5 ms·

"What's good for GM is good for America" used to be a quote around Washington. What an awful company, and a cautionary tale about taking "public/private partner

by api 12y ago

"What's good for GM is good for America" used to be a quote around Washington. What an awful company, and a cautionary tale about taking "public/private partnership" way too far. GM also ruined Los Angeles -- look up the transit system LA/OC used to have prior to GM's purchase of it and lobbying. LA would be a much nicer and more livable city had GM not had such influence. GM really should have been allowed to die in 2008.

mdellabitta 12y ago
AFAIK, the reason why it wasn't was that it would ruin the supply chains of the other automakers.
- organsnyder 12y ago
  Not sure why you're being downvoted. That's a huge part of the reason: Due to the nature of the auto industry, many suppliers only have a few customers; take away a third of a company's business, and there's a good chance it will fail. The entire economy of Michigan (and many neighboring states) would have collapsed. Over here in West Michigan, we have many companies—ranging from mom-and-pop injection mold shops with 50 employees to large companies like Gentex, Delphi, etc. Those companies were already struggling back in 2008; GM going away would have meant the death of most of them. I hate many of GM's historical business practices as much as anyone (there used to be two streetcar lines within a quarter-mile of my home, dammit), but the saving of GM was a critical component in preventing a catastrophic depression, especially for Michigan—which was already suffering before the Great Recession hit.
  - davidw 12y ago
    IIRC, even companies like Toyota who were not in trouble wanted to keep the supply chain around and thus favored the bailout.
- Retric 12y ago
  It's not all or nothing, the government could have broken GM up into component parts as a condition of a bail out. AKA killed GM but kept the parts. Chances are many parts would have failed and been bought up over time but as smaller companies the market could have dealt with this much easier. There many have also been some part that becomes much stronger when no longer part of the collective. EX: Verizon vs. the old AT&T and the new AT&T.
csours 12y ago
BIG DISCLAIMER: I WORK FOR GM! Disclaimer: What follow are my personal opinions! Given the above, I do not think GM has always been right. GM has been part of many morally questionable practices. I think GM was on a terrible course from the mid 1970's to the early 2000's[0]. Those diesel engines in particular were incredibly shitty. My dad was one of those guys who loved the idea of diesel and who got the stares and the smirks.[1] In the early 2000's they started to try to change. It is very difficult to change a large organization like GM.[2] I don't think today's GM is the same GM from 1920, 1939, 1970, or 1990. If it was, I wouldn't work here. Many say it would have been worth it to let GM die. Under circumstances other than the 2008 economic downturn, it might have been. Much of the severity of the 2008 crisis was largely (immediately) due to shock related to the collapse of Lehman Brothers [3] and the refusal of anyone to take over those assets at any price. Very few people worked for Lehman Bros. A LOT of people work in the automotive ecosystem. Before bailing out GM, the govt and GM DID look around for other financing/buyout options. No one wanted to take that on. The saying "whats good for GM is good for the country" is largely outdated nowadays, but many people still think that way, and the collapse of GM would have been psychologically devastating, as well as financially devastating to many thousands of people. [0] The infamous "ignition switch" design process started in 1997 (Valukas PDF page 35). The Valukas report is very interesting, I recommend it for everyone who is interested in system design. http://www.nhtsa.gov/About+NHTSA/NHTSA+Electronic+Reading+Room+(ERR) http://www.nhtsa.gov/About+NHTSA/NHTSA+Electronic+Reading+Ro... (bullet 4) [1] My family has owned a 80's VW diesel rabbit, an 81 diesel Audi 5000 (20 years old at time of purchase), an 80's diesel Suburban (terrible engine), and various diesel work trucks. [2] GM is not a single organization. It is more accurate to think of all the external organizations such as: UAW-GM, GM branded dealerships (which are not owned by GM), GM Suppliers (which also supply other companies). Then there are all the internal organizations: GM Truck Manufacturing, GM Car Manufacturing, Global Brands, etc, etc, etc. [3] http://en.wikipedia.org/wiki/Causes_of_the_Great_Recession http://en.wikipedia.org/wiki/Causes_of_the_Great_Recession http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/fcic_final_report_conclusions.pdf http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/f... From the above: In addition, the government’s inconsistent handling of major financial institutions during the crisis—the decision to rescue Bear Stearns and then to place Fannie Mae and Freddie Mac into conservatorship, followed by its decision not to save Lehman Brothers and then to save AIG—increased uncertainty and panic in the market.
ptaipale 12y ago
Whatever you think of GM today, I find this half-hour movie from Chevrolet-making in 1936 absolutely fascinating: https://www.youtube.com/watch?v=8bT6txm4RpA https://www.youtube.com/watch?v=8bT6txm4RpA This was slightly before the great strikes in Flint, Michigan, and those working conditions are obviously both hazardous and extremely inconvenient. But it shows what an amazing enterprise a large car factory was already then, and the world has come far since those days.
cafard 12y ago
Charles Wilson, who was in Eisenhower's cabinet, said that he had assumed that what was good for America was good for GM and vice-versa. In the context it was less obnoxious than it now sounds--he meant that a strong economy benefited both.
cafard 12y ago
Charles Wilson, who was in Eisenhower's cabinet, said that he had assumed that what was good for America was good for GM and vice-versa. In the context it was less obnoxious than it now sounds--he meant that a strong economy benefited both.

