The “Oceans 11” of the Auto Bailout
Steven Rattner led the Obama Administration's efforts to restructure the auto industry in 2009 as Counselor to the Secretary of the Treasury, having taken a break from his private investment firm Quadrangle Group, LLC. He has also served as Deputy Chief Executive Officer at Lazard, after having worked at Morgan Stanley and Lehman Brothers. Rattner was also employed by the New York Times for nearly nine years, principally as an economic correspondent prior to working in finance. He is author of "Overhaul: An Insider's Account of the Obama Administration's Emergency Rescue of the Auto Industry."
Question: Why were you offered the position of auto czar?
Steven Rattner: The administration thought this was a restructuring job, not a auto management job, and so they were looking for somebody who had financial skills and restructuring skills, and they also wanted somebody who had a sense of Washington even if they hadn’t worked there in the government, but could deal with the politics and the fact that it’s a public sector job. Many people from business have a hard time when they try to transition to the public sector.
Question: What was the biggest challenge?
Steven Rattner: I think I had thought about most of the challenges, but it was all pretty overwhelming. We were faced with these two companies that were running out of money, that were losing a couple billion dollars a month of cash just to stay alive with no real plan for how to restructure them or how to get them into shape. Perhaps one thing I didn’t fully think through before I got at least close to taking the job was the fact that there were no people to work with. There was no team, there was no auto office, there was no "Department of Autos," there was no nothing. I would have to come in and really build, simultaneously build a team from scratch and also come up with a plan and implement the plan.
And one of the things I probably didn’t fully anticipate was the extent to which politicians from Michigan and other places like that would question my qualifications and kind of be... I’d be getting kind of “friendly fire” if you will, from other parts of the Democratic Party.
Question: How were you vetted?
Steven Rattner: I spent a lot of time talking to my two future bosses, Tim Geithner and Larry Summers. I spent a lot of time talking to friends who had worked in Washington and friends who knew something about autos to try to get a feel for whether this job was doable. But quite frankly, I really didn’t have time to do an awful lot of that because the clock was ticking and the administration was under enormous pressure to do something about these companies. And so I couldn’t, as one might when taking a new job, I couldn’t say, "Well I’m going to go take the next six weeks and really go and think about this." This was a quick decision.
Question: What was public perception of the auto task force?
Steven Rattner: I hope, ultimately, the public perception was of a group of smart, talented professionals who came together, did this job and got out of town. One of my colleagues likened it to "Oceans 11," a group of professionals who come together, pull off a caper, as one of my colleagues like to call it, and then move on. I hope that’s how people feel about us. I think some people, probably people in Michigan, think of us a – still think of us as a bunch of Wall Street guys who came in and tore apart their iconic companies. But frankly, we felt their iconic companies needed tearing apart.
Recorded September 23, 2010
Interviewed by Victoria Brown
To save the auto industry, Washington needed a group with financial and restructuring skills–and somebody who had a sense of Washington even if they hadn’t worked in the government.
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