AND THEN THERE’S GM
Do you ever wonder if things in the news happen, or certain things are covered by the “news” media, just to keep We The People from paying attention to something really important? I believe that one of those times is happening right now. It seems the “news” media wants you to pay attention to the passing of the 41stPresident, George H. W. Bush, the Mueller “investigation,” the Trump-China Trade “negotiation”, the stock market unrest, Al Sharpton selling his “memoirs” to his own charity, which one of 30+ potential Democrats will actually run against Trump in 2020 and will there be a government “shutdown” over funding for the “Border Wall”?
Don’t get me wrong, each and every one of these stories has merit and should be reported, but in less than 10 days, an epic fail from the Jarrett Administration and Globalist Progressives, the GM “bailout”, and its result has all but disappeared from the news. The fact that We The People, through the Jarrett Administration, gave billions of tax dollars to “save” this repeat loser Legacy Company seems to be insignificant. And right now, in the midst of the greatest economic expansion in at least a generation, GM, lovingly known as “Government Motors”, is slashing 14,500+ jobs and shuttering 5 U.S. plants. How has this happened? For a decade now this “champion of industry” had been held up as the beacon of the “new economy”. Well, until President Trump and his policies made the “new economy” passe’.
To really understand this, we have to go back to the Jarrett GM bailout and what it really did. In simplicity, it protected GM from having to start “recovering” from decades of gross mismanagement, by going through the same bankruptcy proceedings that any other corporation would have to do when they became as “upside down” as GM was. This was sold to US as “saving a great American company that’s failure would add to the financial ‘disaster’ we were in at the time”. What it ended up being was a giant payback to a major Democrat campaign contributor and support operation, the United Auto Workers, and handing a substantial piece of the business to them. But I believe more importantly it allowed part of the “agenda” of the Jarrett Administration to be pushed, through GM.
This was a major piece of what has led to what happened last week. Under the “direction” of the regulatory bureaucrats that infested the Jarrett Administration, GM proclaimed it was going to lead the way in to the new world order of automotive engineering and production. They were going to show how to transform a “dinosaur” in to the lion of the “green” transportation renaissance. Since the rules of the day were that we were on the way to $4.00 gas, and how the internal combustion engine was destroying the World through “climate change”, it was time to go full on to the electric car. And GM was first to the rescue with the “plug-in hybrid” Chevy Volt. They did this in spite of the direct confrontation this was to the laws of physics and economics that I just wrote about recently- https://www.4pba.com/you-want-an-electric-car-really/?v=7516fd43adaaThis proclaimed “savior” of the future of the automotive industry, and of GM, has been an epic fail. Sales have been slow at best, even with major corporate fleet purchases and a $7500 tax credit. And as a result, on March 1, 2019, production of the Volt will end.
This is a great example of what results when government-driven crony capitalism happens. Because of the bailout, GM was obligated to disregard real situations in the marketplace and do whatever they could to please their new masters, the policy directors in the halls of the Jarrett White House. To hell with what the people want to buy, you will build what the new masters say works for their agenda. This was GM’s “Let then eat cake” moment. They also greatly underestimated the backlash from consumers who were really pissed off that their tax dollars were wasted just to promote the agenda. This, I believe, was a bigger piece of the slow sales of GM vehicles than anybody anticipated. Never let the intelligence of the American people be underestimated in the decisions made in the marketplace.
It will be interesting to see what actually happens next. Is the GM announced plan to close 5 U.S. plants and eliminate 14,500+ jobs what they really intend to do, or is this just their next play to hopefully get more out of the government to save a still grossly mismanaged company? Or will the Trump Administration play “hands off” and let GM go the route they should have gone 10 years ago, through bankruptcy? I don’t know but if I was to guess I believe the latter will happen and GM will either properly restructure, based on real market influences, or it will be relinquished to the graveyard of other businesses that chose government over the market in the past. And one last question, “What happens to the biggest benefactor of the bailout, the United Auto Workers union?” In the big picture we can only hope that a lesson, or lessons, has been learned. I guess we’ll see.
God Bless America! And America, please Bless God again!