Former Car Czar Hates Democracy

Former car czar Steve Rattner sat down with Ezra Klein to whine about how the American people and its Congress wouldn't just turn over the whole economy to unelected experts such as himself.

Stephen Rattner Car Czar
Former car czar Steve Rattner sat down with Ezra Klein to whine about how the American people and its Congress wouldn’t just turn over the whole economy to unelected experts such as himself. For example:

When you actually deal with them to try and get something done? It’s impossible. It is so divisive, so parochial and so petty. If you look at the auto rescue, the only time Congress really got involved was over the dealers. Here we are, laying off thousands of workers and restructuring these companies, and the only thing that animated Congress was the dealers. In terms of the body as a whole, they were just obstructionists.

I think that if we didn’t have TARP, the whole economy could have imploded before Congress figured out what to do. They hated TARP because it gave the Treasury a $700 billion check, but it wouldn’t have worked any other way.

Jonathan Bernstein explains at length why checks and balances are actually not such a bad thing and pointing out that experts can be wrong from time to time.  I commend the whole piece to you but here’s a taste:

Should qualified experts make policy?  Even if they would be better at it, there’s still a case to be made for divisive, parochial, and petty voices in national policy-making.  What is bureaucracy?  It isn’t rule of the people; it’s rule of anonymous functionaries.  We are to be governed by desks — what Hannah Arendt called “the rule of nobody,” or what Max Weber called an “iron cage” from which humanity could not escape.

They feared bureaucracy not because it was inefficient, but precisely because it was so effective.  They were terrified it would leave no room for people to actively choose how to organize themselves in the world.

Quite right.  I’d call your attention to another line from the Rattner interview:

Remember, I didn’t have to be confirmed by Congress. If I’d had to be confirmed, I probably would have never gotten through.

Maybe there’s a reason for confirmation hearings, after all.

FILED UNDER: Bureaucracy, US Politics, , ,
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. steve says:

    Did you read the whole piece? My take was a bit different. He is a private equity guy. They asked him to come in and put things back together. When he wanted to do things they would in a private reorganization, Congress made it difficult (a Democratic controlled Congress). Heck, the guy worked for Morgan Stanley and Lazard before starting his own private equity firm. Can you imagine anyone with that background not being frustrated by having to deal with Congress?

    I found it more interesting that it cost him $400,000 in legal fees to get vetted. Public service is going to be limited to rich people.

    Steve

  2. PD Shaw says:

    steve, I think that comment gets to the doubts about Rattner, he’s not an auto guy, so the notion of rule by experts runs aground on a debate about whether he is the right expert.

  3. PD Shaw says:

    I found this piece the most troubling:

    “And Mr. Rattner even ladles criticism on the Obama transition team for failing to work more closely with the outgoing Bush administration on a joint program. Had they done so, Mr. Rattner writes, the government might have saved billions of dollars. ”

    http://www.nytimes.com/2010/09/20/books/20book.html?_r=1

    This is the Hoover/FDR power transfer squabble all over again. I don’t want to see this kind of crap from either side.

  4. James says:

    Rubin, Graham, Dodd, Franks, Romer, Summner, Githner….and Bush:)

    Any body notice Experts have created the current Train Wreck.:)

  5. sam says:

    Any body notice Experts have created the current Train Wreck.

    You read the beginning of the piece linked? I’ll save you the trouble of going over there:

    America’s auto industry seems healthy today. Sales are up, and so are profits. GM is readying an IPO. “An apology is due to Barack Obama,” wrote the Economist, which opposed the government’s intervention into the automobile market. “His takeover of GM could have gone horribly wrong, but it has not.”

    More train wrecks, please.

  6. steve says:

    PD- That was also a troubling part. I think this mostly reads as a guy who thinks he could have had better results w/o interference from Congress and some Obama officials. Being an investment guy, money is how he measures his success. He thinks he could have saved or made more money.

    Both Salmon and Kid Dynamite had nice pieces on this. Treasury/Fed says they could have made more money out of the deal, but they opted to get out sooner as a priority.

    Steve

  7. John Personna says:

    James seems to return to a theme: since this is a two party democracy, it is the best of all possible worlds!

    Geez, imagine passing on the latest mortgage cluster•••• to talk about how swell things are.

    For me this is not a time to be proud of our system.

  8. James Joyner says:

    Geez, imagine passing on the latest mortgage cluster•••• to talk about how swell things are.

    For me this is not a time to be proud of our system.

    I’m not writing about poorly administered mortgage systems because I don’t have anything of substance to contribute to the subject.

    And who’s saying things are swell? I’m just saying that we probably don’t want to turn our economy over to the whims of appointed experts because that’d be much worse than the consensus of the idiots in Congress, which at least have institutional checks on their power.

