Voices of Power: Gary Locke
INTERVIEW OF Gary Locke, Secretary of Commerce
Washington Post Staff Writer
Monday May 4, 2009
CHAPTER 1 - CHRYSLER
MS. ROMANOWelcome, Gary Locke, President Obama's new Commerce Secretary, former Governor of Washington State, and someone who finds himself right in the thick of all the hottest issues.
So let's start with today. You're on the President's auto team to try to save the industry, and the President today announced that Chrysler will have to go into bankruptcy. What happened?
SECRETARY LOCKE: Well, it's really a very structured, very controlled bankruptcy proceeding, which will enable them to restructure with the approval of the court and with virtually all of the major stakeholders, and the reason they had to go to bankruptcy was that there was a small number of people to whom Chrysler owes money that would not compromise.
Everyone else is making major concessions, from the auto workers to big banks and others and even some of the other holders of loans to Chrysler, but because that small group was not willing to agree to concessions, the only way to almost ignore them or to have the courts impose a settlement would be through the bankruptcy procedure.
MS. ROMANO: Now, the President seemed a little--somebody said "stern," somebody else said "angry" today at these hedge funds, and a senior White House official said that a group of the hedge funds declined to do the right thing. Is that really the crux of it?
SECRETARY LOCKE: Yes. Because you--there was not a unanimous agreement on how to restructure and--and everybody to give a little bit and not take--get repaid on all their loans or to reduce their--their equity ownership in Chrysler, it's necessary to have the courts basically impose a settlement, even on the recalcitrant parties, and so that's what the bankruptcy proceeding is all about. But, nonetheless, the vast majority of the people involved in these discussions very much support this proposal.
It's a credit to President Obama for his leadership, his strength, and his determination to save Chrysler in a way that protects the taxpayers and the people of America and saves hundreds of thousands of jobs that hang in the balance.
MS. ROMANO: Now, were you on the call when the agreement collapsed?
SECRETARY LOCKE: No, not on the call, but we were briefed along the way, and so we were aware of what was happening as late as last night and knew.
MS. ROMANO: Some of the hedge funds are saying that they thought they could do better by being a creditor. What do you think about that?
SECRETARY LOCKE: Well, again, everybody needs to sacrifice their positions and in some cases, some of these creditors are going to walk away with only 20 cents on the dollar.
The--the employees of Chrysler, the auto workers, are making major concessions cutbacks in wages and benefits, and so everybody has to share in the pain. And the President was very clear that he was not going to have Chrysler go down the tubes because of a few organizations, entities that were holding out for more.
MS. ROMANO: Do you know if the President tried to call some of these hedge funds personally?
SECRETARY LOCKE: I can't comment on that.
MS. ROMANO: What is this going to do to the rest of the industry?
SECRETARY LOCKE: Well, this is a really good sign because this is going to stabilize communities all across America.
We have so many thousands of people in hundreds of cities that make parts that go into Chrysler, the Chrysler plants, and not just the United States but also Canada, and the Canadian government is also providing some loans to Chrysler and helping protect this industry.
And eventually, under this proposal, the President's proposal, American taxpayers will be repaid. So Fiat will be the new controlling ownership of Chrysler, but they will not be the controlling entity until the loans to the American taxpayers are repaid.
So it's really a protection and win-win. But, most of all, we're saving a great American company that employs tens of thousands of people, and those tens of thousands of employees of Chrysler shop in malls, eat in restaurants, purchase other cars, remodel their homes, and support so many other businesses in their local communities. That's what this whole administration is about saving jobs.
MS. ROMANO: How are you going to protect the brand, the Chrysler brand? That's what everybody's worried about. If Joe Smith from Des Moines is going to buy a Chrysler, he's worried. You know, he's worried about whether he should go ahead and buy that Chrysler or whether the company is still going to be standing.
SECRETARY LOCKE: First of all, the warranties will be backed by the United States government, and so that's assurance to consumers, whether you own a Chrysler now or are contemplating purchasing one in the near future.
Most importantly, with this partnership with Fiat, we're going to have exciting cars, fuel-efficient cars, and Fiat has promised--and as part of this agreement will be sharing the technology with Chrysler and, in fact, building some of these engines and components here in the United States, so, again, jobs for the people of America.
MS. ROMANO: Given that the government had such a hard time negotiating this deal with Chrysler, are we looking at a similar fate for the other two companies, Ford and GM? Are we looking at bankruptcy there, too, probably?
SECRETARY LOCKE: Ford has indicated that they're not seeking any government assistance. They're much better--they're in much better financial position than Chrysler or General Motors.
General Motors actually has more time. Their deadline is down the road, but all the reports are very positive that they're making good headway, agreements with their creditors, people to whom they owe money, as well as their employees.
So I think, clearly, the President's tough stand and willingness to allow Chrysler to go into this very brief prearranged, so to speak, bankruptcy shows the determination of the President to save the automotive industry, and I think certainly that could be an incentive for the parties involving General Motors to reach their own agreement.
