Wanted: Crisis Manager in Chief

Wright added that while the Chrysler bailout "worked in the sense that it didn't cost the American taxpayer anything," he noted that "it failed in the sense that Chrysler got into trouble again."

Joseph Pratt, professor of history and business at the University of Houston, said other lessons can be learned from the efforts of Jesse Jones, who headed the Reconstruction Finance Corp. during the 1930s and was essentially a czar for several industries.

"What the RFC did was . . . support companies that were temporarily in danger of going belly-up but had long-term value, like the railroads and auto companies," Pratt said. "It stopped the bleeding."

Yet that experience could also serve as a warning.

"Probably the less this person does, the better," said George Daly, economics professor and dean of the Georgetown University School of Business. He said that lawmakers' priorities about "overseeing everything from mileage standards to emission caps" worried him. "That would be most economists' worst fear," he said, "that it's going in the direction of mixing a whole number of agendas other than the need for the industry to become more efficient."

That, he added, would result in a corporate model more consistent with Britain before Prime Minister Margaret Thatcher. "Remember the British coal board?" he said. "They had a bunch of coal mines that were producing at a loss."

Wright also pointed to the U.S. nationalization of railroads as an example of unsuccessful government meddling.

The federal government nationalized and created Conrail in the mid-1970s and ran it for a decade before selling it for a profit, he said. But, he added, the government also took over passenger railroads, which it subsidizes to this day.

"Amtrak is a disaster," Wright said. "It's too expensive and too slow."

One thing a federal czar can prevent is excessive executive compensation, a priority for Congress.

Though he wasn't appointed by the government, court-appointed mediator Breeden took charge of WorldCom to stop what the judge in the case called "corporate looting." He eventually guided the company through bankruptcy while keeping 60,000 of its 75,000 employees, delivering $12 billion to the company's creditors.

"There you didn't have a public injection of funds, but the largest customer was the federal government. And by not pulling its business, the federal government gave them the time to reorganize."

Breeden changed the entire board of directors and contained executive compensation. On Breeden's first day on the job, the chief executive said his $1 million a year salary urgently needed to be raised, pointing to a consultant's report that suggested executive pay in the industry averaged $174 million. The chairman, meanwhile, wanted Breeden to approve reimbursements for use of his personal plane. Breeden rejected both requests.

"I said 'Look, let's keep this clear: The court didn't send me here to approve this garbage,' " recalled Breeden, who later hired a new chief executive.

Breeden said the government should have installed overseers and ousted boards of directors at Citigroup, AIG and other firms that have turned to the government for rescue funds.

"You can't price what Citigroup is absorbing [in taxpayer money], but it will certainly be way above the car companies," he said.