GM's future at stake as Obama's team steps in

 

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President Obama left a big question mark over the future of the U.S. auto industry Monday when he made it clear he is willing to offer limited aid to General Motors and Chrysler but warned they must restructure much faster or end up in bankruptcy court.

Obama blamed a "failure of leadership, from Washington to Detroit" for bringing the automakers so close to collapse. But his auto task force, he said, had determined that turnaround plans laid out by GM and Chrysler had failed to prove they can turn the automakers around. And over the weekend, the administration signaled its willingness to have the government intervene more directly in their future when it forced out GM CEO Rick Wagoner.

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The president's plan balances two competing forces that are swirling around Americans' economic anxieties: growing public outrage over corporate bailouts and fear that if the auto industry sinks, it will take millions of jobs and the fragile economy down with it.

The White House also has given different courses of action for the two automakers: It made clear it will try to save GM (GM), but Chrysler essentially is being cut loose.