We dig a good political tell-all every once in a while (how else will we get our political fix while waiting for House of Cards' third season?). Today, we get just that from former Treasury Secretary Timothy Geithner's new book, "Stress Test," which details, among other parts of the 2009 financial catastrophe, the structured bankruptcy that allowed Chrysler and General Motors to emerge as competitive players in the auto industry.
In the book, which is nicely recapped by The Detroit News, Geithner discusses the firing of GM CEO Rick Wagoner while explaining how much trust he had in the auto industry task force that executed the move without his knowledge.

Auto Czar Steve Rattner "didn't even consult me before he fired General Motors CEO Rick Wagoner; if anything, that move increased my confidence in Team Auto," Geithner wrote.

Geithner also details how badly GM miscalculated the government's position while pointing out that President Obama "never seriously" considered letting GM or Chrysler fail. There are some controversial views, however. Geithner defended the decision to go harder on the automakers, while making sure banks didn't suffer to heavily.

It's really worth a read, particularly if you are, like us, a student of the industry and the 2009 bailout. Hop over to The Detroit News website, have a look at some snippets from the book and then let us know what you think in Comments.


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  • 28 Comments
      Revis Goodworth
      • 11 Months Ago
      Why should you believe anything a tax cheat says?
      funguy6713
      • 11 Months Ago
      Hmm...Geithner has a very selective memory and sold out the US taxpayers and middle class and brought a new meaning to the word "Corporate Welfare"...during the Great Recession starting in 2008, Corporate losses were socialized (bailed out by taxpayers) while the profits were privatized...look up the word Quantative Easing...let me help you in simple terms...the US gov't loans billions of dollars to banks/corporation at 0% interest, however that money isn't free because US Govt (Treasury) has to borrow that money from China, Russia, EU, Middle east and has to pay interest....guess who is paying that interest, yep you the taxpayer...Quantative Easing started in 2008 and has not stopped and that's why bank and corporate stocks are above pre-Recession levels...Corporate Welfare and these companies paid back taxpayers by not hiring people and boosting Executive Mgmt pay even higher than before the recession and held back on raises for the guinea pigs on the corporate treadmill...welcome to the New America...
      djrroar1
      • 11 Months Ago
      The banks got off easy and they crucified GM and Chrysler. Wall Street has D.C. in its backpocket. Look at the numbers, Wall Street receive huge money and very little has been or ever will be paid back to the taxpayers. Shameful.
        LXbuilder
        • 11 Months Ago
        @djrroar1
        And yet a dumb American public dwells on the automaker bail outs while forgetting all about the huge ripoff of the American taxpayer funded bailout of Wall Street billionaires. Amazing.
          l5kream
          • 11 Months Ago
          @LXbuilder
          There are numerous polls showing the bank bailouts were very unpopular, possible much unpopular than the auto bailouts. The American public isn't dwelling on the auto bailouts, nor are they forgetting about the bank bailouts, that's just what you think.
        Sanchez
        • 11 Months Ago
        @djrroar1
        Crucified? Those two firms and the UAW got a sweetheart bankruptcy while the bondholders - legally first to get some of their investments back - got screwed. Crony Capitalism is not Capitalism at all...
      car-a-holic
      • 11 Months Ago
      My observation; the bank and auto bailout proved one thing: there is a class stratification among the elites, bankers vs industrialists. Industrialists are still second fiddle millionaires next to criminal bankers who slither away from crime unscathed......
      TOMORROWS HERE
      • 11 Months Ago
      They were bailed out and still filed bankruptcy, costing the US taxpayers billions, Mitt Romney was right to say , just let them file bankruptcy!
        3szoom
        • 11 Months Ago
        @TOMORROWS HERE
        Yes, but who would have loaned them the money to stay afloat during bankruptcy? You're forgetting that in 2009 there was an almost unprecedented credit crunch. Would you rather see a Chinese owned GM or Chrysler?
          William Harper
          • 11 Months Ago
          @3szoom
          And where does that money come from? If you keep up that way of doing things, everything you have will be Chinese owned eventually.
          RexSeven
          • 11 Months Ago
          @3szoom
          Or an Italian owned Chrysler... That seems okay. Who knows, maybe the commies from China would stand up to the unions? It's obvious no one here will.
          Ryth
          • 11 Months Ago
          @3szoom
          No one. Someone would have bought them out or let them fail. If it's foreign so be it but more likely a US venture firm would have. That money wouldn't have come from the taxpayer.
          Larry Litmanen
          • 11 Months Ago
          @3szoom
          I know quality of Chinese GM would be better than US GM.
      • 11 Months Ago
      [blocked]
      RGT881
      • 11 Months Ago
      Mr. Geithner sat on board of new York federal Reserve bank and had quite a cozy relationship with other directors which represented other major banks. I am talking ultra big fish. When the credit crunch occured, Geithner was instrumental in direct discussions with Bernanke and simultaneously pushed on Henry Paulson for the initial $700 billion bailout for the banks. It was then Paulson's job to get congress the approve this and you have no idea about the sheer psychological pressure that was put on the Congress to approve it the second time around. Socialism for the wealthy? You bet. As for the auto bailout, that was done to get the public to shut up, to appease unions and of course make democrats look good. I am more okay with the auto bailout than the bailout of banks, who are in my mind are financial terrorists. Goldman Sachs helped Greece hide its massive debt, only to have that issue blow up later, JPMorgan was the main player in manipulating price of gold, carbon credits, and other various commodities, they were simultaneously pushing for higher regulation standards to choke the competition of smaller banks, Bank of America consistently participated in unethical mortgage modification programs, and rest of the Wall Street were stuffing themselves silly with MBS, but they didn't care because US has a solid record of bailing out incompetent bankers spanning several decades. Meanwhile your average Joe was more than happy to speculate on buying a property with zero down on an adjustable rate interest only 2/28 mortgage because hey home prices would forever go up and interest rates would keep going down. I digress, but Geithner and rest of the Wall Street banks represented on NY Fed, plus Bernanke plus Hellen are unethical, incompetent, disillusional academics.
      thumerzs
      • 11 Months Ago
      As a supporter of the auto bailouts - one still has to wonder why the architects of that policy didn't think to put in place language that would have forced the firms to pay back any shortage owed to the government once (if) they regained solvency.
        Hooman
        • 11 Months Ago
        @thumerzs
        The government bailout was not intended to make GM a more competitive company, it was intended to "repay" the UAW for supporting Obama during his election and re-election. This is the reason that most of the stock holders and investors were not paid back. This is why the stock was re-sold to GM at a loss. If the stock were held a few more months the Feds would have made a nice profit to return to the treasury. The reality is that GM was a highly valued company which would have been quickly purchased by investors or a parent company. We will never know, but I bet the new owners would have improved efficiency and reliability.
      WHO
      • 11 Months Ago
      Interesting plot twist. Barry Soetoro's mother worked for Timith Getihner's father.
      Larry Litmanen
      • 11 Months Ago
      "Geithner defended the decision to go harder on the automakers, while making sure banks didn't suffer to heavily."----------------Bond holders are banks now?
      Sanchez
      • 11 Months Ago
      United States of Goldman Sachs, even if this particular Fed insider never directly worked there.
      rjwatsonmotors
      • 11 Months Ago
      'Geithner defended the decision to go harder on the automakers, while making sure banks didn't suffer to heavily" Shouldn't that be two heavily? lol
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