Obama: 'No interest in... running GM'

by Mark Silva

"I recognize that this may give some Americans pause,'' President Barack Obama said today of his administration's decision to invest another $30 billion of public money in General Motors and take a 60-percent ownership stake in "the new GM'' that headed into Bankruptcy Court today -- a company that Obama has "no interest in... running.''

"Let me explain as clearly as possible why we are making this investment,'' Obama said in an address from the White House today, followed by a news conference with the GM CEO, Fritz Henderson, who replacedthe one whom the Treasury Department forced out in Detroit earlier this year.

"We inherited a financial crisis unlike any that we've seen in our time,'' the president said. "This crisis crippled private capital markets and forced us to take steps in our financial system and with our auto companies that we would not have otherwise even considered.

"These steps have put our government in the unwelcome position of owning large stakes in private companies, for the simple and compelling reason that their survival and the success of our overall economy depend on it,'' he said.

"Understand we're making these investments not because I want to spend the American people's tax dollars, but because I want to protect them,'' he said. "Instead of taking so much stock in GM, we could have simply offered the company more loans. But for years GM has been buried under an unsustainable mountain of debt, and piling an irresponsibly large debt on top of the new GM would mean simply repeating the mistakes of the past.

"So we are acting as reluctant shareholders, because that is the only way to help GM succeed,'' the president said. "What we are not doing, what I have no interest in doing, is running GM.

(Photo of President Obama, under the gaze of a predecessor's portrait, in the Grand Foyer of the White House today as he prepared to explain his administration's tactic with General Motors. Photo by Charles Dharapak / AP)

"GM will be run by a private board of directors and management team with a track record in American manufacturing that reflects a commitment to innovation and quality,'' Obama said. "They, and not the government, will call the shots and make the decisions about how to turn this company around.

"The federal government will refrain from exercising its rights as a shareholder in all but the most fundamental corporate decisions,'' he said. "When a difficult decision has to be made on matters like where to open a new plant or what type of new car to make, the new GM, not the United States government, will make that decision. In short, our goal is to get GM back on its feet, take a hands-off approach and get out quickly...

"I'm confident that the steps I'm announcing today will mark the end of an old GM and the beginning of a new GM, a new GM that can produce the high-quality, safe and fuel-efficient cars of tomorrow, that can lead America towards an energy-independent future, and that is once more a symbol of America's success,'' he said.

"I will not pretend the hard times are over. Difficult days lie ahead. More jobs will be lost. More plants will close. More dealerships will shut their doors, and so will many parts suppliers...

"But while the GM of the future will be different from the GM of past, I am absolutely confident that if well managed, a new GM will emerge that can provide a new generation of Americans with the chance to live out their dreams, that can out-compete automakers around the world, and they can once again be an integral part of America's economic future,'' the president said. "And when that happens, we can truly say that what is good for General Motors and all who work there is good for the United States of America.''