CHAPTER 1 CLOSE
CHAPTER 2 OPEN
MS. ROMANO: Mr. Secretary, the country and the world are careening into a panic over the swine flu. Can you bring us up to date on what the government is doing about it?
SECRETARY LOCKE: Well, this is a very important, major health issue, not just for the United States but around the world. First and foremost, the President is actively engaged and being briefed and monitoring the situation. All the Cabinet members have been called in to meetings where we are coordinating our responses and learning from each other everything that is happening.
This swine flu covers every agency, from the State Department to the Defense Department to Transportation--you name it--and obviously Agriculture and Health and Human Services and even Commerce. So the administration is focused, first of all, on getting the word out on how to prevent the spread of this flu, which means washing your hands, avoiding contact with people in spaces, making sure that if--if there are outbreaks of the flu in particular areas, in schools or what have you, that the school officials close down the schools or alert families--and keeping kids and people who might be sick at home.
That's the number-one thing. That's how we can stop the spread of this, of this flu. People who might be sick, stay at home, don't infect others.
And then the administration is focusing very intently on how to stop the flu from spreading outside of Mexico because, obviously, if the flu spreads to other countries, not the United States but other countries, Europe, Asia, those individuals will come in contact with Americans, either because they're flying into the United States on business or--or recreation or tourism or Americans might come in contact with the flu in these other countries, bring it back to the United States.
So we need to really focus on this, this flu from a worldwide perspective. Otherwise, it could really be disastrous not just for the rest of the world but also for the United States.
MS. ROMANO: Mr. Secretary, what are you doing to protect the United States' $5 billion of pork exports?
SECRETARY LOCKE: I have written a letter to the Chinese authorities indicating that their ban on U.S. pork products into China is ill-advised, not based on science. In fact, we're also sending a similar letter to the Russian authorities, and I, in fact, don't want to wait for the mail. I'll be calling the Chinese authorities personally to say our family continues to eat pork. You cannot get the flu from eating pork. It is transmitted human to human.
MS. ROMANO: Will you do any wider PR on that? Even here, domestically, people are going to start getting worried.
SECRETARY LOCKE: I think you're going to be seeing a lot of public officials, mayors and governors and members of the administration here, sending the message that the flu is contracted by human-to-human contact and that eating pork is not the problem.
MS. ROMANO: Just going back to Mexico for a second, people are very panicked. People are canceling trips, and given how much commerce we have with Mexico, tell me how closely you're monitoring this and, again, how you keep people from panicking.
SECRETARY LOCKE: Well, obviously, this is a situation that requires public officials, from the President all the way down to the Secretary of Health and Human Services, Kathleen Sebelius, to public health officials, experts from the Center(s) for Disease Control, the World Health Organization, to really speak out, to get the message out There's just too much misinformation in the media and--and word of mouth.
We've got to get the word out that the flu is not contracted by eating pork. It is not contracted just by travel. You have to come in contact with people who are infected, and the best way to avoid it is if you are sick or ill, stay at home. Be sure you're constantly washing your hands, so that you're not spreading it to other people.
But we're concerned about the impact because Mexico's economy--an economy of so many of the Americas are very fragile, and if trade stops with Mexico, if tourism stops with Mexico, that could exacerbate their economic problems, as well as exacerbate the economic problems of the United States.
MS. ROMANO: Do you feel like Mexico is doing enough on the problem, themselves?
SECRETARY LOCKE: They are. I'm sure everybody wants to do more, not just in Mexico but the United States, and we also have several--several dozens of people from the Center(s) for Disease Control in Mexico helping out, trying to get samples and analyze the flu strain there. It's--it's interesting to note that the severity of the flu in Mexico is much more severe, is stronger--is higher than it is in the United States, and those who have contracted the flu in the United States seem to have a milder form of it. So we're really trying to understand why that is the case.
MS. ROMANO: Is there a larger administration concern that, you know, the fear and the panic about the flu could--could trigger a worse recession than we're in now and even lead to a depression?
SECRETARY LOCKE: I don't think there's any fear or concern that it would lead to a depression. We just want to minimize the impact.
It's important on all public officials to make sure that the word is out, that people take the proper precautions, that nobody overreacts, and that's why, of course, we've had Secretary of Agriculture Vilsack indicate strongly that people should not stop eating pork.
I'm communicating with my counterparts in Russia and in China saying our family is eating pork and there's no need for alarm. This is a very serious outbreak. We don't want it to spread across the world. At the same time, we need to take precautions. They must be prudent, but we should not overreact.
SECRETARY LOCKE: It is a flu. You know, it simply is a flu, and, you know, every year, we have flu.
CHAPTER 2 CLOSE
CHAPTER 3 OPEN - CENSUS
MS. ROMANO: Let's move on to your third hot issue, the Census. The 2010 Census is coming up. The stakes are very high this year. It's the first time a Democrat is President in 30 years overseeing a Census.
