June 1, 2009

"The 31-Year-Old in Charge of Dismantling G.M."

Now, there's a headline.
... Brian Deese, a not-quite graduate of Yale Law School who had never set foot in an automotive assembly plant...

Nor, for that matter, had he given much thought to what ailed an industry that had been in decline ever since he was born....

“There was a time between Nov. 4 and mid-February when I was the only full-time member of the auto task force,” Mr. Deese, a special assistant to the president for economic policy, acknowledged recently....

Mr. Deese’s role is unusual for someone who is neither a formally trained economist nor a business school graduate, and who never spent much time flipping through the endless studies about the future of the American and Japanese auto industries....
Surreal.

77 comments:

Dad Bones said...

So he's smart, but can he sell a car?

Pat Austin said...

Socialism, meet America!

God. Anybody check to see if this kid paid his taxes?

SteveR said...

Well that makes perfect sense.

TitusIsSoHappyToday said...

Kind of reminds me of all the Regent University alums in the justice department.

Monica Goodling, around 30 or so doing all the hiring.

TitusIsSoHappyToday said...

And when interviewing asking illegal questions to candidates.

rhhardin said...

It's too long for me to stand, being a lifestyle article, but I notice the absence of error correction in the plan.

In real life as it used to be, a bad plan was followed by not ever hearing about they guys again. The market fixes errors that way.

In today's life, a bad plan is just followed by a worse plan if needed, and so forth until the revolution I suppose.

John said...

As Glenn would say, the country is in the very best of hands.

traditionalguy said...

The choice for the job reflects Obama's goal for the job. Take the auto industry from its owners and build facism from the remains. Cesar Chavez is an hispanic version of a true Marxist, and Obama is our version. An older and experienced guy might have actually used his knowledge and fought to save the auto industry. Do you remember why the Tom Cruz attorney/character was chosen to defend the accused Marines in the A Few Good Men movie?

Paul Snively said...

Dr. Althouse: Surreal.I'm sorry, Professor, but it's only surreal if you refused to take Candidate Obama at his word during the campaign. John McCain rightly got dinged, and lost a lot of votes, for his honest admission that the economy is something that he doesn't know as much about as he should. President Obama's problem isn't that he's ignorant of the economy; it's that he's hostile to it. My stepson's birthday present this year will be a quantity of silver coins, along with a discussion of debt, inflation, the role of the Federal Reserve, the Treasury Department, and copies of this graph as well as this one.

m00se said...

Man, in a few years they're going to be looking back at this going, "What were we thinking?!?"...

john said...

I checked Amazon and could not find either his autobiography nor his tribute to his father. I assume these are both in press.

Also, is it not time to call for a hiatus on government hiring of NE law school grads?

paul a'barge said...

This is precisely why big government is bad and why Obama is a disaster for America.

Certainly, capitalism has its faults and we all agree with all the regulations, and certainly we all agree that it's pretty much not possible to regulate the risk out of capitalism.

However, when you elect people like Obama, Pelosi and Harry Reid this (31 year old in charge of GM) is what you get. It's as regular as clockwork.

Obama is an electorally transmitted disease (ETD).

David said...

This is ridiculous, but it's also what you get when you run your companies into the ground and become wards of the state. GM was run by 50-60-70 year olds for a long time without success. Can this be any worse (except for the little fact that our government has $70 billion in the enterprise now with much more to come?)

Anyway, he probably has a short attention span. He'll get bored with it soon.

Patrick said...

Paid his taxes?? He probably hasn't earnt enough to pay any yet!!

And now he works for the government, and their salaries are probably tax-free by now, we just haven't been told about it ;(

Pogo said...

A whole car company?

Cool! Neat-o! Gosh!

Jim said...

"I'd like to introduce Blue Star's new president, Bud Fox."

david@dmrecords.com said...
This comment has been removed by the author.
david said...

this youtube video says it all!!!!
http://www.youtube.com/watch?v=5B23TjfKRCA

EDH said...

