Event Summary
The economic crisis that started in the U.S. housing markets and spread to worldwide financial markets eventually boomeranged back to the American retail and manufacturing sector, hitting the U.S. auto industry particularly hard. High oil prices, gas-guzzling models and mismanagement also contributed to the industry’s downturn. As a result, once-iconic American brands struggled to survive, with both GM and Chrysler needing taxpayer infusions to continue to operate. Controversies arose over whether the car companies, like the banks, deserved to be bailed out, what the government’s role should be in their operations and whether bondholders got a fair deal compared to union workers.
On October 21, the Initiative on Business and Public Policy explored the government’s role in the auto industry and their future relationship. Steven Rattner, former head of the Obama administration’s Task Force on the Auto Industry, delivered the keynote address. He then joined in a panel discussion that included Brookings Senior Fellow Clifford Winston; Communications Workers of America-United Auto Workers Union Legislative Alliance Director Alan Reuther; and Martin Zimmerman, clinical professor of business administration at the University of Michigan and former chief economist and group vice president at the Ford Motor Company. Martin Baily, director of the Initiative on Business and Public Policy and Bernard L. Schwartz Chair in Economic Policy Development, served as moderator.