Economy Why General Motors Is Worth Saving
posted by November 10 at 14:30 PMon
General Motors will not see 2009 without a government bailout. What used to be the centerpiece of the American economy has a decent chance of not seeing Obama’s inauguration.
If this should happen, it would be an atom bomb dropping on the American middle class. It might be hard to see from here (or maybe not), but GM and the auto industry are among the few things that have worked in the US private sector, from a social and economic point of view. You know the deal. Work hard, turn in your hours, and you’ll be rewarded with the American dream: home, retirement, some vacations, and so on. Be part of the great, producing company, and all of this is yours.
On the other hand, the service sector that has come to dominate the US economy is most notable for producing shitty, disposable jobs that are considered a stepping stone to something better. So what future will we favor in these tough times—becoming underappreciated, union-less armies selling outsourced, imported goods? Or becoming a well paid worker that actually makes things?
And here’s what might be most shocking—despite being saddled with the costs and responsibilities of being the largest private pension and health insurance provider in the world, has made clever and key investments that deserve fulfillment. Yes, I’m talking about an American car-maker; hear me out.
Nevermind the now-defunct EV-1—the first modern mass-produced electric car. GM’s heavy-duty hybrid technology would be far more revolutionary than Toyota’s. Likewise, the technology in a Chevy Volt does a far better job of playing to the strengths of electric and gas motors than any competing hybrid. For more technical details, you should hop over to DearScience.org for an explanation.
GM has great ideas, their manufacturing quality is on par with the Japanese manufacturers, they have beloved small cars they’ve started pumping.
Early on in this crisis, we decided that AIG—an insurance company that made horrifyingly bad decisions—was worthy of rescue. We’re now up to $150 billion in a growing pit of despair attempting to save a company that did little to create or maintain a middle class. On the other hand, the same sum invested in American industry as loans would have a clear, immediate and profound effect on the economy—putting money into the pockets of line workers, new products on the global market that are competitive and even potentially make our society more energy efficient.
The alternative frightens me. If we allow GM and the auto industry to fail, it’s unclear what, if anything, would replace the key role it played in our economy. I cannot fathom how to renew an industrial middle class without the auto companies—and the vast manufacturing networks supported by them.