Jim, you beat me to it with the Wall Street reference.

Although I was thinking of Stewie Griffin instead of Bud Fox.

Big Mike said...

Short run, bankruptcy and liquidation would be pretty hard on the economy.

Long run, it would almost certainly focus the stakeholders -- overpaid senior managers who were Peter-principled two promotions ago, recalcitrant union bosses, board members who are bored members -- of the surviving corporations on a brave, new world where bad companies are not infinitely propped up by the taxpayer and at the expense of well-run companies.

When you're only 31 the short run looks remarkably long.

Palladian said...

Heckuva job, Deesie!

RedRaiderJ! said...

Red State Rockers Rule!

F15C said...

I'm taking a snapshot of articles and pictures of this young man and Obama to save for historical reasons.

Otherwise, twenty years from now, no one will believe that we put one of, if not the, pre-eminent industrial institutions into the hands of someone so blatantly, clearly and inarguable inexperienced.

I bet he grew the beard because they kept mistaking him for one of the middle school kids touring the facility - instead of the guy who is giving GM to the government and the UAW.

SoFlCnsrvtv said...

Yeah Red State Rockers!

No Bailouts!! That's what I'm talking about!

Red State Rockers said...

Thanks for the plug!

goesh said...

- the halt, the lame and the blind continue on with our destiny in their hands...

AJ Lynch said...

Yikes- Yale & Harvard do run the country.

Is it fair to say Yale & Harvard have also ruined the country?

Hoosier Daddy said...

You guys just don't get it do you. Obama is doing something and that's what counts. Results are, well....

tim maguire said...

What? Is this kid really less competant to run GM than Obama is to run the country? Their resumes look pretty much the same.

Prof. Althouse was willing to put our country in the hands of an inexperienced kid, why should she balk at doing the same for GM? Is GM really more important or more complicated than the United States?

g2loq said...

Quote:

"So we are acting as reluctant shareholders, because that is the only way to help GM succeed,'' the president said. "What we are not doing, what I have no interest in doing, is running GM."... Bark Obama

NightBastard said...

a not-quite graduate of Yale Law Schoolso an intern gets to run GM? all Monica got was Leaves of Grass.

glenn said...

I dunno about this one, looks to me like what got GM in trouble in the first place was all those B-School and E-School grads. Dumbest guy I ever met in business was an MBA from a top 10 school. If this guy is willing to listen and separate the wisdom from the self serving bafflegab he'll be OK.

rocketeer67 said...

If this guy is willing to listen and separate the wisdom from the self serving bafflegab he'll be OK.

Oh, good grief. He voted for Obama. He's already demonstrated he's not capable of separating wisdom from bafflegab.

Elliott A said...

A 2 year old can dismantle anything. By 31 he should be an expert. They'll get someone different to make the company properly fit the dialectic

Ralph said...

GM was run by 50-60-70 year olds for a long time without success
They did pretty well for 70 years. The last 30 they've been seriously constrained by unions, too many retirees, and government regulations.

This is what Social Security and Medicare will do in a few years, barring massive immigration of young people.

Greg Toombs said...

He's at least as qualified to do his job as Obama is to be President.

John Stodder said...

Is this the worst thing about Obama? These auto bailouts? I think so. He claims he is saving GM, but he knows he's lying. You can't save GM by letting UAW dictate company policy in league with the environmental lobbying groups. He could have saved it (and so could have Bush) by letting it fall into a normal bankruptcy.

The stimulus package was pretty bad. His budget is egregious. But both are subject to change over time. The GM maneuver is not amenable to reversal. Then you add that he's put this tyro weeny in charge of it... Yeah, a fair accounting of history will say GM was Obama's killer rabbit.

jdeeripper said...

Obama is President, Brian Deese is running GM and Mitt Romney is unemployed.

Yes, it is surreal.

