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Shields and Brooks Mull Auto Rescue, Blagojevich Scandal

December 12, 2008 at 6:30 PM EST
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Political news took a dramatic turn this week with the corruption charges levied against Illinois Gov. Rod Blagojevich. Mark Shields and David Brooks mull the Blagojevich story and the debate over aid for automakers.
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JIM LEHRER: OK, Mark, pick up on that. Where does this thing go? How do you — listening to what you’ve just heard, what Gettelfinger said, what happened last night in the Senate, what’s going — and what the administration may or may not do now on its own?

MARK SHIELDS, syndicated columnist: Well, I think the administration is going to act, Jim.

JIM LEHRER: They’re going to act?

MARK SHIELDS: I don’t think there’s any question about it. I think, for good reasons and for historical reasons, they don’t want the collapse and the disappearance of the American automobile industry and the manufacturing base of the country to occur on George Bush’s watch.

So they made a good-faith effort, the White House did. They went to the mat. They did everything they could. They’re running out of political clout. They weren’t able to deliver Republicans on the Hill. Josh Bolten worked hard. The entire Republican…

JIM LEHRER: White House chief of staff.

MARK SHIELDS: White House chief of staff. It was a good-faith, authentic effort on their part. And they failed in the Senate. They could not move Republican votes. And it was…

JIM LEHRER: So it’s up to them now to…

MARK SHIELDS: And so I think they’ve made the decision that it’s not going to happen on their watch.

JIM LEHRER: You see the same result coming?

DAVID BROOKS, columnist, New York Times: Yes. The White House has certainly made the decision…

JIM LEHRER: I mean, the White House?

DAVID BROOKS: … it’s not going to happen on their watch. They’re going to give the money.

I thought the Corker plan, Bob Corker’s plan, was what a restructuring looked like. Everybody talks about restructuring, gives lip service to the idea. Who actually has a plan for restructuring? Corker actually had a plan.

And it looked like the sort of conventional plan that you get in a Chapter 11 or in a restructuring. The people who own the debt, they take some cuts. The union take cuts, maybe a $10-an-hour cut, or some sort of cut. And so there’s pain spread around.

But I think, as Ingrassia said, why should the unions or why should anybody make the concessions if they’re going to get the money for free the next day from the White House? So they knew they were going to get the money for free the next day from the White House. So why should they sign on to the Corker plan?

And so I think the bottom line is the American people or the political process has decided we can’t let the auto industry fail.

So if that’s your underlying rule, how do you force restructuring? How do you ever force restructuring? Do we just keep giving $14 billion here, $14 billion there, $14 billion there? Who’s going to force the restructure?

Restructuring is imperative

David Brooks
New York Times
I mean, this is not the simple class warfare argument. In the first place, the shareholders of Bear Stearns and AIG and Merrill Lynch, all these people took huge hits, huge hits.

JIM LEHRER: Do you buy that very premise, that this country cannot afford for the big three to fail, as a general premise?

DAVID BROOKS: Well, I guess the way I would rephrase it is -- I'm not an expert on the auto industry, but people like Paul Ingrassia are, and many other people are, and I think there's a general consensus shared from George Bush to Barack Obama to Nancy Pelosi that this industry cannot survive in its current form. It has to be restructured.

JIM LEHRER: But restructured...

DAVID BROOKS: So the question is, how do we do that?

JIM LEHRER: How do we do that? But you buy into the idea, it has to be restructured, but it has to survive, right? I mean, whatever you...

DAVID BROOKS: Well, I don't know what...

DAVID BROOKS: Well, I guess we're going to have cars made in this country.

JIM LEHRER: OK, all right. We have to have cars made in this country?

MARK SHIELDS: I think it's more than having cars made in this country. I think it is -- we have been the arsenal of democracy. And I think it's crucial to our -- not only to our identity, but to our mission as a nation.

I would say this, Jim, that I found it fascinating to watch the Congress respond. When the titans of Wall Street came up, there were no questions asked about pay, I mean, the fact that the CEO of Merrill Lynch, which went basically a dependency condition, was paid $240 million in 2007, that the CEOs of Bear Stearns and Lehman, that there was a certain frowning upon AIG going to these resort spa retreats at $400 a day, but when it comes to blue-collar workers, all of a sudden, these guys become the avenging angels.

My goodness gracious, a guy who packs a lunch and punches a clock, I mean, you'd think they were raiding the public treasury.

DAVID BROOKS: No, I've got three objections. First of all, I mean, this is not the simple class warfare argument. In the first place, the shareholders of Bear Stearns and AIG and Merrill Lynch, all these people took huge hits, huge hits.

