Don’t miss George Will’s column, “Have We Got a Deal For You”. The article touches on the fact that the sickly “Government Motors” will now have an unfair advantage over a healthy Ford.
One other point to consider is that Ford’s very employees — members of the UAW — are now owner-partners with the government of another car company: GM. What a damn mess.
GM is adopting new ways to lose money: Responsive to its UAW masters, GM is moving from China to America the production of some components of one Chevrolet model. Says UAW President Ron Gettelfinger, “It should be built here if it’s going to be sold here.” That principle, now successfully asserted, means economic autarky — the end of international trade, and of prosperity.
The government’s $50 billion — so far — acquisition of the shadow of GM will injure, with unfair financial advantages, the surprisingly healthy U.S. auto company, Ford. Of course, the government does not intend that injury, any more than it intended to cause protests in Mexico over the high price of corn tortillas, a result of Washington’s mandate that Americans burn corn (ethanol) in their cars.
Washington’s “rescue” of GM began because GM is “too big to fail,” and bankruptcy is (well, was) “unthinkable.” Big? GM’s market capitalization, $375.8 million on Wednesday, is about the size of California Pizza Kitchen’s ($340 million) — is it too big to fail? — and one-eleventh that of Harley-Davidson ($4.3 billion). Fail? If GM has not already failed, New Coke was a success.
The administration is determined to prop up GM as a jobs program for the UAW and Midwestern states rich in electoral votes. This frenzy will intensify as the administration’s decisions deepen the debacle.