PJ said...

This guy's most important task will be drafting regulations that are guaranteed to give GM a competitive advantage over privately-owned manufacturers, aided by advance knowledge of the technical specifications of GM's forthcomong automobiles. I think he's probably up to the job.

save_the_rustbelt said...

There is a presumption in the government that lawyers can do anything - Secretary of State, Secretary of this, Secretary of that.

So it is perfectly logical to put a snot nosed lawyer in a job where he is totally unqualified.

Sean E said...

Actually reading the article, this seems to be more a case of an overly-enthusiastic headline writer than anything else. The guy just sounds like an analyst who may or may not have the ear of Obama and Summers.

Total puff piece.

save_the_rustbelt said...

Hey, the almost lawyer slept in a GM parking lot on his way to Washington - he really is well qualified.

Steven said...

As a 31-year old, I just want to point out that I would be totally qualified to run the whole auto industry effort, despite having never been employed in a manufacturing business.

AJ Lynch said...

Well at least Deese owns a car. Most of Obama's top advisers don't drive or only rarely drive.

With all these plant closings and dealer closings, I wonder if young Deese should have a bodyguard now that he has been unmasked?

ic said...

Why does it matter? He is the front man for the UAW union bosses anyway.

And the bosses decreed that our Motor is going to make compact cars that we are to buy. The bosses also decreed that our Motor is not importing the tiny cars from China but will make them ourselves, so patriotic Americans can pay whatever left of their post-tax paychecks to buy the little gems. Patriotic Americans are paying for the cars anyway, as subsidies, might as well get a lttle thing to drive to the grocery stores.

Brother J said...

Yet another character appears from "Atlas Shrugged"; the Wetnurse. Just wonderful.

tbrosz said...

Ah. Rand's "Wet Nurse" finally makes an appearance.

Big Mike said...

As a sixty year old, am I twice as qualified, or only half as qualified?

richard mcenroe said...

"Man, in a few years they're going to be looking back at this going, "What were we thinking?!?"..."

Moose, no they won't. They'll be pretending this never happened and if it did happen, THEY certainly had nothing to do with it.

I mean, really,if they can forget the killing fields of Cambodia, you think they can't forget voting for Barack Obama?

AJ Lynch said...

Stodder:

The auto takeover shows Obama knows zip, nada, nil about economics. That suggest he is ignoring the advice of far more knowledgeable advisers.

I said it before- Obama has not made even one good decision re the economy IMO.

g2loq said...

“My administration, is the only thing between you and the pitchforks.” Bark Obama to Banking executives

Zach said...

In fact, from before Inauguration Day, few in Mr. Obama’s circle saw any other choice. Every time Mr. Deese ran the numbers on G.M. and Chrysler, he came back with the now-obvious conclusion that neither was a viable business, and that their plans to revive themselves did not address the erosion of their revenues.
...

“The president’s instruction to us was that we had to come up with a solution that would work on a commercial basis, that didn’t involve indefinite federal financing,” Mr. Deese said. “But we didn’t want liquidation, which would have even worse effects. So the question was how do you design a very substantial restructuring, and do it fast.”
...

(taken from earlier in the article)
A month ago, when the administration was divided over whether to support Fiat’s bid to take over much of Chrysler, it was Mr. Deese who spoke out strongly against simply letting the company go into liquidation, according to several people who were present for the debate.

...“And there he was in the Roosevelt Room, speaking up vigorously to make the point that the costs we were going to incur giving Fiat a chance were no greater than some of the hidden costs of liquidation.”


So not only do you put a 31 year old not-quite-graduate of Law School in charge of a $70 billion bailout, you tell him his first analysis isn't good enough. He then finds "hidden costs of liquidation" that justify doing what the boss wanted to do in the first place.

This is why being smart and hard-working isn't good enough. He doesn't bring any independent expertise to the table, and the boss was able to lean on him for a favorable analysis.

