Larry Summers, the White House’s chief economic adviser, spoke out earlier this week in support of General Motors and Chrysler closing hundreds of dealers across the country. Summers warned that efforts to keep the dealers open could be detrimental to the automakers and put the repayment of the tax payers’ $70 billion in financial aid in jeopardy.
A House bill is currently gaining support that calls for GM to reverse its decision to close more than 1,100 U.S. dealers. The bill also contains a clause that would force Chrysler to reopen its 789 shuttered dealerships.
“We believe that restructuring, along the lines of the restructuring plans that the companies committed to and we agreed to provide financing for, is crucial,” Summers told The Detroit News. “We’ve been very clear that companies needed to be run commercially, rather than politically.”
Summers added that government control was not the best solution for Chrysler or GM, saying the “best protection for the taxpayers’ investment is to ensure that the companies are managed commercially.†In all, U.S. tax payers have spent more than $70 billion on Chrysler, GM and their respective financial arms.
