One of the big stories this weekend was that the chairman and CEO of General Motors is resigning his position. What is even bigger news is that he is doing so at the behest of the Obama administration. What is even bigger news than that is that General Motors says the Obama administration is working to “restructure” the auto industry. You read that correctly. The government is going to restructure an entire industry. This does indeed signal a “tectonic” change in the way that business relates to government (see Politico.com story).
Here’s how the New York Times is reporting it:
“The White House on Sunday pushed out the chairman of General Motors and instructed Chrysler to form a partnership with the Italian automaker Fiat within 30 days as conditions for receiving another much-needed round of government aid.
“The decision to ask G.M.’s chairman and chief executive, Rick Wagoner, to resign caught Detroit and Washington by surprise, and it underscored the Obama administration’s determination to keep a tight rein on the companies it is bailing out â€” a level of government involvement in business perhaps not seen since the Great Depression.”
The times, they are a-changing. That’s for sure.
This reminds me of a verse:
“Do not say, ‘Why were the old days better than these days?’ for it is not wise to ask that.” (EccÂ 7:10)
It’s all the same according to Qohelet.
i am a little sick…not really surprised though…restructuring the car business-big government at its best!
They’re being held responsible for the credit extended by the last administration. How is that a bad thing? As the article points out, they’ve focused on SUVs and trucks at a time when neither option is particularly prudent given current economic and environmental concerns.
“they’ve focused on SUVs and trucks”
I’m guessing GM produced what they thought the people wanted to buy.
Was that bad of them?
Kruse Kronicle insight is telling:
“Autonomous individualism is a product of the Enlightenment. But so is the notion that a national government entity can correctly comprehend massive complexity, act with greater wisdom toward the common good than what emerges from people freely engaging one another, and that it can do so with greater moral rectitude than would otherwise be the case.”
So companies that take taxpayer money should not be accountable to those who represent the taxpayer?
They shouldn’t be given taxpayer money… but since that ship has sailed… the government shouldn’t just control them.
GM needs to be restructured, if by restructured you mean dismantled and its pieces parceled out to whoever will take one.
Scott, if GM ( or anybody else) takes our money (not government money Scott; the government only has our money) they can expect to be told what to do.
But if you think Barney Frank, Pelosi, Chris Dodd and Mr. Obama can run GM more efficiently than it’s current owners then I don’t think you’ve paid much attention to the history of governments.
The Congress will demand (because of contributions to their re-election campaign by certain individuals) that GM should make a new car; we’ll call it the Yugo Monte Carlo. They’ll also demand that it’s the car ALL Americans need to buy. It will be green; helping to save the planet – primarily because it rarely runs.
Many of us who pay attention to the history of failed cars won’t buy the Yugo and will choose to return to the ox and cart age because anything is better than a Yugo. GM will then officially die.
Yeah, let’s have the “gov” run GM.
Why would the govt. be running a private business?
Americans are seeing us lose our freedoms….it’s happening right in front of our faces. And yet, some are applauding it.
This is so concerning. Govt. getting involved in places that they have no business being…pun intended.
We’re seeing socialism move into American life a very fast pace at this time. God help us.
Hey, what happened to my comment?
Well, I guess all my great, wonderful, fantastic, enlightening comments got lost in cyber space! 🙂
But, here’s the shortened version of what I said. What did we expect from a President, who attended a liberation, racist Church for years and years? He is socialistic to the core, and he is liberal to the core. And, the sad thing is…that people knew this about Obama, and yet, for economic reasons…they elected him.
America is experiencing a huge shift in philosophy and policy right now. We’re becoming socialistic with Big Brother gaining strength.
God help us.
Ok….that comment also evaporated. Denny, are my comments being held in moderation for some reason?
Or, is Obama’s men in black suits and black sunglasses controlling the internet now?????
So we should expect the very people who made the mess to clean it up? I’m not arguing that the Obama administration can run the company more effectively. I simply see no problem in holding the leaders accountable when they take our money (I never said it wasn’t our money – you’re rushing to paint a caricature).
Further, I see nothing wrong with calling for the industry to be more progressive in implementing environmentally sound measures and technology. Why is that a bad thing? And please, let’s stop with the over the top socialists “apocalyptic” rhetoric.
That wouldn’t be Obama, it would be Gore controlling* it, right ;-).
* – yes, I know the story about this.
“â€œtheyâ€™ve focused on SUVs and trucksâ€
Iâ€™m guessing GM produced what they thought the people wanted to buy.
Was that bad of them?”
In a way, yes. You can make a (very weak) case for saying that the minivan is an absolute necessity for today’s working family. Fair enough. But where was the push from AMERICAN companies towards sulfur free diesel engines in those minivans? Where was the push for hydrogen based hybrids (don’t say that they can’t be done, Honda and BMW already have them ready for production)?
Better yet, where was the push for a return to the full size station wagon with a full on ad campaign when gas hit $2 a gallon instead of shrugging and whimpering when it hit $4?
I’ll tell you what, I have an SUV at this point because I need the space, and there are precious few options for that full sized station wagon. And I tried buying American with a TrailBlazer, and I ended up selling it back to the dealer six months later after two transmissions, two sets of wheel bearings, an electrical system, a fuel pump, a water pump and a broken 60/40 split latch. So, I bought a Mazda, and will probably never buy anything else, unless Chrysler or GM start offering something along the lines of a lifetime bumper to bumper warranty.
There should be no more “bailout”, re-organization through the courts(not Obama) is the way this should be handled to preserve what is left of our “FREE” markets in the U.S.
It is horrifying to realize the excutive branch of our government has forced out a CEO of a private company. The slippery slope of Socialism is full steam ahead guys.
A commenter “Melvee” wrote this on another blog.
I’m increasingly troubled by the unwillingness of everyone — newscasters, commentators, and especially politicians — to use clear language about what’s going on here.
Obama says “my administration” and the “U.S. Government” will stand by GM by continuing to “lend” money to the company and by guaranteeing GM’s warranties on its new cars. Newscasters talk about the “government” lending money and guaranteeing loans in the repurchase of toxic assets from banks.
Let’s be real, here. Neither “the government” nor the Obama administration has any resources. The U. S. taxpayers are handing out the money, guaranteeing loans, and now apparently guaranteeing GM’s warranties. Perhaps if every report or commentary talking about any facet of the recovery effort made it clear that every dime involved belongs to the taxpayers or is being borrowed by them, we might all be taking a more clear-eyed view of what’s going on.
I don’t think anyone (despite what you continue to insinuate), believes that the money isn’t tax money. Where are you going with this?
Sorry, Volfan. Your comments were among some that inexplicably ended up in my spam folder. I have just set them free.