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Monday, June 01, 2009

Outrage of the Day: Political Decisionmaking at Government Motors

From "Lawmakers Seek to Influence Plant Locations" by Neil King, Jr. and Kate Linebaugh for the June 2 Wall Street Journal:
The Obama administration has said repeatedly that it won't use its majority stake in General Motors Corp. to meddle in the company's daily affairs. Lawmakers on Capitol Hill aren't being so shy.

The areas of potential concern to lawmakers range from proposed plant and dealership closings to longer-term plans for more fuel-efficient cars. And key elected officials are already promising to weigh in even as President Barack Obama and his aides say they will shield GM from outside pressure.

"I think members will express themselves for sure. We should do that," said Rep. Sandy Levin, a Michigan Democrat whose district lies just north of Detroit. "We should express the interests of our constituents."

...Lawmakers have already shown they have muscle with GM, and they aren't likely to back off now. Members of the Michigan delegation rebelled last month when word got out that GM, post-bankruptcy, planned to boost its imports of cars made at GM factories in China. As a result, GM agreed as part of its talks with the United Auto Workers union to reopen two idled plants by 2011 to manufacture as many as 160,000 compact cars a year.

Rep. Gary Peters, a Michigan Democrat whose district north of Detroit includes three plants set to cease production, is one of many lawmakers in the region who want the refitted plants in their backyard.

He has backing from Democratic Michigan Gov. Jennifer Granholm, who said Monday that she is going to be "aggressive" about trying to snare a facility that will help keep some automotive jobs in the state, which has the highest unemployment rate in the country.

Ms. Granholm, besides countless television appearances pleading for aid, has made about a dozen trips to Washington to meet with Mr. Obama, the president's automotive task force and dozens of other officials...

"I think where GM builds its next plant is going to be more of a political decision than a business decision," said Rep. Pete Hoekstra, a Republican from western Michigan. "For the foreseeable future, these car companies will be run by the Obama administration, and it will not be arm's length."...
Lawmakers care about their own prominence and re-electability, not profitability. They are not going to run General Motors successfully. Mostly (as is obvious from the priorities stated by the Congressmen in the article above, and by such things as the adoption of legislation forcing automakers to meet unrealistic and anti-family mileage standards), they aren't even going to try.

General Motors didn't stay competitive. Even hundreds of billions of U.S. taxpayer dollars won't change that fact.

If the U.S. government actually wanted to help the domestic car business, Congress and the Administration would repeal mileage standards (which kill Americans as well as car companies), stop pro-union public policies and get the government out of car company management and ownership immediately.

The government isn't doing any of those things.



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Posted by Amy Ridenour at 11:00 PM

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