D.C. to Detroit: Die Another Day
The New York Times, Wall Street Journal, and Washington Post all lead with a rundown of the blood transfusion for two of the ailing Big Three: General Motors and Chrysler will collectively receive $13.4 billion by January, with another $4 billion on the way if Congress approves the second half of the $700 billion bailout package, from which loans will be drawn (find the quick-and-dirty version here). In exchange, the companies are expected to produce plans for long-term sustainability by the end of March, with a laundry list of stipulations from the outgoing administration. The Los Angeles Times leads with California Attorney General Jerry Brown's 111-page legal brief arguing that Proposition 8, the voter-approved constitutional amendment banning gay marriage in the state, should be thrown out on the grounds that "the amendment process cannot be used to extinguish fundamental constitutional rights without compelling justification." A familiar face will defend the proposition in court: Ken Starr of blue-dress fame.
Auto CEOs Rick Wagoner and Robert Nardelli breathed sighs of relief at the news—President Bush opted not to force their companies to restructure through Chapter 11 bankruptcy, riling Republican free-marketeers in the Senate. But although the Journal calls the lifeline "generous" and the guidelines for reform "nebulous," they're still far from home free: The administration has hesitated to request the second half of the bailout package from Congress, which it could still refuse upon reconvening Jan. 6, despite Henry Paulson's warning that there's only $2 billion left in the original $350 billion pot. The papers agree that the plan as written punts the brunt of decision-making to the Obama administration, which will have to face—among other horrors—a United Auto Workers union unhappy with the recommendation that wages be slashed to the level of nonunion jobs at competing car companies, the Post reports.
What do the companies actually have on deck for the post-carpocalyptic era (terminology h/t Jalopnik)? Not much, says the NYT. While Ford and GM have a few marquee renewable-fuel vehicles, along with plans to convert more conventional models, Chrysler seems helplessly wedded to its jeeps and jalopies. Low gas prices complicate the picture further, since consumers are reluctant to pay more for a car that won't save them as much at the pump. (Oil companies are doing their best to stop the freefall, with oil prices down 77 percent in five months.) Ford, meanwhile, didn't come begging for cash (besides the $9 billion line of credit it has already requested) and so will not be subject to government oversight and potential 20 percent ownership stake in Chrysler and GM. This looks to be a smart move, the Journal points out: Ford will still benefit from the concessions obtained by its brothers-in-arms from unions, suppliers, dealers, and debt holders. And another ray of hope, the Post notes: More help could be coming from Canada!
In the epic culmination of its delighted coverage of the Bernie Madoff scandal, 11 NYT reporters (book deal alert!) pieced together the whole sordid story, from Madoff's start as a 22-year-old in the 1960s to his end, telling his sons in their living room that the game was up. To feed the ever-ballooning scheme, Madoff had hurtled at "undignified" speed to gather cash in Europe and Asia before the financial crisis drained the water from his swamp. The Journal has a spreadsheet of those who went down with him.
President-elect Barack Obama wrapped up his Cabinet appointments in record time yesterday with the selection of Rep. Hilda Solis, D-Calif., for labor and Rep. Ray Lahood, R-Ill., for transportation, as well as picks for trade representative and the Small Business Administration. (See the full team with the WSJ's disturbingly high-school-yearbooklike interactive graphic.) The Post observes that they're mostly all moderates, making few constituencies completely happy. The NYT contends that the choices emphasize domestic over foreign affairs, via new positions for energy, urban policies, and health care. The most controversial of Obama's choices, though, is someone who will hold no portfolio at all: evangelical minister Rick Warren, the purpose-driven Prop 8 proponent slated to give the inaugural invocation. For all its symbolic value in reaching out to Christian conservatives, this one might be more trouble than it's worth.
There are still a few question marks in the Senate, which is moving oh-so-slowly toward resolution. The LAT reports that Al Franken has taken the lead over Norm Coleman in Minnesota, but neither of them is likely to start on the first day of school for senators next month, with the recount expected to last into mid-January. In New York, the NYT (with its maddeningly secret sources) digs up that Attorney General Andrew Cuomo *—until recently the favorite for Hillary Clinton's vacated seat—is "fuming" over the sudden popularity of Caroline Kennedy and her fundraising magic. And out in Illinois, Gov. Rod Blagojevich is fighting it out until the end. "I have done nothing wrong," he announced yesterday, refusing to resign his post as the Illinois establishment stood by in disbelief.
In perfectly legal banditry, six Harvard investment fund managers made out with $26.8 million in collective annual salaries last year—15 percent more than the previous year, the WSJ reports, which is pretty good considering the fund lost 22 percent in the quarter ending Oct. 31.
Who knew that Hot Topic would be the one chain store in the right place at the right time? Niche retailers such as the ubiquitous goth outfitter are doing well even by the new metrics of a down season, which involve things like real estate and asset portfolios, the NYT reveals.
N.B.: Today's NYT will likely not be available to those TP readers logging on from China, where access to the site has apparently been blocked—not by China's own admission, but the Times' own inference. Other new sites, which had been unavailable earlier this week, have gone back online. The Times says it's not a technical problem on their end.
Correction, Dec. 22, 2008: This article originally referred to the attorney general of New York as Mario Cuomo. The attorney general is Andrew Cuomo, the son of former New York Gov. Mario Cuomo. ( Return to the corrected sentence.)
Lydia DePillis is a writer living in New York.