In one of his final acts as president, George W. Bush decided to prevent the U.S. auto industry from falling into a deep hole, one out of which it probably would not emerge.

Under the plan, General Motors Corp. (NYSE: GM), Ford Motor Co. (NYSE: F) and Chrysler L.L.C. will receive $17.4 billon in short-term loans from the bailout money approved for Wall Street. The U.S. Congress failed to pass a rescue package for Detroit last week because some Republicans believed that the companies should be forced into bankruptcy.

That option was unacceptable to a free market conservative like Bush. "Chapter 11 is unlikely to work for American automakers at this time," Bush said in a televised press conference. A bankruptcy could "send the economy into a deeper and longer recession."

Bankruptcy is still on the table. The $17.4 billion lifeline will gas up the former Big 3 until March. Then the companies need to present a plan to the government on how they can become viable. Both the UAW and suppliers will continue to feel the pain. Odds are fairly good that Detroit will come back to the next Congress for even more money in the coming months.

All of the money in the world will not help Detroit if the Big 3 don't produce cars people like.

Cerberus Capital has made a huge mistake in hiring disgraced former Home Depot Inc. (NYSE: HD) CEO Robert Nardelli to run Chrysler LLC. which it officially acquired Friday for $7.3 billion.

For one thing, he has no experience in the auto industry. Moreover, he was a horrible CEO at Home Depot, whose arrogance was matched by a lack of operational skills. The Atlanta-based retailer is in the process of selling off its HD Supply Division, which Nardelli built, to a private equity group lead by Bain Capital for $10.3 billion. Home Depot also lost market share to Lowes Cos. (NYSE: LOW) and saw its stock price fall about 8% under Nardelli's leadership.

The reasons and justifications for the appointment make no sense. The New York Times reported that Nardelli was hired for his "turnaround expertise" and won't be paid if the automaker "does not improve." I'm not quite sure what that means.

Nardelli was highly regarded when he worked for General Electric Co. (NYSE: GE) and was one of the candidates to succeed Jack Welch when he retired. That reputation got him the job at Home Depot, where he earned an outrageous compensation package and the ire of shareholders. Maybe Cerberus thinks that Nardelli can bring the GE touch to Chrysler.

Unlike Home Depot, the workforce at Chrysler is unionized. Nardelli better keep his considerable ego in check during the current round of contract negotiations, otherwise he's going to have huge problems. Though considerably weakened, the UAW will probably be as ornery to deal with as any Wall Street investor.

Nardelli has got an incentive to keep his ego in check. If he can turn Chrysler around, he may get an ownership stake in the company that will make him far wealthier than he is today. Of course, he'll still be plenty rich if he fails too.

That's one of the perks of being a failed CEO.