Is Obama taking over the auto industry?

By Meredith Ray

Staff Writer

The Obama administration adopted an ‘industrial policy’ on March 30, which will determine the products the auto industry can make and the future of these companies. The policy was adopted in his attempt to save American automakers, but many say it steps over the line of government.

"There’s always been a line over which no president would cross with respect to the distinction between the public and private sectors. Obama has now crossed that line where there is no limit to government’s destruction of private activity or control over it," declared Rush Limbaugh in his daily radio broadcast.

The automotive task force has decided that Rick Wagner, CEO of GM, should step down, that Chrysler should merge with Italian automaker Fiat, that GM is still relying too much on trucks and SUVs and that GM’s Chevy Volt, a new electric car, is too expensive for the marketplace.

These decisions are typically reserved for the boardroom or corporate meetings, but now the decisions are coming from the White House. This notion has drawn intense criticism from conservatives.

"When did the president become an expert in strategic corporate management?" asked Rep. Tom Price of Georgia, chairman of the conservative Republican Study Committee. "The federal government is famous for its mismanagement, yet this administration continues to demonstrate its certainty that Washington always knows best."

The Obama administration adamantly defends their actions and points to other presidents who intervened in tough economic times.

Obama’s actions are "consistent with the pattern of presidents acting during economic crises," said Allan Lichtman, a professor at American University and an expert on the presidency. "And it’s absolutely consistent with patterns of presidents intervening to make sure major components of the economy don’t fail."

During the Great Depression, Franklin D. Roosevelt limited agricultural production to boost farm prices. In 1971, Richard Nixon froze wages and prices in an attempt to roll back inflation.

Nonetheless, the Obama administration has entered challenging political territory and officials continue to downplay the notion that Obama is taking over the auto industry.

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