What about Cerberus?

President Obama issued an ultimatum to GM and Chrysler today, setting out strict guidelines for the carmakers to meet before obtaining more government aid. Coupled with the forced resignation of GM CEO Wagoner, the Obama administration’s heavy-handed approach to Detroit, as compared to its approach to Wall Street, seems to indicate a double standard. Why not bank CEOs? asks David Sirota. The Huffington Post’s Sam Stein notes that Gibbs struggled to explain the differing approaches.

The irony of this is that a major Wall Street private equity firm actually owns 80% of Chrysler, but has managed to avoid serious scrutiny during the bailout process. Take it from Yahoo Finance’s Tech Ticker:

Curiously, one major stakeholder which hasn’t been asked to make any major concessions yet is Cerberus Capital Management, which controls 80.1% of Chrysler and 51% of GMAC. The private equity firm counts former high-ranking government officials John Snow and Dan Quayle among its board members, and had about $27 billion of capital under management as of December 2008.

It is certainly curious. Cerberus is not even a major patron of Obama or Democrats, based on its top executives’ giving patterns, so the fact that the Obama administration hasn’t focused any scrutiny on the firm is somewhat puzzling. Does it come down to a simple preference for Wall Street over Detroit?

There are signs that Cerberus’ avoidance of public scrutiny won’t last for long, however. Reuters reports that the new bailout is spurring calls for greater disclosure from the private equity firm. Senator Chuck Grassley, for one, is calling their black box approach “foolhardy.”