Assigned Reading: GM CEO: Bankruptcy Likely; Firm May Leave Detroit
GM shares dropped by 20 percent today on news that the venerable automaker may leave Motor City and sell off plants as part of its government-advanced restructuring plan. The way that the company has stiffed bondholders–with the government’s help, 89 percent of the company would be held by the government and the United Auto Workers–it should come as no surprise to the folks in Michigan that long-held policies of kowtowing to union thuggery would combine with this administration’s vilification of success and support of said thuggery and spell disaster for the state.
Ideally, for General Motors to survive, it would have to take a good, long look at what foreign automakers are doing, successfully, with their stateside operations. And it would have to do what’s best for itself and its investors, rather than for the government currently holding the carrot and stick.
Unfortunately, rather than shift operations to a state with a right-to-work clause, such as Bobby Jindal’s Louisiana or Mark Sanford’s South Carolina or Rick Perry’s Texas, should such an exodus from Michigan take place, GM and its Obama-selected chief executive will likely ship jobs to Canada or elsewhere. And with it would go a valuable opportunity, rife with potential and the chance for the company to wipe the slate clean and start being profitable again, much like the aforementioned success of foreign automakers like Hyundai and Kia with plants and facilities in right-to-work states like South Carolina and Alabama.
Making such a move would benefit General Motors, would benefit post-Katrina Louisiana or unemployment-ravaged South Carolina, and it would benefit America — but it would not benefit Barack Obama, nor would it benefit the Democratic Party. As it stands, the Democrats and their president would rather lose thousands of jobs than take a political hit, would rather see an American stalwart, General Motors Corporation, go the way of the Chicago Motor Corporation, American Motors, Studebaker or Packard than abandon the party agenda.