Dust Bunny Queen said...

Is this the worst thing about Obama? These auto bailouts? I think so. He claims he is saving GM, but he knows he's lying. You can't save GM by letting UAW dictate company policy in league with the environmental lobbying groups. He could have saved it (and so could have Bush) by letting it fall into a normal bankruptcy

In addition, Obama has killed the bond market and guaranteed that we will soon be looking at double digit interest rates.

Who would be stupid enough to buy a bond from the new and improved Government Motors company when you can get hosed at any moment by the Grand Poobah in the White House? I am not investing my client's money into any individual bonds in the US and especially NOT into any companies that are currently unionized or potentially will be forced to unionize. The danger of being treated like the GM bondholders is just too big at this time. Plus the current interest rates are much too low on short term bonds, considering that in a few years (maybe less) we will be able to pick up debt instruments at much higher rates. Too bad for the economy, however. If you need to buy something or want to borrow money...do it NOW.

Foreign bonds are much more attractive, plus we will be able to take advantage of the dollar's future and continuing decline against other currencies.

Zach said...

Also, notice the comparison between the "costs we were going to incur giving Fiat a chance" and the "hidden costs of liquidation". One is a direct cost, one is a hidden cost. The standard of comparison is that the direct costs are "no greater" than the hidden costs.

"No greater" is a weasel term. It suggests that the costs are smaller, without doing a fair comparison. Did Deese estimate the hidden costs of a takeover? Are the cost uncertainties comparable between the two estimates, or is the uncertainty of "hidden costs" much higher.

You've got to have some rigor when comparing something relatively certain to something relatively uncertain. There's always a temptation to fudge. At the very least, you have to look as hard for hidden costs of your preferred policy as for the policy you oppose.

Ralph said...

If you need to buy something or want to borrow money...do it NOW.
This makes sense to me (borrow ahead of inflation), so why do the talking heads say everyone is de-leveraging? Am I missing something here?

It would have been smarter to let Chrysler go into liquidation in December. This would have made GM & Ford's survival and recovery easier. Jeep, the minivans, and Dodge trucks were its only good parts, but CAFE will sap the life out of the American companies because it forces them to sell more and more unprofitable (at union wages) small cars.

Big Mike said...

@Ralph, I had been harboring a secret dream of using a hemi-powered Challenger to ease my way into a second childhood. :-(

David said...

Ralph said...

[GM] did pretty well for 70 years. The last 30 they've been seriously constrained by unions, too many retirees, and government regulations.
But that's the point, Ralph. Management let these costs eat up the company and was ineffective in making its case about regulation.

Contrast GM with Caterpillar. Cat took a huge strike from the UAW in the 1990's that caused a lot of criticism of management at the time. But unlike GM they got labor costs and work rules under control and are now a world class company.

Both Cat and GM were successful at overseas expansion. But that was the easy part, comparatively. GM's giant domestic liabilities dragged down the overseas successes.

We are appropriately quick to blame federal governmental failures on the President and Congress. Management bears the ultimate responsibility for GM's demise, not the unions or the government.

holdfast said...

Blogger john said...

"Also, is it not time to call for a hiatus on government hiring of NE law school grads?"

But, unless I read it wrong:

"But that, in short, is the job description for Brian Deese, a not-quite graduate of Yale Law School"

He isn't even a law school grad - did he quit, fail out or take a leave to work for Obama?

montana urban legend said...

Can't do a worse job than GM did to itself over the last 45 years.

I love the idea of snarking on the kid's age, as if commenting on his supposed lack of experience is a valid tack coming from a bunch of nobodies with no experience in the auto industry, or economic policy.

Have any of you actually ever been to Detroit?

Shit like this reminds me of when the flyover people thought they had a right to outsource the risks of their incompetence in national security and foreign policy to the residents of NYC and other large cities.

Breathe deeply and remember this: Not every remarkable thing is an outrage.

ted said...

