G.M. = Government Motors

(update) In the wake of last evening's report that General Motors Corp. Chairman and CEO Rick Wagoner will step down immediately at "the request of the White House," Wall Street took a big step down as well. The Dow Jones Industrial Average dropped 254.16 points, or 3.3%, to 7522.02, showing declines everywhere. GM shares shed 25%. Strategist Bill King, of M. Ramsey King Securities in Burr Ridge, Ill., said today on online.wsj.com, that investors are skeptical that the government can engineer a turnaround for the car makers.

"These guys have no experience running factories and getting their fingernails dirty," said Mr. King. "But at the same time, you have them running bigger and bigger chunks of the economy."

How true. It's doubtful that there's enough business knowledge in this administration to run a lemonade stand, let alone a car company. So, you have to ask yourself... Why does the administration apparently want GM to fail? First off, with regard to Wagoner being shown the door, isn't it the the Board Of Directors of GM that's supposed to make that decision? Why is "The White House" (a.k.a. President Obama and the ObamaNation) deciding who will run General Motors?

Isn't it obvious? The Gummint is going into the car business. According to the Wall Street Journal, "In addition to pushing out Mr. Wagoner, the (Government) task force is in the process of replacing the majority of its directors. Kent Kresa, a longtime director, will serve as interim chairman. Mr. Wagoner will be replaced as CEO by Chief Operating Officer Frederick "Fritz" Henderson."

In my opinion (which is widely shared among auto enthusiasts), Wagoner's team did more to put GM back on the fast track than any of his recent predecessors, Government intervention at this point will do nothing more than totally derail his efforts and produce a fleet of crappy little "Mr. Bean Mobiles." And that is just what this administration wants—everyone driving identical little crap boxes that do nothing but get you from point A to point B and back (maybe). Must this administration put their dirty little fingers into everything? Apparently. By overlooking the fact that GM's sales drop is due to a global recession and instead pointing the finger of blame at Wagoner, they can now come in and appoint (directly or indirectly) a new CEO who will have no choice but to do their bidding—just look where the money is coming from. That's right, the government will now decide who will run GM and from what we have seen so far from this administration, their talent pool is not only polluted, it's extremely shallow.

Wagoner's has been one of the few at the helm of GM to be both a decent "Car Guy," and to understand the economics. His tenure at GM represented the first time in years that the auto maker had finally gotten back to making vehicles that people wanted to buy. Along with others, like Vice Chairman Bob Lutz, the face of GM was changing fast. From the fabulous new Camaro, to the world-class Corvette to fuel-efficient BIG SUVs and trucks that America loves, GM has 'em. 

Wagoner has continuously stated that he felt he was the one to lead the company through the crisis, but has been at odds with many on Capitol Hill who have held him responsible for years of missteps, mistakes and arrogance by the Big Three automakers. There's no denying that the US Automakers were serving up crap on four wheels back in the '70s and '80s, but that was over 20 years ago. The American auto industry has worked very hard to turn the ship around and are now putting out world class machines that are just as good, if not better than what is coming from Germany and Japan. 

When has the government ever done anything that is friendly to the automakers? The culprit here is not Wagoner or his counterparts at Ford or Chrysler. The blame for the shape of US Auto Industry lies with the same lawmakers who have "asked" Wagoner to take a hike. They are the ones who consistently yield to liberal tree huggers and global warming nuts, passing ridiculous regulation after ridiculous regulation without ever taking the time to properly assess how much of burden each new law and CAFE standard is placing ON THE BUSINESS of making automobiles (again, illustrating just how little this administration understands or cares for business). If they really wanted to help the automakers, why didn't they include a tax credit or incentive in the stimulus bill for anyone who purchases a new domestic auto? Duh! So what will life be like when bureaucrats take over the world's largest automaker? It can be summed up in just two words "Postal Service." Read The Wall Street Journal Report.