Barack and Me
Take a gander at what happens when Schumpeterian creative destruction is jettisoned in favor of Obanomical hope and change. Recall that way back in 2009 the President singlehandedly averted the horrors of a lawful reorganization of General Motors under the Bankruptcy Code. For the greater good, Obama fired the CEO, nationalized the company, elevated an unsecured union above senior secured creditors, and closed 1,500 GM dealerships, destroying 100,000 jobs.
Now, William Tate at American Thinker reports that race and gender politics trumped economics in selecting dealerships for closure.
Decisions on which car dealerships to close as part of the auto industry bailout -- closures the Obama administration forced on General Motors and Chrysler -- were based in part on race and gender, according to a report by Troubled Asset Relief Program Special Inspector General Neal M. Barofsky.
I followed Tate's link to the source document. You should do likewise, but for a flavor read the following paragraph from "Lesssons Learned."
Stated another way, at a time when the country was experiencing the worst economic downturn in generations and the Government was asking its taxpayers to support a $787 billion stimulus package designed primarily to preserve jobs, Treasury made a series of decisions that may have substantially contributed to the accelerated shuttering of thousands of small businesses and thereby potentially adding tens of thousands of workers to the already lengthy unemployment rolls — all based on a theory and without sufficient consideration of the decisions’ broader economic impact. That the automakers have offered reinstatement to hundreds of terminated dealerships in response to Congressional action without any apparent sacrifice to their ongoing viability further demonstrates the possibility that such dramatic and accelerated dealership closings may not have been necessary and underscores the need for Treasury to tread very carefully when considering such decisions in the future.
Meanwhile, Megan McArdle at the Atlantic points out that GM's financial strategy has changed about as much as Fannie Mae's and Freddie Mac's, which is not at all.
GM just announced that it's going to buy AmeriCredit. Why? Because without a captive finance arm, GM can't reach customers who have terrible credit:
I can't wait for Michael Moore to update Roger and Me, his 1989 exposé of gross mismanagement at GM.
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May '10
Re: Barack and Me
Wow. As I said in some other thread, millions of Americans voted for this guy with a sort of unspoken agreement with their new President that race-obsession would be put behind us. The opposite has happened, and the feeling of betrayal is palpable. This guy is creating a calamity for himself and his party, and he has no clue.
Jun '10
Re: Barack and Me
From: "GM terminates contract with Anoka's Main Motors", Star Tribume, 6/16/2009
[story about (Fox News) Gretchen Carlson's parents losing their GM dealership]
The dark clouds seemed a million freeway miles away in Main Motors' bright showroom last week. "You walk through the building, and you see customers you recognize, people whose families have come here for years," Karen Carlson said. "You know, when we got the termination notice, it was from 'General Motors.' There wasn't even a name attached to this. It was so cold. The shame of it all is, you walk downstairs and see our staff with our customers, and it's so warm in here."
http://www.startribune.com/local/north/47970131.html
Jul '10
Re: Barack and Me
My favorite part of the whole auto takeover is that they are now actively targeting the Tea Party crowd with their "patriotic" marketing.
http://www.youtube.com/watch?v=Ezk0e1VL80o&feature=PlayList&p=344995659B0E46C5&playnext_from=PL&index=30&playnext=2