GM has long been hampered by laws, unions, and management trouble.
In the face of impending crisis, the current administration embarked on a plan to save the auto giant, which coincidentally allows the company to quickly downsize; shedding debt, renegotiating contracts, and closing plants.
If the way to making a leaner, more manageable company is to allow it to bypass the constraints that have hampered it, it would seem that this should be the first available option to the company. In other words, if it is laws, unions, and bureaucratic meddling which hamper the success of a company, why not rid the industry of these problematic interferences?
Many in America believe the free market has failed. They point to the current recession and global credit crunch as examples. However, it is impossible to say the free-market has failed when in reality, the market is not free.
Various actors influence and prohibit the market from being truly independent and dynamic. Take the current GM situation as an example. Instead of allowing a poorly performing company to succumb to its own poor performance and fail, billions of tax dollars are being pumped into a company that cannot guarantee it will be better off after the government bailout than before.
Government intervention is not the answer. A corporation like GM is run by its board of directors and its stock holders. They should be the controlling forces behind a restructuring, not the Federal Government. By taking over GM the government enters uncharted territory. As citizens we have no promise–other than Obama’s word–that the government will revive GM and leave the scene.
Tragically, I can see no quick exit for GM. Congressional representatives will find it all too easy to continue their involvement in GM to ensure jobs, money, and commerce flow to their districts. If GM does not quickly right itself, more money will be pumped into it because the current administration will not want to fail to keep GM viable.
Today should have been the end of an automotive giant; instead GM has entered a coma. The doctors will keep GM breathing, pumping money into its lungs, checking its pulse, and giving transfusions of new leaders. When will GM die? Maybe soon, but it will consume billions of dollars in resources before its final collapse.