least standing asking for money since they are owned by a private investment group (not putting any more money in the company) which is not required to give any transparency to the new investors, i.e. the American taxpayers.

Just give Real American taxpayers a bailout voucher $15,000 each family
only good toward a car from the Big three. That way they work for the money and we get something.