by api 12y ago

mdellabitta 12y ago

AFAIK, the reason why it wasn't was that it would ruin the supply chains of the other automakers.

organsnyder 12y ago
Not sure why you're being downvoted. That's a huge part of the reason: Due to the nature of the auto industry, many suppliers only have a few customers; take away a third of a company's business, and there's a good chance it will fail. The entire economy of Michigan (and many neighboring states) would have collapsed. Over here in West Michigan, we have many companies—ranging from mom-and-pop injection mold shops with 50 employees to large companies like Gentex, Delphi, etc. Those companies were already struggling back in 2008; GM going away would have meant the death of most of them. I hate many of GM's historical business practices as much as anyone (there used to be two streetcar lines within a quarter-mile of my home, dammit), but the saving of GM was a critical component in preventing a catastrophic depression, especially for Michigan—which was already suffering before the Great Recession hit.
- davidw 12y ago
  IIRC, even companies like Toyota who were not in trouble wanted to keep the supply chain around and thus favored the bailout.
Retric 12y ago
It's not all or nothing, the government could have broken GM up into component parts as a condition of a bail out. AKA killed GM but kept the parts. Chances are many parts would have failed and been bought up over time but as smaller companies the market could have dealt with this much easier. There many have also been some part that becomes much stronger when no longer part of the collective. EX: Verizon vs. the old AT&T and the new AT&T.

csours 12y ago

BIG DISCLAIMER: I WORK FOR GM! Disclaimer: What follow are my personal opinions! Given the above, I do not think GM has always been right. GM has been part of many morally questionable practices. I think GM was on a terrible course from the mid 1970's to the early 2000's[0]. Those diesel engines in particular were incredibly shitty. My dad was one of those guys who loved the idea of diesel and who got the stares and the smirks.[1] In the early 2000's they started to try to change. It is very difficult to change a large organization like GM.[2] I don't think today's GM is the same GM from 1920, 1939, 1970, or 1990. If it was, I wouldn't work here. Many say it would have been worth it to let GM die. Under circumstances other than the 2008 economic downturn, it might have been. Much of the severity of the 2008 crisis was largely (immediately) due to shock related to the collapse of Lehman Brothers [3] and the refusal of anyone to take over those assets at any price. Very few people worked for Lehman Bros. A LOT of people work in the automotive ecosystem. Before bailing out GM, the govt and GM DID look around for other financing/buyout options. No one wanted to take that on. The saying "whats good for GM is good for the country" is largely outdated nowadays, but many people still think that way, and the collapse of GM would have been psychologically devastating, as well as financially devastating to many thousands of people. [0] The infamous "ignition switch" design process started in 1997 (Valukas PDF page 35). The Valukas report is very interesting, I recommend it for everyone who is interested in system design. http://www.nhtsa.gov/About+NHTSA/NHTSA+Electronic+Reading+Room+(ERR) http://www.nhtsa.gov/About+NHTSA/NHTSA+Electronic+Reading+Ro... (bullet 4) [1] My family has owned a 80's VW diesel rabbit, an 81 diesel Audi 5000 (20 years old at time of purchase), an 80's diesel Suburban (terrible engine), and various diesel work trucks. [2] GM is not a single organization. It is more accurate to think of all the external organizations such as: UAW-GM, GM branded dealerships (which are not owned by GM), GM Suppliers (which also supply other companies). Then there are all the internal organizations: GM Truck Manufacturing, GM Car Manufacturing, Global Brands, etc, etc, etc. [3] http://en.wikipedia.org/wiki/Causes_of_the_Great_Recession http://en.wikipedia.org/wiki/Causes_of_the_Great_Recession http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/fcic_final_report_conclusions.pdf http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/f... From the above: In addition, the government’s inconsistent handling of major financial institutions during the crisis—the decision to rescue Bear Stearns and then to place Fannie Mae and Freddie Mac into conservatorship, followed by its decision not to save Lehman Brothers and then to save AIG—increased uncertainty and panic in the market.

ptaipale 12y ago

Whatever you think of GM today, I find this half-hour movie from Chevrolet-making in 1936 absolutely fascinating: https://www.youtube.com/watch?v=8bT6txm4RpA https://www.youtube.com/watch?v=8bT6txm4RpA This was slightly before the great strikes in Flint, Michigan, and those working conditions are obviously both hazardous and extremely inconvenient. But it shows what an amazing enterprise a large car factory was already then, and the world has come far since those days.

cafard 12y ago

Charles Wilson, who was in Eisenhower's cabinet, said that he had assumed that what was good for America was good for GM and vice-versa. In the context it was less obnoxious than it now sounds--he meant that a strong economy benefited both.

cafard 12y ago