Information Security & US & Life & Love & Fashion & Hacking & Passion

CHICAGO (Reuters) - President Barack Obama has decided to launch a government task force for restructuring the struggling U.S. auto industry instead of naming a "car czar" with sweeping powers, a senior administration official said Sunday.

Obama is appointing Treasury Secretary Timothy Geithner as his "designee" for overseeing auto bailout loans and as co-head of the new high-level panel together with White House economic adviser Lawrence Summers, the official said.

But Obama, who took office on Jan. 20 and last week won congressional approval of a $787 billion economic stimulus program, has dropped the idea of having a single appointee empowered to handle the politically sensitive task of revamping America's once-mighty auto sector.

"There is no 'car czar,"' the official said, speaking on condition of anonymity.

There was no immediate word on when or how Obama, due to return to Washington on Monday after spending the long Presidents Day holiday weekend back home in Chicago, planned to unveil his strategy for dealing with the auto crisis.

But General Motors Corp (nyse: GM - news - people ) and Chrysler LLC, are required to submit new turnaround plans by Tuesday showing how they can be made viable after receiving $13.4 billion in emergency aid in the final weeks of the Bush administration.

According to the White House plan to aid General Motors and Chrysler with money drawn from the $700 billion fund voted by Congress, Treasury Secretary Henry Paulson will temporarily oversee loans to the two ailing auto giants.

After Jan. 20, President-elect Obama will need to choose his own more permanent overseer. This person, identified as "the president's designee" in the failed Auto Industry Financing and Restructuring Act, is now widely referred to as the "car czar."
 

The imagery and reality of a car czar is fraught with problems. First of all, under what authority will this person be able to orchestrate sacrifices required by the carmakers, United Auto Workers, bond holders, and suppliers to make the loan recipients economically viable and competitive by March 31? It is by no means clear what power, apart from personal suasion, such a person would have to resolve disputes and align interests among key stakeholders during the coming months.

Furthermore, arriving at a plan for economically viability by March 31, as stipulated by the White House, will not save loan recipients from bankruptcy unless the financial community judges the carmakers' debt to be commercially bankable. This final and most important judgment is not for the car czar, the White House or even Congress to make.

So, with little formal authority to force changes in a 50-year-old business model and an extremely limited role in certifying the economic viability of business plans submitted by loan recipients, how can the car czar truly be a czar?

What's even more problematic is that the concept of a bridge-loan program with or without a car czar has a dream-like quality in the absence of an economic stimulus program that gets fast traction and an immediate increase in the availability of consumer credit.

Unless the volume of car and truck sales recovers to the industry's current break-even point of 14.5 to 15 million units per year from its current run rate of around 11 million units, the Big Three cannot remain solvent--czar or no czar. There is no near-term financial problem facing General Motors (nyse: GM - news - people ), or any other automaker, that a surge in volume wouldn't cure.

Before he accepted Barack Obama's offer to join his presidential ticket, Joe Biden got a promise from Obama: that he would be there for "every critical decision," Biden said in an interview broadcast Sunday.

Speaking to ABC's "This Week," Biden said he believes the vice president's role is to provide "the best, sagest, most accurate, most insightful advice and recommendations he or she can make to a president to help them make some of the very, very important decisions that have to be made."

When Obama talked to him about the vice-presidential slot, Biden recalled, "I said, 'I don't want to be picked unless you're picking me for my judgment. I don't want to be the guy that goes out and has a specific assignment. ... I want a commitment from you that in every important decision you'll make, every critical decision, economic and political, as well as foreign policy, I'll get to be in the room.'"

Biden said President-elect Obama has kept the promise, having Biden in the room for all of his decisions about who will fill key posts in the administration.

Biden will have a specific assignment as the new administration gets under way, however. Come Inauguration Day, he will be the working families czar, so to speak.

On Sunday, Obama's transition team announced the new "White House Task Force on Working Families" -- a major initiative targeted at "raising the living standards of middle-class, working families in America."

The initiative will be chaired by Biden.

Other members of the task force will include the secretaries of labor, health and human services, and commerce, as well as the directors of the National Economic Council, the Office of Management and Budget, and the Domestic Policy Counsel, and the chair of the Council of Economic Advisors.

In an interview with ABC's "This Week," Biden said it's a "discrete job that's going to last only for a certain period of time."

"The one thing that we use as a yardstick of economic success of our administration: Is the middle class growing? Is the middle class getting better? Is the middle class no longer being left behind? And we'll look at everything from college affordability to after-school programs, the things that affect people's daily lives. I will be the guy honchoing that policy," he said.

Biden said he will have the authority to get a consensus among the task force -- but will use his relationship with the president if a consensus isn't reached.

"If in fact there is no consensus, [I'd] go to the president of the United States and say, 'Mr. President, I think we should be doing this, cabinet member so-and-so thinks that. You're going to have to resolve what it is we think we should do.' "

Obama has set up several key goals for the task force, including expanding education and training; improving work and family balance; a focus on labor standards, including workplace safety; and protecting working-family incomes and retirement security.

So what power will the new task force have in shaping policy?

According to the transition team, Biden and other members "will expedite administrative reforms, propose Executive orders, and develop legislative and public policy proposals that can be of special importance to working families."

"My administration will be absolutely committed to the future of America's middle-class and working families. They will be front and center every day in our work in the White House," said Obama in a statement. "And this Task Force will be one vehicle we will use to ensure that we never forget that commitment."

And in line with the Obama team's pledge of full transparency, the task force will issue annual reports, available online to the public.

Anna Burger, chairwoman of Change To Win -- a group made up of seven unions -- hailed the announcement.

"[It] shows that President-elect Obama is committed to middle class families and change truly is coming to Washington. Working people finally have an administration that is willing and eager to take action to address their needs," she said in a statement. "The White House Task Force on Working Families is a vital first step toward restoring our economy and making government work for working people again."

In what ABC billed as Biden's first interview as vice president-elect, Biden also discussed the role he played in helping Sen. Hillary Clinton decide to accept Obama's offer to serve as his secretary of state.

"She's one of my close friends. And when this came forward, I did talk to her. She sought me out. I sought her out as well, to assure her that this was real," he said, adding that "there was a lot swirling around" at the time.

Biden said he does not know whether he played a "key" role in helping Clinton make her decision. "It wasn't so much convincing, but I -- they wanted to know my perspective, and I gave my perspective."

Biden also said that the nation's economy "is in much worse shape than we thought it was in," and the immediate goal is to pass another stimulus package to prevent it from "absolutely tanking."

"There is going to be real significant investment," Biden said. "Whether it's $600 billion or more, or $700 billion, the clear notion is, it's a number no one thought about a year ago.

"... The single most important thing we have to do as a new administration -- to be able to have impact on all of the other things we want to do, from foreign policy to domestic policy -- is we've got to begin to stem this bleeding here and begin to stop the loss of jobs in the creation of jobs," said Biden, who also said he had spoken with members of Congress from both parties about a new stimulus.

Obama, meanwhile, has decided to increase his goal for creating new jobs after receiving economic forecasts that suggest the economy is in worse shape than had been predicted, two Democratic officials told CNN Saturday. Watch what Obama has to say about the economy »

The officials said Obama is increasing his goal from 2.5 million to 3 million jobs over the next two years after receiving projections early this week that suggest the recession will be deeper than expected.