Jack Baruth takes a look at GM's relationship with the United States government.
When prospective Secretary Of Defense Charles Erwin Wilson told a Congressional confirmation hearing "...for years I thought what was good for our country was good for General Motors, and vice versa," he coined a very famous phrase - but he was forced to sell his stock in order to get the job.
Although the auto industry and government of the United States have been slow-dancing since well before World War II, they were always expected to keep a high-school prom's worth of distance for decency's sake.
No longer. Former Governor of Michigan Jennifer Granholm's speech last week at the Democratic National Convention stated that President Barack Obama "jump-started our engine" and "revved us up." In this case, "us" referred to the auto industry and the "one million jobs" that she claims were saved in the Obama-approved Detroit bailout. Now, GM has decided to release its third-quarter results rather early - just before Election Day, as a matter of fact. It doesn't take a conspiracy theorist to see one hand vigorously washing the other here. The question becomes: is it wrong for those hands to be in contact?
Very few automotive enthusiasts are naïve enough to think that government and industry don't walk hand in hand all around the globe. The original Volkswagen was effectively funded by that one German government about which nobody likes to talk. Hyundai openly lobbied the South Korean lawmakers for money to catch up with Toyota's hybrid system. According to Jim Press, the former Chief Operating Officer of Toyota's American import arm, that very system was developed using hush-hush funds from the Japanese government. (Press later walked those remarks back, under some considerable pressure.) Let's not forget the so-called "Ryder Report" that encouraged the UK's government to take control of British Leyland, leading to the complete and utter collapse of what was once the second-greatest national auto industry in the world.
In all of those cases, however, it was acknowledged that the national interest of South Korea, or Germany, or the United Kingdom was closely tied-in with the health of its auto industry. Libertarians find that idea repugnant, but for better or worse, most people in the Western world aren't Libertarians. Most people can get behind the idea of a government salvaging a national auto-industry disaster, or even lending a helping hand to assist the country's balance of trade. Some cynics may point out that such a policy rarely leads to great success, and it never leads to great cars, but let's not be picky, okay?
The Granholm speech, and the GM decision, point to something more pernicious: the idea that the auto industry of the U.S. is allied with a particular party. In this case, obviously, it's the Democratic party. While the Democrats aren't the party of Big Business, one of the less-remarked-upon effects of the GM bailout was to give the UAW a major seat at the decision-making table. A cynic might suggest that the Ford family controls Ford, the Italians control Chrysler, and the UAW, together with the Democratic party, controls General Motors. That sounds like battle lines being drawn, doesn't it?
The prospect of the nation's largest automaker owing its existence to the Democrats, or acting in such a manner as to help the Democratic Party obtain an advantage in the next election, should elicit disgust in every right-thinking American no matter whom they support in that election. GM is too big, too wealthy (even post-bailout), and too powerful to become the exclusive property of any political body. It unbalances the system, which isn't good for America.
Nor is excessive political affiliation good for GM. Approximately half of the country doesn't want to see the Democrats triumph this November. It's not good business to throw away half of your customer base with a few ill-founded decisions. Those people will end up choosing competitive products even if GM's cars are the right cars for them. It's bad for everyone, no matter how you look at it.
What can, and should, GM do? To begin with, the company should move its quarterly reporting to a date after the election as a forthright statement that it does not wish to support either candidate. An explicit statement to that effect should then be made as often as it takes for everyone to get the point. It's the right thing to do. It's also respectful of the American people, who collectively own a large percentage of General Motors at the moment. This company belongs to all of us - and it should act that way. That's what would be good for GM, and good for the country as well.