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Desperation Behind the Wheel

By Jim Hoagland
Sunday, June 7, 2009

Foreign lands define themselves to us through national symbols long before we learn their languages or customs. The bear reminds us to be careful of Russia and Germany, the rooster crows for France, Britain fronts the haughty lion while we Americans identify with highflying, lonely eagles.

But for much of the 20th century, the car -- the more powerful and flashier the better -- represented the modern American way of life to the world. The restless ambition to move up and on, diversity of choice and the embrace of excess that are hallmarks of American society run through the country's love affair with automobiles and highways. The car defines for many Americans who they are and what they want, at least while they are behind the wheel.

So President Obama and his aides have set themselves an enormous and politically dangerous task in trying to rescue the American car. That they are providing massive government funding to General Motors and Chrysler without a clear vision or guiding philosophy about the effects their decisions will visit on the industry -- and ultimately on the American dream as shaped or misshaped by Detroit -- compounds the risks they take.

This is a president who knows how to put on a brave face in public. He and his aides labor to reassure us that the banks are sound, that GM will stop digging its own grave any day now and the Iranians may yet be talked out of building nuclear weapons. One out of three may turn out not to be so bad. (I'll bet on the banks.)

This visible courage comes in handy. Obama demonstrated how on his hopscotch across the Middle East and Europe. Standing in Cairo to tell the Muslim world to stop denying the Holocaust and to stop applauding the murderers of Sept. 11, 2001 -- just before he called on Israel to halt settlements in Palestine -- required moral toughness and clarity. He deftly anticipated the risks of following this middle course.

But relying on steady composure to buy time carries its own risks. This could be the case as it becomes clearer to Americans that the $50 billion U.S. bailout of GM is being driven entirely by fear and the lack of any strategy other than warding off immediate disaster.

"We are a reluctant draftee, not a volunteer" in taking ownership stakes in GM and Chrysler, says Steven Rattner, a leader of the White House auto task force overseeing those bailouts. "We backed into it out of necessity, not choice" to avoid company crashes that would have threatened the national economy, Rattner continues.

Brian Deese, another task force member, adds that the president's advisers thought about an abrupt liquidation of GM "as a Lehman-type risk, an event that would bring on things you can't predict. . . . We were looking at a uniquely fragile moment" when GM came asking for and got emergency federal funding.

But should we be reassured when the president and his advisers vow so strenuously that they are not surreptitiously nationalizing the banks and the automobile industry? "Fixing car companies is not part of a broader agenda," Rattner told Post opinion writers last week. "Our goal is to get out as soon as possible."

But Rattner may protest a little too much. This administration is recasting the government's role in the economy and its relationship to private enterprise on a massive scale that needs to be thought about, acknowledged and subjected to an honest national debate.

By design or "necessity," Obama will fashion something resembling an American social democracy by the time he leaves office, having lifted the national debt to previously unimaginable levels and rejiggered corporate-labor relations through a government-supervised auto industry. Better a master plan, openly arrived at and spelling out a governing philosophy, than a camouflage of calm to avoid GOP accusations of nationalization.

I find striking and a little alarming Deese's reference to the fear of a repeat of the sudden failure of Lehman Brothers last September and the subsequent freezing up of credit markets as being a driving force in the GM bailout. It points toward a current of desperation that runs just beneath Obama's outward sang-froid but does not get acknowledged until after the fact.

The American car industry has earned opprobrium for turning a once-proud national symbol into a global insignia of corporate failure. In other spheres, Obama has promised to correct American mistakes. That should go for cars, too.

jimhoagland@washpost.com

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