Unsurprisingly, The Beard wants nothing to do with lending to big auto. Who does? (No one we hope). Still, its surprising to see someone with some backbone out there. To wit:
While the Fed has used emergency-lending authority over the past year to aid financial firms, short-term debt markets and mutual funds, those decisions were aimed at financial stability and the broader economy, Bernanke said. By contrast, Congress is "best suited" to determine whether to assist a specific U.S. industry, he said.
"Even if the companies have sufficient collateral, lending to an auto manufacturing company would represent a marked departure from that policy, and would take us into distinctly new realms of policymaking," Bernanke said. "In particular, it would raise the question as to whether the Federal Reserve should be involved in industrial policy, which has traditionally been outside the range of our responsibilities."
Finally, Herr Professor begins to sound suited to the task (by doing nothing and making noise about it).
Fed Opposes Auto Aid Without Congressional Action [Bloomberg]