The American Spectator

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GM: Generally Mismanaged

12.10.08 @ 6:01AM

RICKETY AT GM
Re: Eric Peters's Should Rick Resign?

Yes, he should. The Board of directors should have done it long ago. The fact that they didn't can only be explained by their complicity in the state GM is in.

GM ran Detroit Diesel into the ground. Roger Penske gets majority ownership and with the same union, engineers, plants, etc. prints money with it. The only difference was management.

Wagoner wasted $2 billion buying a piece of Fiat with a clause allowing Fiat to put the rest of the company to GM for another $10 billion or so. When the day of reckoning approached GM realized they made a colossal mistake. So they spent another $2 billion to buy their way out. Wagoner's comment (I couldn't make this up) was: "sometimes you do the deal you can, not the one you want." Huh? If it isn't the one you want, you shouldn't do it. I'm sure they teach that at Harvard B-School.

He never articulated to the rank and file the deleterious implications of all of the labor contracts.

He said until recently that GM had enough cash to last through the end of 2009. Now they are broke, a year early. After GM renegotiated the union contracts last year, they took a $38 billion writedown in deferred tax assets. Does anyone believe that revaluation was due to activities that took place in the 3rd quarter of 2007? GM had been deluding themselves of the financial straits they were in. Maybe if they had been honest then the union would have started working with them when it was still possible to save them.

Wagoner is known as a numbers guy, not a car guy. He has failed miserably on the numbers side. He should go.
--James M. Mulcahy
P.S. I drive a 2007 Suburban.

I have a modest proposal. Let each reader of this magazine send a letter to Barney Frank (D-Mass.) and Christopher Dodd (D-Conn.) and request the details on the dispersal of the $350 billion that has been given out from the TARP.

Since Congress is so insistent on the (admittedly less than adequately performing) auto exec's taking full responsibility for the money they may be given, including perhaps multiple requests for resignations, the level of detail in the possession of these two stalwarts ought to be incredible. I expect we will get copies of checks written to Joe Six-pack for $16,000 for a car loan from Citibank.

Or do you think they may have no idea what happened to the money?
-- Jay Molyneaux
North Carolina

BIG AND BEAUTIFUL
Re: G. Tracy Mehan, III's Steadying the Ranks:

The winning principle for conservatives in today's new-New-Deal environment is quite simple: big government action must always be aimed toward empowering individuals, not bigger government. It sounds contradictory but it's not.

Example: Assume an auto bail-out is inevitable, and that it's politically untenable to argue it should not be done. Fine -- argue that it should at least be done in a free-market capitalistic way: send each tax-payer a voucher redeemable upon buying a car. Or you want the government to invest in car companies? Fine: issue stock -- literally, issue stock -- to each tax-payer as a share of what was lent. 

How lovely it would be to see poor people on Chicago's south side holding up the first stock certificates they've ever owned, complements of conservatives. Force the Obama socialists to unmask and argue that big government -- not the people themselves -- must own the car companies. Let the disempowered get the tickle of the idea that they can become empowered and more affluent, if we can get the big-government socialists out of the way. Let them understand how the Obama socialists want to keep them and everybody else on the big-government plantation. Now that's a plan for inroads in Democrat constituencies.

But the Stupid Party will have to learn how to do political theater. They need to be prepared, starting with their hapless leader, to make demands and filibuster, instead of just stupidly "trying to get something done."
-- Eric
Grand Rapids, Michigan 

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