Obama and GM
May 6th, 2011
Republicans attacked Obama for the GM bailout, claiming that when the government intervened, it was a “major power grab” that effectively put GM under the control of the federal government–and, in the eyes of many right-wingers, under Obama’s personal command.
Well, in early 2009, the company was near collapse, threatening to destroy the American auto industry and put huge numbers of Americans out of work. Today, as a result of the intervention, the company is not only back on its feet, but posted a $3.2 billion profit. It’s not perfect, but without doubt far and away much better than it was before Obama came in.
So, will Republicans–who claimed Obama owned the industry–give him credit for its success?
Saving GM also saved Ford, oddly enough:
http://finance.yahoo.com/q/bc?s=F
Actually, not so odd when you remember the Feds also guaranteed payment to parts suppliers in 2009 during the height of the crisis.
I’m really all out of snark on this, the right is just such a 24/7 cavalcade of stupidity that it gets tiring combatting it.
I really do think they are this stupid intentionally. The only thing they have left is lying to the American people, which of course Lincoln had something to say about.
Obama, the Government, got a little bit lucky: GM’s current product is the best it has ever had out, across the board, since the 1970s, perhaps the 1960s. Probably the best ever. The equinox gets better gas mileage than many compacts yet has 40 inches of rear seat leg room. If GM had built cars like that it would never have gotten into trouble in the first place.
Bankruptcy got rid of some of the bad contracts inherited from the 1960s. GM’s labor cost is below most of it’s rivals.
There are problems, of course: The Chevrolet Cruse was introduced four years ago to compete against the last generation Hyundai Elantra in Korea – and didn’t do a very good job at that in Korea (only some minor market share improvement of say 1% or so). Now it’s having to compete with the next generation Elantra and it seems the only car that can hang with that is the new Ford Focus.
Also, the Chevrolet Malibu’s platform was designed at Adam Opel in Europe. GM under Obama attempted to SELL Opel which was like committing suicide for the company. Fortunately Ed Whitacre put a belated cobash on that sale to Russian/Canadian interest.
There’s little evidence that Americans in any of the big three can design world class competitive cars. They can design a truck, but to design a car they rely on overseas: GM on Opel (medium) and Daewoo (small) and increasinlgy GM China. Ford on Ford Europe (Fiesta, Focus) or Mazda (Fusion).
Chrysler is managed by Fiat. That’s not all bad. Fiat is the best managed car company in the world over the last decade.
Oh, don’t get me wrong–I’m not claiming that Obama actually engineered the details of the comeback. But he did keep it from being destroyed, which gave it that chance. Had this happened under Bush or McCain, the outcome probably would have been significantly different.