After testifying to Congress yesterday, GM CEO Rick Wagoner’s ghostwriter took to the op-ed page of the WSJ to argue why his company deserves a bailout. It’s mainly a rehash, but it’s a good synthesis of the full argument in favour of a bailout. The key points
- GM has closed the quality gap with foreign cars, per various third party ratings and awards.
- GM has taken billions in costs out of normal operations over the years, and is now cost-competitive with the foreign automakers.
- But: “We can not slash our way to prosperity” (good line)
- The company has a number of innovative green cars just over the horizol (a little late on that)
- The auto industry spreads everywhere, not just Detroit (more of the “we’re going to nuke the economy” argument)
Nearly a half-century ago President Kennedy declared that his generation of Americans was living in extraordinary times and facing extraordinary challenges. Our times are no less challenging. They demand solutions that are creative and courageous.
Short-term government support to bridge the current financial crisis will enable GM to continue as an engine for prosperity and as a creator of vehicles and technologies that America needs. Such assistance will save millions of jobs now, and produce enormous benefits for years to come.
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