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Page last updated at 19:24 GMT, Monday, 30 March 2009 20:24 UK

US media on Obama's car firm plan

Reaction in the US media to President Barack Obama's plans for the US car industry has been mixed.

GM headquarters, Detroit, Michigan
Should the US government get involved in GM's affairs?

Right-wing commentators have made it clear that they are unhappy with the extent to which the government is involving itself in private enterprises.

"I get the heebie-jeebies any time a politician makes a business decision," writes Atlantic Monthly blogger Andrew Sullivan , a conservative who has been very supportive of the Obama administration.

John Cole, of BalloonJuice.com , dismisses the objection.

"This isn't the government going to Microsoft and telling Bill Gates what to do... These are companies who have made decades of bad decisions coming to the government for yet another bailout, and as a requirement, the Obama team is demanding some leadership shake-up."

Obama's problem

At the National Review, Jonah Goldberg warns that President Obama's "first concern is to avoid bad political fallout, which means he will prop up the company for as long as it takes, regardless of what makes economic sense."

"This, in turn, will likely make the company either less economically sound or, it will rebound - but only by getting special breaks other companies won't get. Either way, bad practices will be rewarded and/or good practices will be punished."

What if the industry's infection is just too widespread?
Marc Ambinder, Arlantic Monthly

In this, Mr Goldberg echoes Slate.com's Mickey Kaus , who notes that the government's decision means that GM's future performance will be the president's responsibility.

"Won't Obama now 'own' the GM problem?" he writes. "If the company shuts down in the near future, costing tens of thousands of blue collar jobs, it will be under executives implicitly or explicitly chosen by Obama. It will be Obama's failure, not simply GM's failure, no?"

On the left-wing of the blogosphere, the discussion has focused on the seemingly different approach the administration has adopted towards the car industry and the banking system.

Liberal blogger David Sirota, writing at Openleft.com , says he is "not sure" whether the decision to fire GM CEO Rick Wagoner is "a good or bad thing".

"But I am curious about why the White House would make such a bold demand of a car company the federal government is lending to, but not a similar demand of the banks the federal government partially owns."

Death spiral?

A fellow liberal, Josh Marshall from Talking Points Memo, offers up an answer .

"It gets more complicated on further inspection. Citi[bank] does not have the same CEO it did at the start of the crisis. And the government installed a new CEO at AIG after the initial bailout... even after getting substantial government aid, I think Wagoner's the first auto industry CEO to get the boot. So perhaps we should be asking why it is that something like this hasn't happened sooner."

The Atlantic Monthly's political insider, Marc Ambinder wonders what will happen if the government's solutions fail to bring the car manufacturers back from the brink.

"The government is telling GM to be like Toyota. But what if the industry's infection is just too widespread? No amount of patient self-care - 'clean those wounds better! Eat your vitamins! Get exercise!' and no amount of antibiotics (the billions government's pouring in) can arrest the death spiral?"

The Washington Post's Chris Cillizza suggests that the administration could be acting tough with the car industry in order to show Congress it can be fiscally responsible ahead of crucial forthcoming budget battles.

"[The car plan] comes as the House and Senate take up Obama's budget proposal in earnest this week with many conservative Democrats expressing concern about the level of spending outlined in the bill," he notes.

"Context matters in politics and policy. And the message the Obama administration is sending with their hardball approach on the auto industry is clear: spending for spending's sake - without significant accountability attached - will not be accepted."



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