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by Mark Silva
Michigan Gov. Jennifer Granholm says that, at a time of warranted "sacrifices'' in the struggling automobile industry, the White House forced-out, resigning chairman of General Motors is "a sacrificial lamb.''
"Rick Wagoner has worked for that company for 31 years, and he is a good man,'' the Democratic governor said in an appearance on NBC News' Today show this morning. "He clearly is a sacrificial lamb...
"But I think he would say he is doing what is important for the future of the company and the future of jobs,'' Granholm said.
"What the Obama administration is saying is that there are going to have to be sacrifices all around,'' the governor said.
With Obama today making further federal aid from GM and Chrysler conditional on corporate reform -- after $17.4 billion in aid already offered -- demanding that the ailing automakers complete plans for reorganization along a more effective business model, the governor suggests that the government will still have to step up for the automakers.
"Why isn't it succeeding? They were in the middle of a massive restructuring plan,'' the governor said. "The bottom line, is though, that this country needs a manufacturing industry, and needs an automotive industry... These companies are in the middle of this recession like everybody else. Nobody is buying cars.''
The question, she asked, is "what would be the cost of not helping this industry?... It's three and a half million jobs,'' not only in auto manufacturing, but also in the many industries that support it. "It's the backbone of the manufacturing sector.''
Comments
I feel sorry for the guy. Its too bad that the President can't fire Pelosi, Reid, Schumer, Rangel, and Reid, Then maybe we could start making progress.
Posted by: Paul | March 30, 2009 8:41 AM
Wioth the AIG debacle and now this, we're seeing why potential beneficiaries of government help turn it down, why banks scramble to give back money they've already received. Government says, "If you accept this money, we will micromanage your business. We who have never met a payroll, who have never planned a product, who have never run a factory, we know better than you what your products should be, who you should employ, how you should compensate your people, how your business should be run." What businessman would be driven, except by the extremes of desperation, to accept a deal like that?
Posted by: DaveB | March 30, 2009 9:13 AM
Unfortunately, as with most things in life, it's a lot more complicated than it seems. The global shockwaves will be catastrophic! http://www.carnorama.com/
Posted by: Car Norama | March 30, 2009 9:47 AM
Sacrificial lamb my @ss. If you are going to pay the president of a company 25 million a year....it damn well better not lose 10% of it's share in sales and 98% of it's stock value. Are you guys for real?
Posted by: bill r. | March 30, 2009 11:46 AM
Paul:
We could start making real progress if Obama could fire Republicans Boehner and McConnell - leaders of "The Party of No".
Posted by: BC | March 30, 2009 3:33 PM
bill r., no question the bottom fell out during Wagoner's tenure, but do you really think the govt. should be using this bailout money as leverage to remove CEOs? What does Obama or anyone in his Administration know about running a car company?
I say let them file Chapter 11. The kind of systemic restructuring GM needs, including getting out from under pension/health care obligations, can only be done in bankruptcy court. The idea that bond holders, creditors, unions, etc. are just going to agree to huge concessions is unrealistic. The current "plan" of the last two Administrations, of giving short term operating loans for a couple months and then forgetting about it until they come back for more, is throwing good money after bad and really needs to end. GM needs to sink or swim on its own, and I think the govt has had plenty of time to figure out whether short term operating loans are helping GM survive a tough time, or merely prolonging the suffering of a dying company. Sadly, I think it is the latter.
Posted by: Herbie H. | March 30, 2009 4:29 PM
Herbie....Why did it take this long? When did failure become acceptable to companies. Good lord, if you are going to pay 25,000,000,00 in salary...shouldn't you actually get results?
Posted by: bill r. | March 30, 2009 6:57 PM
The TARP deal was largely constructed outside the Obama Administration's control, but it looks like it has served the purpose of letting Obama's team learn some great lessons. They have learned that populist sentiment is that execs are getting off scott free (or even partying with the bailout money). And the taxpayers are keen for a little punishment. This is a quick and easy way to build Populist support by showing that they are demanding the heads of the folks who 'caused' this. it might not be fair, but when the government is your banker, you better expect that politics come with the cash.
Posted by: jhubcap | March 31, 2009 11:28 AM