When Chrysler could have sold for $1

    In the end, the argument to save Chrysler was based more on political and social reality. Saving the automaker would prevent the loss of those 300,000 jobs and President Obama being blamed. Ripple effects might include Michigan's state unemployment fund going broke.

    White House Chief Economic Adviser Larry Summers said it was better to invest $6 billion in Chrysler's survival than pay several billion for its funeral. He and others praised a Fiat merger, in part because it would preserve the future opportunity to merge with GM.

    Summers pressed the task force members to apply probabilities to their projections. He asked for a show of hands: If you assume the probability of saving Chrysler for five years is 50%, would you save it? The task force members voted four to three against it. Rattner couldn't make up his mind but eventually voted in favor of a bailout. Summers had the tie-breaker and said yes as well.

    A memo with the arguments for both sides was prepared for Obama. An entire session of the morning daily briefing on March 26 was set aside to discuss it. After 20 minutes, the president decided the decision was too important to rush and delayed it until evening.

    Meeting in the Roosevelt Room of the White House, Obama heard arguments for 45 minutes. Polling data was discussed showing public opposition to the bailout, as was the impact of Chrysler's failure on unemployment. At the end of the meeting, Obama asked "Does anyone else have anything to say?" And then he decided. "I'm prepared to give Chrysler 30 days to see if we can get the Fiat deal done on terms that make sense to us."

    Chrysler went through bankruptcy so its debts could be eased and it could continue in business. And negotiations with Fiat turned out to be tougher than expected -- due in part to Marchionne's explosive temper --- but it finally went through and the automaker was saved. But for a long time, its survival hung by the narrowest of threads.