Robert Stein 1924-2014

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Monday, March 30, 2009

What's Good for General Motors...

As news sinks in that President Obama has, in effect, fired the head of GM, it recalls that half a century ago President Eisenhower asked the man in that position to help him run the country.

When Ike picked Charles E. Wilson as Secretary of Defense in 1953, Congress wanted Wilson to sell his GM stock, which he reluctantly agreed to do. But when asked if he could conceive of making a decision adverse to the corporation, Wilson said yes but added that he could not imagine such a situation "because for years I thought what was good for the country was good for General Motors and vice versa."

Now, in an era when the auto industry is dragging down the US economy, the Washington Post reports, "The Obama administration has forced the longtime head of General Motors to resign and said yesterday that it would withhold additional federal aid to the auto industry unless the ailing companies undertake changes they so far have been unwilling or unable to make."

As the President promises to make Detroit "much more lean, mean and competitive than it currently is" in return for more bailout billions, there is the mirror image of unease about the symbiotic nature of that relationship.

The White House's willingness to take over GM is in sharp contrast to its hands-off approach to the banks in the plan to make toxic assets disappear. Does anybody in Washington know more about making cars than making loans?

After four stormy years of trying to modify and unify the Armed Forces, when Charles E. Wilson stepped down, Eisenower said he had managed the Defense Department "in a manner consistent with the requirements of a strong, healthy national economy."

Can Obama find someone to reverse the process now?

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