  9. John Personna says:

    BTW, having recently worked on this segment, I get the outsized influence of auto dealers. When he complains about that is he really complaining about democracy?

    IIRC a California desert city actually engineered a loan to some near bankrupt local dealers. That’s the kind of weight they throw.

  10. John Personna says:

    So, we should avoid experts?

    🙂

    Maybe Christine O’Donnel, she’s me!

  11. PD Shaw says:

    He is also complaining about Senator Stabenow of Michigan trying to block or slow his appointment in favor of someone with more auto experience. Now, she might have been pushing for some Michigan crony who could be expected to be more supportive of local interests, or she was completely terrified by the idea that someone without auto experience was going to have the fate of Detroit in his/her hands.

  12. steve says:

    “And who’s saying things are swell? I’m just saying that we probably don’t want to turn our economy over to the whims of appointed experts because that’d be much worse than the consensus of the idiots in Congress, which at least have institutional checks on their power.”

    I think you are just angry as you are not making sense. Are you saying Congress should have directly run the autos? That would have been much worse. I think the proper course was for Congress to find someone to manage the process and they would oversee it. What would happen if Congress directly ran everything they nominally control? Just think about the military.

    Steve

  13. PD Shaw says:

    The first thing Congress and the Presidents should have done was be up front about what they were doing. TARP was passed with one set of goals publicized and it was used for others, including the transfer of auto companies to a loyal Democratic constituency and a foreign company. The political fallout from TARP starts with the lack of political legitimacy to it’s scope and purpose at the design stage and the failure to recognize this through it’s implementation.

    I supported TARP and still defend it’s necessity, but nobody can defend the whole package or it’s implementation IMHO.

  14. Brummagem Joe says:

    PD Shaw says:
    Wednesday, October 13, 2010 at 15:47
    “steve, I think that comment gets to the doubts about Rattner, he’s not an auto guy,”

    Which just demonstrates how little you understand about this process I’m afraid . This was a restructuring involving mainly financial engineering. He had plenty of auto guys to take care of ops. Ops wasn’t the problem. And at the end of the day it’s been a huge success.

  15. Brummagem Joe says:

    John Personna says:
    Wednesday, October 13, 2010 at 16:49
    “IRC a California desert city actually engineered a loan to some near bankrupt local dealers. That’s the kind of weight they throw.”

    They are also protedted by a huge amount of state law. Both GM and Chrysler had way too many dealers. The network needed to be cut by a third and the only way you can get rid of these guys is by buying them out and of course they try to blackmail you. GM certainly and probably Chrysler have dodged a huge bullet and Rattner and his task force plus the top management of both companies (particularly GM) deserve a lot of credit. The whole spin on this by Republicans who quite prepared to see these companies destroyed is fairly typical of their whole back to front view of the world. For years they’ve been trying to spin the obvious disaster of Iraq into success and now they’re trying to spin the huge success of the auto rescue as some kind of failure.

  16. Juneau: says:

    @ Brummagen joe

    For years they’ve been trying to spin the obvious disaster of Iraq into success and now they’re trying to spin the huge success of the auto rescue as some kind of failure.

    GM, still owes $43.4 billion in bailout funds. This is a liberal’s idea of a success. That says a lot….

  17. Franklin says:

    GM, still owes $43.4 billion in bailout funds.

    It’s on track to be paid back, with interest IIRC. Not to mention the jobs saved, yada yada. If and when all that happens, yes I would definitely call it a success.

  18. Juneau: says:

    @ Franklin

    It’s on track to be paid back, with interest IIRC.

    Hardly. There is no payback to the taxpayers. Just another shell game brought to you by the good folks currently in the White House. At least according to this article in Forbes:

    http://www.forbes.com/2010/04/23/general-motors-economy-bailout-opinions-columnists-shikha-dalmia_2.html

    STILL GOVERNMENT MOTORS

    GM is using government money to pay back government money to get more government money. And at a 2% lower interest rate at that. This is a nifty scheme to refinance GM’s government debt–not pay it back!

    GM boasts that, because it is doing so well, it is paying the $6.7 billion five years ahead of schedule since it was not due until 2015. So will there be an accelerated payback of the rest of the $49.6 billion investment? No. That goal has been pushed back, as it turns out.

    In order to recover that investment, the government has to sell ITS EQUITY [ emphasis added].

    Bot “on schedule” for the payback at all… and if you want to call this a success then that’s up to you. I prefer to have my money spent on something besides supporting union pensions as far as the eye can see…

  19. Robert C. says:

    “Former Car Czar Hates Democracy”

    A little bit of hyperbole there.

    Maybe he just hates our incompetent Congress.

    I do.

    RC