Drift and Oblivion

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November 14, 2008 10:42 a.m.

Presidential transitions are notoriously perilous interludes. The normal calculus of power and responsibility is upended. In recent decades there was seldom enough occurring for it to matter all that much. But that’s not the case now. And just in the last day or so it’s crystallized in my mind that we may be on track for some serious problems.

First, the management of the almost trillion dollars of bailout money. It’s good news that Paulson has dropped the entire toxic debt reverse auction idea in favor of direct infusions of capital into the financial services companies. But there’s an unmistakable make-it-up-as-you go-along
quality to it. And while that’s probably inevitable and even benign to some degree, there’s a lot of hundreds of billions of dollars being assigned by people who will be able to wash their hands of the whole matter in about two months. And that’s a problem.

Next, the auto industry. Could GM really go under in the next couple months because the Democrats who’d bail the company out are currently at the mercy of the electorally discredited Republicans who want to use the crisis to crush one of the last major manufacturing unions? The continued existence of a domestic auto industry is more than a strictly economic issue. Henry Blodget says we should use the money for “on retraining and job placement than on propping up perpetually weak companies that can’t fix themselves.” I assume he’s making a move into comedy. Because job training and placement into what exactly? Maybe he’s become another Bob Reich on worker retraining. But what jobs does he imagine we’re going to feed these often older workers into in anything like the short or near term in the middle of a massive recession? Whatever you think should happen it should happen as a matter of considered national policy, not because the Democrats won’t be able to break a filibuster or overcome a veto until late January.

I’m inclined to think that at least in the short-term GM may be bluffing, that if relief is in the offing in 60 days that they can find some way to hold on until then. At least I hope so.

Moments of national crisis require experimentation and open minds. But more than anything they demand energy and direction, a plan — one where the different moving parts interlock together in some rational way. But this feels like drift.

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