In his tell-all book due out this fall, former Car Czar Steven Rattner reveals how Chrysler came within a hair of going the way of Lehman Brothers, and being allowed to fail. A majority if the auto task force actually voted against offering aid to Chrysler, and it was only after a tense meeting with the president that Chrysler was offered federal aid.
The story goes back to October of 2008, when after the Senate refused to help Chrysler, then CEO Bob Nardelli tried to urge the Treasury to force GM to acquire Chrysler, but GM hadn”t wanted to get involved in such a deal as they saw the overlap in business of the two companies to be too cumbersome and inefficient. When the merger made no progress, Rattner reports that Steve Feinberg of Cerberus Capital, Chrysler’s owner, called Treasury Secretary Henry Paulson at 2 a.m. on December 19th with an offer to turn Chrysler over to the U.S. government for $1.
It was finally determined that Chrysler was worth much more as an entity alive than it was dead, despite the reluctance of Rahm Emanual and other White House staff to aid the company.
Regardless the case, the book offers tremendous insight into the opinions of high level officials with regard to the bailouts and the unions, and promises to reveal some interesting facts.
– By: Stephen Calogera