Thus begins the long journey toward statism in American industry. An Administration headed by a President who never held a real job in the private sector takes on the task of reinventing General Motors, starting with the forced resignation of GM’s CEO, Rick Wagoner.
This Administration needs some CEOs to do the perp-walk in acknowledgement of the failure of capitalism and as a testament of the wisdom of state overseers who ride to the rescue, cash in hand. Bankruptcy, surely, would have been cleaner and more honorable than this.
Wagoner can certainly be drawn as the poster boy of an industry’s failure to adapt more quickly to foreign competition and to the spike in oil prices that pushed gasoline to $4 a gallon. Yes, it had too many brands, too many dealers, too much production capacity, and too-high labor costs. But Wagoner is not the problem and it’s unlikely that there’s anybody better out there to run GM. Certainly there’s no reason to think an Administration composed of people who’ve never punched a time clock — or for the most part worked with those who do — is any smarter or more equipped to determine how to fix it.
Government has no expertise here and, therefore, no business. The Administration can yell out commands, humiliate CEOs, and turn the auto industry into the industrial version of Fannie Mae and Freddie Mac — a plaything for politicians determine to move their social agendas outside the federal budget — but it has no expertise. It’s academics running factories; the reverse would be shop stewards running universities. It’ll be change. There’s no reason, however, to think it will be change for the better.
This is a sad day for corporate America and a step, I fear, that the nation will be a lifetime reversing. A clean bankruptcy would have been better for GM and for the nation.