GM/Chrysler And Detroit Bias

crossposted at

Wednesday “Dr. Ed Montgomery, the White House Director of Recovery for Auto Communities and Workers, will visit Michigan to discuss the President’s support of a strong American auto industry and the President’s Auto Task Force initiative to support and revitalize auto industry workers and communities.” – Office of the Press Secretary, the White House

There is no laughing in Michigan this April Fools, no jokes, and no elbow-to-the-rib chuckle.

Instead the new Car Czar will head to the heart of the problem and begin his task. But where’s the Bank Czar? Hmmmm.

President Obama is giving General Motors 60 days to come up with a more aggressive plan to cut costs and debt. Chrysler is only getting half that time to work out a combination with Italian automaker Fiat. If they fail, the government will force them into bankruptcy court. –

According to the same article, “Bankruptcy would not be the end of the drain on federal dollars. In fact, it could mean an even greater cost to taxpayers.

There is widespread agreement that the companies would need more financing to fund their operations during a bankruptcy than the $21.6 billion they are asking for from the government to stay out of bankruptcy court. GM has estimated that it would need $45 billion in additional federal help for even a quick trip in and out of bankruptcy.”

The President’s plan also came with the ousting of GM CEO Rick Wagoner.

Firedoglake’s Jane Hamsher takes on the GM/Chrysler question on MSNBC, and exposes the real Detroit bias.

Michigan Gov. Jennifer Granholm is clearly wondering herself-

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The word on the street is a good CEO kick in the pants is just what Americans may need to get behind the plan to save the Auto Industry. After all we hate all things that seem irresponsible, right?

For example, a recent story on “free cars and gas” for GM employees. Of course those in the trenches know better.

Sarah A. Webster at the Detroit Free Press writes,

“Sometimes what looks like a perk is just not a perk. Every corporate jet does not represent excess.

Nor does every “free” car from Detroit’s automakers.

Lots of companies provide discounts on their core product as part of their compensation for workers.

The newspaper where I work gives me “free” newspapers at work. Employees of airlines, I’m told, also get “free” flights. Toyota Motor Corp. told me that it also provides free car insurance for employees who lease one of their vehicles, at discount.

And sometimes, well, things that look like perks are just something else altogether — like a test program.”

It’s the Detroit Bias. People love to hate Detroit and seem to go out of their way to find fault.

And once they get past the Detroit bias, there is the large divide between progressives and conservatives to tackle. Where one side yells Bailout! While the other yells LOAN! Where one side favors helping, while the other prefers a market correction via survival of the fittest.

The mere mention of government involvement in business sends a ripple through many already paranoid conservatives and independents. The ones that prefer doing nothing while jobs, homes, and lives are ruined.

Many of us see this as priority on their part. It’s more important to save their dogma than real people.

Never mind that GM and Chrysler came begging the government and agreed to terms. Never mind there needs to be accountability for those terms. Never mind these same people were calling for CEO heads to roll months ago. Never mind we don’t actually function in a true free market and therefor our solutions can’t be simply free market solutions…

No, they are stuck on the idea that our government can only function in one way, and any move off that path will send us right into some Marxist/Socialist/Communist hell.

Former GOP presidential candidate Mitt Romney is a bit more understanding of the Administration’s decisions

So where does that leave Detroit? And the great state of Michigan?

With a President making an example of an easy-target CEO. A public beheading in the square to satisfy the chanting mob. The buying of more time for all parties involved.

With a large swath of voters angry the government is even THERE, demanding cities and counties and a state die a slow death while we all watch. Because it’s the American way.

With two real options: continued government help or bankruptcy, which we now know will cost more than the help.

And, without argument from anyone, a huge mess.

Contributing Editor Erin Kotecki Vest also blogs at QueenofSpainblog


  1. And the huge mess started because of the terrible cars Detroit made. If it weren’t for the Japanese, we would probably still be driving awful cars. It was only the competition that made Detroit even try again.

    I grew up driving ONLY American cars, but when it came time for me to spend my own hard-earned dollars, I bought Japanese cars and never even bothered to look at American cars – and most people I know who are my age or younger (who aren’t from Detroit) feel the same way.

    I know American cars have gotten better. But trust lost is hard to gain again.

  2. Eastern Canada is suffering with the American Auto crisis too….and while it is practically unthinkable to see HUGE companies like these going under and devastating so many people with have to wonder how these companies have kept going along when the writing was on the wall for soooo long.

    Temp layoffs, plant closures, etc for the last what . 20 odd years?
    And nothing.

    And people kept enjoying jobs that required no skills, no education and paid well….and now these people are totally unemployable in other sectors without retraining.

    That also requires personal responsibility too.

    I have NO clue how you fix it though…..

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