This is what happens when you put Chicago crony pork-stuffed politicians in charge of government bureaucracies overseeing businesses they know nothing about — and, per commenter Steve Egg, that are direct competitors to businesses the government owns.
Via the WSJ, Transportation Secretary Ray LaHood, whose specialty is earmarks, not engineering, walked back his scare-mongering this morning about Toyota’s pedal problems — but not before his loose lips sank Toyota’s stock:
Toyota Motor Corp. (TM) pared earlier declines after U.S. Transportation Secretary Ray LaHood said he had misspoke when he had advised in congressional testimony that people stop driving cars involved in Toyota’s recall, advice that had initially caused a steep drop in Toyota’s shares.
Testifying before the House Appropriations committee, where he was scheduled to talk about the fiscal 2011 budget, LaHood was asked what advice he would give to owners of Toyotas subject to the recall.
“My advice is, if anybody owns one of these vehicles, stop driving it, take it to the Toyota dealer because they believe they have the fix for it,” LaHood said.
Afterwards he told reporters that wasn’t what he meant to say.
“What I said in there was obviously a misstatement,” LaHood said outside of the hearing room. “My advice is if you have one of these vehicles, if you are in doubt, take it to the dealership today.”
…Shares had sped up their declines after LaHood’s comments, falling as low as $71.90 Wednesday. They have now pared those loses since the clarification and were most recently down 5.5% to $73.87. The shares had been hovering closer to $75 since the opening bell, compared to the $78.18 Tuesday close, but started falling about 10:30 a.m. EST.
Perhaps LaHood should stick to what he knows: Swimming in his taxpayer-funded slush funds.
Mr. LaHood’s comments Wednesday were the latest in an aggressive campaign by his department over the Toyota situation. Last week, Mr. LaHood took credit for the company’s decision to stop building and selling eight models involved in a recall over accelerator pedals that could potentially stick, saying Toyota did not take the step until urged to do so by the department.
Some safety advocates said, however, that Mr. LaHood might be trying to protect federal safety regulators from potential liability issues over their role in investigating defects.