As we all know, the hiring of this totally unqualified hack is all Bush' fault.

And in the future when Obamanomics and Obamasecurity are unmitigated disasters, not failures, disasters, how will the MSM spin it to be conservative\Republicans fault?

montana urban legend said...

"You can't save GM by letting UAW dictate company policy in league with the environmental lobbying groups."Right John. Because Honda and Toyota's weakest link are those go-nowhere hybrids and other efficient mileage models.

Other than John, was anyone aware that GM and Chrysler were DOA as of 2005 - 2006? Let's see a show of hands on this. And bonus points for this one: Who will attribute that in any part to their retarded marketing decisions from 2001 onward? Hummers during a time of oil prices greater than $100/barrel? Cars that no one but Americans would have bought, or would have been stupid enough to have bought?

GM's former overlords will have a great time working in the companies of some of the people on this very chat site.

montana urban legend said...

Anyone who writes in here thinking that they are saving capitalism by pretending to defend GM and Chrysler (and by extension, American industry) from the likes of Obama, has no credibility promoting themselves as a partisan of the so-called "Party of Business".

If this is the best analysis of the American auto industry that you can offer, and you are a Republican (or just get your rocks off pretending to be opposed to Obama/Summers' handling of the Big Two), then you have absolutely no credibility in economic matters.

Please, just give up while you're behind. It's painful enough to watch people destroy themselves. To watch them doing it while proudly believing that they are defending a cause that they've pissed on as much as the right wing has pissed on the American economy, though - well, that's just embarrassing and pitiful. And given the consequences of your party's horrible leadership over the last 8 years, consequences that the rest of the country's had to live with, absolutely shameful.

For the love of God, give it up. Throw in the towel. The coalition held together by social conservatism and business interests over the last 40 years is over. It's finished. Too bad you never got the memo.

It's already become like watching sympathizers of the Confederacy re-enacting Civil War battles. Such valor. Such glory. Such pawns in yesterday's game.

Na-na-na-na.
Na-na-na-na.
Hey-hey-hey.
Goodbye.

veni vidi vici said...

I don't care how old he is. Youth can be a source of fresh ideas, so it's a nonstarter.

On the other hand, I think the single-most important question, particularly in light of the flavor of management candidates the auto companies have had over the past few uninspired decades is:

But is he a car guy?

It (still) matters, you know.

veni vidi vici said...

"The coalition held together by social conservatism and business interests over the last 40 years is over. It's finished. Too bad you never got the memo."

Dude, how so very 1990's of you to say!

Reminds me of all that right-side talk about the "conservative realignment that'll last a generation" from somewhere around 2004. Before you get too far with that, though, I'll say that yes, you *do* sound as foolish as they did then.

Carry on!

Pogo said...

Gee, I remember calling Barry a socialist on this very site before the election and the lefties said noooooooooo, he's not a socialist.

And now BHO is CEO of Government Motors.

Socialism has fucked up everything it has touched so far in every other nation.
And now ours.

AJ Lynch said...

Montana Urbam Legend In His Own Mind asked:

"Have any of you actually ever been to Detroit?"

Yes I even went to the Henry Ford Museum. I highly recommend it to anyone who goes to Detroit. It is on the south side and maybe 15 minutes from the airport is what I recall. Great place to spend a half a day if you have time to kill before a flight.

Palladian said...

"Socialism has fucked up everything it has touched so far in every other nation.
And now ours."

No no no, Pogo! You see, it's just that it has never been properly implemented! Barry's going to finally do it right, you see?!

Ralph said...

m u l, Detroit made trucks because they were able to sell them at a profit. They lose money selling most of their car lines, largely because of the cost of retirees. IIRC, last year GM had about 4 retirees for every active worker.

Sort of like SS and Medicare, which the Dem party refused to reform, and the Repubs made worse with the drug benefit. The management of the government has been as reckless and feckless as GM's in the 80's, but at much bigger stakes.