Second, a lot of these financial houses are fundamentally viable companies in the way the auto industry is not. The auto industry -- the big three have been in trouble long before this problem. They have been in a long-term decline. And they need a much more fundamental restructuring.

Companies had to be propped up

Mark Shields
Syndicated columnist
But was there any sense that these guys were overpaid? Was there any reprisal on the part of Congress saying, "My goodness, you guys just come in here, you're raiding the public treasury, you're looting taxpayers' dollars."

DAVID BROOKS: And then the final point to be made is the finance industry is something we need for American capitalism to work. Nobody likes those companies. Nobody likes the way Citigroup and they have been run. Nonetheless, without viable financial markets, we do not have an economy. And, therefore, you had to hold your nose and prop those people up.

And they took pain on Wall Street. The deeper problem with Detroit is it's a longer-term problem and that we've been bailing out for a while.

MARK SHIELDS: They took pain. They took the money. There were no conditions on the money. The money has not gone -- there was no percentage they had to loan, and they have not loaned any to the precise percentage.

They have bought other assets. They've bought other banks. They've paid dividends. They've settled their debts. I mean, it's an entirely different treatment of these people from Wall Street.

David talks about the necessity of credit. Nobody argues about the necessity of credit.

But was there any sense that these guys were overpaid? Was there any reprisal on the part of Congress saying, "My goodness, you guys just come in here, you're raiding the public treasury, you're looting taxpayers' dollars." But, for goodness' sakes, autoworkers, I mean, really, they were treated like Daddy Warbucks.

DAVID BROOKS: Well, a couple things to be said. I don't want to be the one defending the TARP as something effective, because I have long argued that it is not effective. I do think there was a reason to go in and try to save the financial business.

MARK SHIELDS: Yes.

DAVID BROOKS: I also think -- and I'm just following the conventional wisdom here -- which is that the auto industry has deep structural problems which would exist even without this current economic crisis, and they have partly to do with the workers, but they have primarily to do with the products and the companies and that, when I go out and test-drive a Detroit car, I don't want to buy the thing.

Blagojevich's conduct 'pathetic'

David Brooks
New York Times
This guy, he's like he's re-enacting a scene from the "Entourage" or from "The Godfather." He's like re-enacting. It's pathetic, basically, the way he's behaving, $500,000 for a Senate seat, when he knows people are likely to tape him?

JIM LEHRER: I think we could keep this going here for several more minutes or longer, and there's not going to be an agreement, so let's go to something we agree on, David, the governor of Illinois. Express your shock.

DAVID BROOKS: I think he's a great guy. I'm just trying to stoke disagreement.

No, you know, it's like first is tragedy, then there's farce. I covered Chicago politics back in the day of the machine, and Fast Eddie Vrdolyak, and that was tragedy. That was really ruining a city.

This guy, he's like he's re-enacting a scene from the "Entourage" or from "The Godfather." He's like re-enacting. It's pathetic, basically, the way he's behaving, $500,000 for a Senate seat, when he knows people are likely to tape him? It's just -- it's just amazing. You know, you can -- well, anyway.

JIM LEHRER: Well, what about the point, though, that a lot of people are making, Mark, that the only thing Blagojevich did that's different than the normal course of human events is that he was gross about it and he said it -- he didn't say it publicly, but he said it -- there's trading that goes on all the time over Senate -- the appointment of senator -- of empty Senate seats.

MARK SHIELDS: There are.

JIM LEHRER: What's the big deal here?

MARK SHIELDS: There have been some authentic giants appointed to the Senate in the 177 senators who've been appointed since we first began electing senators popularly in 1913. George Mitchell, a great senator.

JIM LEHRER: No, but I mean there's always been trade-offs. That's what I'm saying.

MARK SHIELDS: No, no, I mean, but there -- I mean, the product is the test.

JIM LEHRER: Right, OK.

MARK SHIELDS: And whether we come up with an Arthur Vandenberg, who was responsible for the Marshall Plan, Sam Ervin of the Ervin Committee, I mean, they were all appointed senators. So they aren't all stumblebums who were just some sort of political reward.

Jim, when governors sit down to appoint a senator, they don't say, "You know, which one of these guys is going to be Henry Clay? You know, should we get Webster or Clay, maybe a Calhoun?"

They want somebody who's not going to be under indictment or detox in six months, but at the same time there are political considerations. This guy took it -- governor of Illinois -- took it to a level or a depth so beyond in terms of craven, avariceness, greed, amorality. I mean, it truly was.

