The New Government Run Auto
Wagoner’s out at GM, essentially pushed out by the Obama administration without consult from the rest of the policy makers in Washington (i.e. Congress) as a condition of new government loans.
This serves as nothing more than strengthened evidence of how screwed up our government really is. At no point in history has a CEO ever been forced to leave through direct consult of the President of the United States. A company board of directors reigns supreme over the function of the company, and last I checked no one from the Obama administration sits on the GM board of directors.
This is not how capitalism works. This is not how free markets work. This is not how a publicly traded company works.
If the Obama administration wanted authoritative power over who holds what position in a company, they should have bought stock and run the CEO and the board of directors straight out of Detroit. Instead, the government gave the company a loan, which at last check, does not come with any voting rights.
To be sure, Wagoner needed to leave. His leadership was and has been ineffective for the last 5 years with no forward thinking and a complete lack of influence from the corner office. But to be run out of town by the Government is preposterous.
The punchline to all this came from the joker himself: “The government does not wish to run an auto company.”
Furthermore, if bankruptcy is an option, as Mr. Obama now states, then why did all that taxpayer money get dumped into the company in the first place?
The next joke will come at the conclusion of the bankruptcy hearings; as repayment of taxpayer money will be forgiven as debt is erased and creditors are shooed away. All in the name of a stronger and healthier General Motors.
Meanwhile, Ford hasn’t taken a dime.
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Amen Amen Amen!
In my opinion the administration looks foolish kicking out the leader, yet claims they don’t want to run the company themselves either.
I agree with you Grant that Wagoner had to go, but looking back on how things went down, he’s the real winner here and probably glad to be “forced” out. laura
You have got to love how Obama says “The government does not wish to run an auto company.” and follows up how we cannot and will not let the company fail? Did you hear what Obama said about refinancing applications jumped 30 percent last week, doubling the rate of last fall, which would save “the average homeowner hundreds of dollars a month — the equivalent of a generous tax cut.” – GENEROUS TAX CUT? You have got to be kidding me!!! He is out of his gourd
Wagoner has done an admiral job of basically keeping it all together. The problem with GM was that it needs to get smaller, maybe a new person can figure it out and make a much more coherent company.
Heard from a friend who works with GM, that Bob Lutz is going to leave GM later this year as well. He is THE car guy in GM and I am afraid that they don’t have someone to replace him as dynamic as he is. GM may not exist by the end of this year. Real smooth that the government doesn’t have a single car guy in there Automotive Destruction Group or whatever they are calling themselves.
I know people don’t like giving handouts to banks, but these automotive companies make something, employ real people, and utilize real materials. That should count for something.