We have realignment. We have some concerns that in a post-9/11 world, some people would be hesitant to give up information about themselves. Tell us what models you're developing to ensure that all ethnic groups and minorities are accurately counted.
SECRETARY LOCKE: Well, for the first time, we will be sending our forms in different languages and specifically in Spanish. So populations, communities with a large Hispanic population will actually receive a Census questionnaire, Census form in that Spanish, as well as English.
We're also looking at sending out additional languages, different languages to other populations, whether Chinese or Vietnamese, in those populations, those communities that have a large percentage of Asian families, whether Houston or New York or San Francisco.
It's very important that we have an accurate count. This actually dates back to the beginning of America. George Washington, when he was first President, conducted a Census, and there was a big debate between Jefferson and Hamilton on--on how to count people, and even George Washington, his very first veto, the very first veto in Presidential history was--was by President George Washington over the Census.
MS. ROMANO: Is that right?
SECRETARY LOCKE: So, you know, these--these issues are very contentious --and go back to the very beginning of America.
But we're going to do everything we can to get the word out that it's important that people participate in the Census because some $300 billion a year in Federal funds will flow based on where people live, and if we don't have an accurate count, some communities might not be getting their fair share of Federal dollars for education and transportation and human services, especially in these tough economic times when states and cities are cutting back on funds for community projects in education and human services.
So the Federal dollars could really make a big difference.
MS. ROMANO: So, just to confirm, this is the very first time that the Department, the U.S. Bureau of Census, is going to send out forms in different languages.
SECRETARY LOCKE: In different languages, without people having to ask for it.
And we're going to try and--we're going to be working with the news media, newspapers.
MS. ROMANO: So you're going to be targeting households that you believe are Hispanic households, or it's just going to go out in multi languages?
SECRETARY LOCKE: No. We're going to be very specific. From--from past information, we know, for instance, in which parts of Houston, there's a large Vietnamese population. We know where in Los Angeles. In the Southwest, we have large populations, blocks of Hispanic families, and so we're going to be very strategic and very targeted.
Obviously, we don't want to send a Hispanic--or a Spanish questionnaire to a part of the United States where we know it's virtually 99.9 percent non-Spanish.
MS. ROMANO: Will you, in part, rely on sampling, even though the Republicans are like dead set against it?
SECRETARY LOCKE: The United States Supreme Court has actually ruled that we are not allowed to use sampling.
MS. ROMANO: For apportionment.
SECRETARY LOCKE: For apportionment. Nor do we have any plans to use sampling for any other purpose connected with the 2010 Census.
MS. ROMANO: Every White House has tried to play a role in the Census. What will be this White House's role in the U.S. Census?
SECRETARY LOCKE: The Census director reports to me, and, of course, I serve at the pleasure of the President, but every administration wants to know what's happening, are we--are we getting the right counts, are people participating, and, in fact, we have perhaps more inquiries from the United States Congress.
So every Census has uniformly and periodically informed the President, whether Democratic President or Republican President, and the Congress of our progress during the 2010 Census, but nobody will be allowed, whether a congressman, a Democrat, Republican, or anyone, to interfere with the actual count of the Census.
We will supply the figures. The figures will be what they are. It's up to, then, the politicians to decide what they're going to do with those figures.
You know, each State decides their allocation and--and drawing of the boundaries for state legislature, for Congress, in different ways. Some states have it done by the courts. Some states do it with their state legislatures. Some states use citizen commissions.
We're not involved in that. We just give them the numbers.
MS. ROMANO: Well, just to follow up on that, Senator Judd Gregg, who was tapped initially to take this job, pulled out, in part, because they were trying to move the Census to the White House. Are you going to take some particular precautions to make sure that the Census is not politicized?
SECRETARY LOCKE: It will not be politicized, and the White House assured me that it has no interest in politicizing it. There may have been some misunderstanding when Senator Gregg was first announced, and--but the White House has said that they had never issued such a statement, and how that perception arose, no one's really sure.
But we will inform the White House, along with the Members of Congress, on the progress of the Census.
In fact, the Congress has been holding numerous hearings on the Census, wanting to know if it's on time, within budget, do we have the technology with respect to conduct the Census. We will be relying extensively on outreach. We will have to hire over a million people to knock on doors to go after the families who did not send in the Census forms.
And so we're going to be recruiting people of color from every part of the country, relying on churches, relying on non-profit organizations, newspapers, TV, radio, mayors, and others to say get the word out, we need everyone to count, to be counted.
MS. ROMANO: One final question, you were a little late coming to the dance, after two other potential nominees tanked. When you met with the President, what did he tell you he wanted you to do in this job, and how did he advise you to get up and going quickly?
SECRETARY LOCKE: He indicated that he needed my management skills. He needed me to be part of the economic team, and that the country is in serious trouble, and that we need to get moving as quickly as possible.
And America is facing a lot of challenges, and when the President calls, I think it's incumbent upon all of us to help the President.
MS. ROMANO: Okay. Well, thank you very much for joining us today.
SECRETARY LOCKE: My pleasure.