On the brink of financial ruin through a series of events, many of which could be laid squarely at the government’s feet, the American automobile industry was left with two choices: declare bankruptcy or go crawling to the government for a multi-billion dollar bailout.
In response, the government said, “Let’s do both.” In a display of sinister Machiavellian engineering, the U.S. government then went on to nationalize the auto industry while simultaneously claiming to save the day.
The government began by doing as the auto industry asked: bailing them out. Of course, this was done with American tax dollars at the expense of every tax-paying citizen, but the government would prefer we credit them with the herculean effort.
Unfortunately, nothing from the government comes free — unless you don’t pay taxes to begin with — and so the government quickly went about seizing power at both General Motors and Chrysler.
From the beginning it was clear the government had plans of taking control of the companies when they began hinting that American auto dealers would soon be creating “greener” cars. General Motors quickly unveiled a concept vehicle which might as well have been their premiere golf cart. GM’s CEO, Rick Wagoner, was also personally and publicly asked to step down — a polite way of saying “fired” — by the new acting CEO, Uncle Sam.
This token firing was an attempt by the government to create a scapegoat and the illusion that they were fixing what was supposedly wrong at the company. This also marked a low point in the American free market system as, for the first time, the government was dictating who would hold what jobs in our capitalist system.
The next step in the government’s plan was the master stroke of their sleight of hand. As the new acting controlling interest at both Chrysler and GM, the government set guidelines to protect their investment. To the American public, whose taxes financed this venture, it was made to look as though they were looking out for all of us; after all, the federal government is always careful with how they spend our money, right?
The dirty little secret is that the government was setting the automakers up for failure. Their demands, particularly under the shattered economic climate, were impossible to meet. And so, with illusions of a heavy heart, the government took Chrysler by the hand and guided them into inevitable bankruptcy. Even as I write this, the same is being done to GM.
The outcome Detroit sought to avoid by humbling themselves and crawling at the feet of politicians in Washington D.C. has nonetheless
come to pass, as the government always intended it to. The result will
be the same as it would have been months ago, except for a couple of
major factors.
First, the government held off bankruptcy for the auto
industry just long enough to take control of it, effectively
nationalizing all domestic automobile production with the sole exception of Ford Motors. This will likely go down in history as the largest bait-and-switch power grab orchestrated by the federal government … at least since the days when Native Americans were rounded up and placed on reservations.
Second, billions of tax-payer dollars have been squandered to pay for the smoke and mirrors spectacle the government used to thinly veil this takeover. That, unfortunately, is something we should all be familiar with by now.
General Motors and Chrysler have now been taken over by an
ever-expanding government which has also taken great steps to protect one of the key factors in their decline: the labor unions whose crippling demands weakened the companies for years. These unions, can now look to the government to provide for them in a way they only could have imagined before, which will naturally cause greater problems within the companies.
The government doesn’t really mind this, however. Now that GM and Chrysler are being run by Congress and the White House, there will be substantially less demand that they are being run efficiently or turning a profit. After all, the government never requires one of its operations be competitive in the marketplace . . . just ask the postal service.
The company boards of directors are being replaced with
political appointees who know nothing about manufacturing or the auto
business — or business in general — but fully intend to push their
agenda. With government appointees firmly in control, Detroit will go further than ever before in providing “green” vehicles no one will want to drive.
GM’s new golf cart, and a host of vehicles similar to it, will
be on the road in a few years, whether America wants them or not.
We’re now just a few years from seeing Cadillacs which run on
batteries and protect their passengers with a tinfoil-like shell to cut
back on weight and increase fuel efficiency.
Of course, the cars don’t really have to sell well. The companies
will be secure, as the government now has a stake in them and cannot
allow them to fail . . . at least not beyond the bankruptcy they have
already been driven to, anyway. No, our tax dollars will see to it
that, even as General Motors and Chrysler continue to lose money and
market share well into the future, they will always be there, trudging
along as yet two more soulless government entities.
**Admin. Travis Sedars is an expert on the auto industry, with experience in parts, sales, and management at the Sedars family auto dealership. The Sedars family has been one of North Iowa’s largest auto dealerships for over 3 generations.
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