…is good for America, or to be completely accurate, “What was good for our country was good for General Motors and vice versa”, or so said Charles Erwin Wilson, Ike’s Secretary of Defense back in the 50’s. He believed that anything that was good for GM was good for America, because the two economies were inexorably intertwined. But what is good for General Motors?
I’ve been following the bailout of the Big Three for a long time. And I’ve got some ideas on a REAL solution…not this three-card Monte they’re playing in Congress. Real solutions. Here’s my ideas:
- Allow/force the Big Three into a prepackaged or standard reorg bankruptcy. This will allow them to break the union contracts, restructure the pension plans and health plans, eliminate surplus capacity by closing unneeded factories, reduce the workforce without a “jobs bank” program, and make deep cuts into their dealer networks.
- Repeal the CAFE regulations, and allow the Big Three to make vehicles that people want to buy, without being forced to build vehicles nobody wants.
- Pass a federal law that forces “Right to Work” in every state, thus breaking the back of the unions. Nobody will be forced to join a union in order to get a job. This would make it possible for the Big Three to compete with the “transplant” factories in the Deep South.
- Force Cerebus to finance their own bailout of Chrysler, or face divestiture of their assets, selling off Jeep and Dodge, and shuttering the Chrysler brand.
- Force each car maker to present a realistic plan to return to profitability – selling off or shuttering unsustainable brands (Hummer, GMC, Saab, Pontiac, Mercury, Chrysler) to strengthen the survivors (Chevy, Cadillac, Buick, Ford, Lincoln, Jeep, Dodge).
- Force each company to adopt a executive and board compensation plan that rewards meeting sales and profitability goals, with no rewards when sales and profitability goals are missed.
Do that, and there is no reason I can see that the American auto industry will not survive – and thrive. Will Congress pursue this path? Not unless they realize that the American public is fed up with CEOs feeding at the public trough. It’s time to put Congress – and the nation – on a diet. THAT’S what’s good for General Motors…and what’s good for America.