Sold Down the River
An op-ed contributor in one of today’s major newspapers began his article by stating that President Obama’s stunning decision to demand that Rick Wagoner resign as chairman and chief executive of general Motors was based on the wrong set of premises. The president cited a “failure of leadership” as a reason for forcing out Mr. Wagoner, indicating he did not believe G.M. had moved fast enough in facing up to global competition.
After taking a closer look at Mr. Wagoner’s performance over the past few months we’ve come to believe that President Obama is being misled by a number of people in his brain trust. Either that, or the administration, in its frustrated efforts to slow down the nation’s sinking economy, felt that the time had come to provide America with a scapegoat. Mr. Wagoner was the perfect fit, and his dismissal was staged to take Mr. Obama’s administration off the hot seat. At least for now.
A “failure of leadership”? Hardly. Under Mr. Wagoner, G.M.:
• Is undoing decades of management acquiescence to the United Auto Workers;
• Is coming close to achieving the cost structure of Toyota’s assembly plant in Kentucky;
• Has stripped thousands of dollars out of the cost of every vehicle;
• Has seen the Cadillac CTS and Chevrolet Malibu win 2008 car-of-the-year awards;
• And has seen the new Camaro become the high-water mark of revitalized American design.
We’ve heard self-proclaimed experts say that the whole restructuring effort at G.M. has failed. These experts have been saying that costs are not the real problem. The real problem is the product. The cars are not good enough, they say. Baloney. Earlier this month, in the latest J. D. Power ranking of dependability, – an announcement that the “brain trust” surely missed – Buick tied with Jaguar for first place, coming in ahead of perennial front-runner Lexus.
Also ignored is Mr. Wagoner’s strong hand in the development of the lithium-iron battery that will power the Chevrolet Volt extended-range electric car, thereby providing this country with the best opportunity to win a piece of a huge new “green” industry now dominated by foreign companies.
It may have been politically expedient for Mr. Obama to give Mr. Wagoner the pink slip, but politics in Washington have real world consequences. Before he goes too far, Mr. Obama should recognize that unlike the insurance giant A.I.G., or Wall Street’s failed banks, General Motors consists of real factories where real people make real things, and if these auto workers are disenfranchised and added to the unemployed, what will the voters think about his promises to create another 3.5 million jobs?
Those promises were just rhetoric. This depression was known to be inevitable even at the very beginning of Mr. Obama’s presidential run. Neither he nor anyone else in authority knew how to prevent the collapse back then, and they still don’t know how to deal with it. They’re “studying the ‘Great Depression’”, we keep hearing them say, but we’ve yet to hear anyone mention our World War II shipbuilding miracles. They’d damn soon better get to that chapter though, because we’re running out of time and we could be seeing some “real world consequences” sooner than they think.