February 17, 2009 at 2:12 pm

Auto panel to exert broad clout

Obama opts to centralize authority by choosing task force that can cover many aspects of struggling industry.

Geithner )

WASHINGTON -- President Barack Obama's decision to create a task force on autos, rather than appoint a car czar, centralizes authority within an administration that realizes the struggling automakers are facing an increasingly uncertain future.

While presidential task forces are not new, industry and political experts say the panel announced Monday by the White House will exert an unusual amount of power. The Obama administration's point person -- the person with the legal authority to require auto restructuring -- is Treasury Secretary Timothy F. Geithner.

"It sounds like Obama's trying to centralize supervision and decision-making, and is skittish about delegating what is a very important part of the economic recovery to someone who is not totally integrated into the White House," said Julian Zelizer, professor of history and public affairs at Princeton University. "Geithner is someone the president is very close to. Even through the whole tax thing, he remained very loyal (to him)."

The Presidential Task Force on Autos, which is co-chaired by National Economic Council Director Lawrence Summers, will include representatives from 10 Cabinet agencies and White House offices, including the Environmental Protection Agency.

Another key member named by the White House is Ron Bloom, a former consultant to the United Steelworkers president and a former investment banker, to be a special adviser to the Treasury Department. Diana Farrell, deputy National Economic Council director, is also expected to take a key role on the task force. She's a former McKinsey & Co. director

The panel is expected to meet for the first time later this week; the White House has not released the names of other members.

"The announcement shows how serious the administration takes the issues facing our auto manufacturers and suppliers, and the need for a team illustrates the complexity of the challenges the industry faces," said Sen. Debbie Stabenow, D-Lansing.

Some political and industry experts question whether the breadth of the panel might create an unmanageable task force.

"It doesn't seem to me that we need a panel of many," said longtime auto analyst Maryann Keller of Maryann Keller & Associates of Stamford, Conn. "They don't have time for input from all of the interested parties, including the EPA. Somebody's going to have to say yes or no in a few weeks."

But Jim Hall, principal at 2953 Analytics, a Birmingham consulting firm, said the breadth of the task force acknowledges that it would be almost impossible to find one person who understands all aspects. The group risks being unwieldy, but "this is the better way to do it. It reflects the reality that there isn't one person who can do the job," he said.

He said the administration seems intent on achieving a short term fix. "The whole idea is to make a viable manufacturing sector for the United States. That's always been the intention," he said.

Larry Sabato, director for the Center for Politics at the University of Virginia, said it's arguable that a large and diverse task force is ultimately more effective. But a large task force may need a longer time table to arrive at decisions. Ultimately, how quickly things are done will depend on the president, he said.

"If President Obama wants them to move quickly, they will -- whether it's a big or small task force," he said.

White House press secretary Robert Gibbs said the inter-agency task force members bring "their expertise and understanding of a lot of complex issues."

Geithner has been charged with approving all proposed auto transactions of $100 million or more and ultimately deciding whether to call back the $17.4 billion in government loans made to General Motors Corp. and Chrysler LLC. The automakers will submit restructuring plans today.

Bloom, of the United Steelworkers, will be working with the automakers, bondholders and the United Auto Workers.

He has been involved in many complex union negotiations, especially over the formation of union-run trust funds to oversee retiree health care, a key issue for Detroit's automakers and the UAW. Gibbs called him "somebody who has vast credibility on a lot of these issues and will be a big boost for this task force."

In 2005, Bloom's former investment banking firm, Lazard Ltd., was retained by the UAW to review GM's finances when the automaker was seeking concessions on health care costs. Paul Krell, a UAW spokesman at the time, told Reuters that Bloom took part on an informal basis. "He's an old friend of the UAW," Krell said.

GM and Chrysler were ready to work with the task force.

"Chrysler looks forward to working with the auto team as the company continues and completes its restructuring plan," said spokeswoman Shawn Morgan.

David Cole, chairman of the Center for Automotive Research in Ann Arbor, praised the choice of Geithner as the designee.

"I feel better that it's someone from the financial side because they tend to be driven by economics," he said, whereas there's a risk that an appointee from the Energy Department or EPA "could be tainted by ideology."

Geithner has an interesting connection to the auto industry. His maternal grandfather, Charles Moore, was a vice president at Ford Motor Co. overseeing communications and advertising, said Peter Geithner, who is the Treasury secretary's father. Moore worked at Ford from 1952 through 1963 -- though he took a leave of absence to work for President Dwight Eisenhower.

Detroit News Staff Writer Alisa Priddle contributed to this report. You can reach David Shepardson at (202) 662-8735 or dshepardson@detnews.com">dshepardson@detnews.com.

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