Zach said...

Other than John, was anyone aware that GM and Chrysler were DOA as of 2005 - 2006? Let's see a show of hands on this. People have been predicting a GM bankruptcy for years.

Fair is fair, now. Show of hands of people who knew that this was the level of "analysis" the Obama administration was going on for a $70 billion bailout before today.

Next, show of hands who believe this is an appropriate level of analysis.

Pogo said...
This comment has been removed by the author.
Pogo said...

New movie this summer from Obama Productions:

The 31 Year Old Business Virgin.
31-year old Brian Deese has gone his entire life without managing a business. His friends at the law school want to correct that situation. They make it their mission to find Brian a business to run. They believe it will happen when Brian meets Obama, a 47-year old President, who runs a government across the street from his school.

Penny said...

Why is Deese qualified?

“Brian grasps both the economics and the politics about as quickly as I’ve seen anyone do this,” said Lawrence H. Summers, the head of the National Economic Council who is not known for being patient whenever he believes an analysis is sub-par — or disagrees with his own."

In shortened form, he grasps politics and agrees with Larry Summers.

Steven said...

Right! The Big Three's managers just stupidly blundered into making trucks. If every company in a given country does the same thing, we should credit or blame that on the management of the individual companies, not look at the thing all the companies had in common, like the government policies of the countries those companies are based in.

I mean, it's certainly not like U.S. government policies like differential tariffs and CAFE requirements constituted a massive economic pressure for U.S. manufacturers to specialize in trucks for its domestic market. Or that Japanese gas taxes constituted pressure for companies in those countries to specialize in small, light, fuel-efficient cars for their domestic markets.

Clearly, the Japanese companies actually had universal forewarning that oil prices were going to suddenly rise in a massive speculative bubble, and wisely adjusted for it, while the U.S. companies were too stupid to foresee the bubble enough years ahead to make changes that require multiple-year lead times in tooling and such.

Thank you, Montana Urban Legend, for your insight.

montana urban legend said...

Thank you Steven for getting it.

I'll consider your comment to be a sufficient response to Ralph. Whether he (or anyone else) understands the difference between long-term survival and more capricious short-term goals is an open question, and one that I'm not sure businesses get to forgo, let alone pretend away as dictates of a "socialist" government conspiracy.

Does everything really have to be spelled out in such elementary terms for this crowd?

AJ Lynch Mob kindly informs me that he has been to the Henry Ford Museum, apparently in a half-day layover before a connecting flight. A more extensive tour of Detroit would have presented him with evidence of a city that is unlivable and half-vacant, with greater unemployment than any other major city of comparable size, filled with brownfields and a crime rate that would have him running to escape to the relative safety of a bad neighborhood in Camden. But I suppose it takes a really short-sighted person to defend the short-sighted.

That is what you're trying to do, right AJ?

For the benefit of people who have trouble seeing things unless they're right in front of their face. (More undeniable fruits of the American auto industry's parasitism of the regional and national economies).

Quayle said...

OK, with the GM debacle, its time for the Obama voters to fess up to the country:

You're appalled, aren't you.

Even you can't believe what you are seeing.

jonstrau said...

Another nationwide search ends at the Yale Law school hiring hall. How many more? Haven't we learned from Hillary or Bush (just Yale). How much more misery are we the people going to let this greenhouse of Democracy's deconstruction nuture? No wonder they wanted to let the terrorist in up there - he was a legacy! I thought we elected President Obama, a Harvard man, to put a stop to this madness. How many Sotomayor, Mister Speaker, how many more?

principlex said...

Obama is anti-experience, anti-knowledge, maybe even anti-brains. All are a threat to him. When someone asks him a question, he starts to get mad unless, of course, he's clear he planted the question. I'm not sure but Geithner isn't in the same boat.

Another thing he likes is if they are compromised for some reason.