I'll tell you how dumb this guy is. Since the Congress of the United States began 219 years ago, there have been 11,991 members of the House of Representatives, of who he was one. He served three terms.

Every one has one thing in common: They were elected. That's the only way you can get to the United States House of Representatives.

In his discussions on tape, the FBI has, he's talking about whether they can get some money for an interim appointment to Congressman Rahm Emanuel's seat, who's become the chief of staff to President-elect Obama, I mean, not even knowing that nobody is appointed to the House of Representatives. I mean, their cravenness and their stupidity merged.

DAVID BROOKS: Yes, we respect high-level incompetence and corruption, but the incompetence...

JIM LEHRER: But you don't -- but that's what I'm actually essentially asking here, is that -- is that he just went over the line of something that is the way you do business.

DAVID BROOKS: Well, no. But you don't do -- you don't sell it for $500,000. You don't talk in those craven terms. People do. They do things that are in their own political interest. But you do not say, "I have something of value. I am not giving it away for free, or else I'll take it myself," the things he was saying.

And, again, I just look at him psychologically as someone who is playing out a role. He knew he was under investigation. He knew he was likely to be taped.

You're talking about somebody who is -- it's not like an old Tammany Hall boss. This is somebody with much deeper problems who like had seen what he imagined a manly man acts and he was trying to play out that role.

'He won't go away'

Mark Shields
Syndicated columnist
If Fitzgerald turns up another conversation from any Obama person or anything comes out afterwards, it's going to be seen as a cover-up. And his credibility, his transparency, Obama's, is the coin of the realm right now, and he'd better protect it.

JIM LEHRER: Now, but the next question is -- he won't go away. I mean, apparently he didn't get the word that he made a mistake, and he's not going to resign. And Lisa Madigan, the attorney general, is going to try to get the Illinois Supreme Court to throw him out. Then there could be impeachment or whatever. This could still go on for a while, right?

DAVID BROOKS: Right, well, it's why some of us went into journalism in Chicago, for exactly this kind of story.

MARK SHIELDS: Just one person who deserves a lot of credit here. A one-term Republican senator from Illinois, named Peter Fitzgerald, is a conservative Republican. He did not -- he was elected in 1998, did not run for re-election in 2004. Barack Obama won his seat.

He was the one, when the Republicans won in 2000, when George Bush was elected president, insisted on one thing, that the U.S. attorney in Illinois, over the objections of Denny Hastert, the entire Republican organization, had to fight the White House on it, that it be Patrick Fitzgerald, no relation, that you bring in a U.S. attorney from outside.

He was inspired, interestingly enough, by the example in Richard Norton Smith's biography of Colonel McCormick, the founder of the Chicago Tribune, who, to get Al Capone, came to Washington and said, "We can't do this with local attorneys."

The fact that Illinois is being cleaned up, painfully and awkwardly...

JIM LEHRER: An outsider came in?

MARK SHIELDS: It's Patrick Fitzgerald. And if I had any say over who the next senator ought to be from Illinois, I would say it ought to be Patrick Fitzgerald. I don't know what his politics are.

DAVID BROOKS: Hmm, that...

JIM LEHRER: Does Jesse Jackson, Jr., have a problem as a result of this?

DAVID BROOKS: I think at least a perceptual problem. Obama does not, but I think he has a problem.

I think there are weird spillover effects. Even Caroline Kennedy in New York who was talked about getting a seat, I think it's much less likely she gets a seat, because you want to do something not seen to be rewarding somebody who is not a natural senator.

JIM LEHRER: Do you agree there's going to be fallout here?

MARK SHIELDS: There is. I mean, Obama...

JIM LEHRER: Outside of Illinois?

MARK SHIELDS: The Obama people and Obama himself have pledged that they will reveal all contacts. There were contacts; there had to be contacts. We're talking about filling a United States Senate seat that the president-elect had held.

If, in fact, when they do come out, there better be everything in it, every single...

JIM LEHRER: Everybody who talked to everybody, what day, what they said?

MARK SHIELDS: Everything, because if Fitzgerald turns up another conversation from any Obama person or anything comes out afterwards, it's going to be seen as a cover-up. And his credibility, his transparency, Obama's, is the coin of the realm right now, and he'd better protect it.

JIM LEHRER: In a word, do you agree with that?

DAVID BROOKS: Yes, though it's taken him a little while. It's already been four or five days.

MARK SHIELDS: Yes, I would take time and be complete rather than rushing into it.

JIM LEHRER: All right, thank you. As we are always, thank you both very much.