GM's Waggoner Begs For $10B Bailout... To Capture Chrysler

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Bailouts are the name of the game these days and Rick Waggoner wants his cut.

The CEO of General Motors has been hounding the U.S. Treasury Department for about $10 billion so he can proceed with his takeover of Chrysler.

Why not? Treasury Secretary Henry “Hank” Paulson seems to be bailing out everyone else, such as banks, investment houses and insurance companies.

And, Waggoner is trying to make the case that GM is too big to fail and its demise would cause too much pain. Think of all the union worker salaries, the pension funds, the medical expenses that would all go swirling down the drain if GM fails. Particularly in such key election swing states as Michigan and Ohio.

Never mind that taken together, his firm, Chrysler and Ford lose about $2 billion each month.

Could it be that management skills have somehow been lacking? Could there be a reason why not many drivers want to buy GM’s gas hogs any more?

Here’s another example of a powerful CEO who long espoused the magic of the market not wanting the market to work at all.

In my home state of Virginia, the Republicans have a term for party members who don’t follow conservative dogma. They call them RINOs (Republicans In Name Only).

Maybe there should be CINOs (Capitalists In Name Only), too.

This post first appeared on BNET’s The Corner Office blog.

Tags: Chrysler LLC, General Motors Corp., Bailouts, Insurance, Benefits, Payroll Solutions, Business Operations, Corporate Insurance, Human Resources, Peter Galuszka

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jnaeb

10/30/08 | Report as spam

RE: GM's Waggoner Begs For $10B Bailout... To Capture Chrysler

I can't agree more.

There are a lot of people hoping to put their money where there mouth is to buy clean and/or efficient vehicles, and decades after the first oil shocks, and huge inroads by Japanese and German car makers, it is deja vu.

American car manufacturers are not committing to making or selling products we need and want. Instead of being part of the solution, they continue to be a part of the problem, promoting and selling gas guzzlers. They are currently planning on reducing R&D and promoting pickups and SUVs.

And all this is not to mention that they are going to "benefit" at the expense of laying off thousands of hard working Americans if they do merge.

I will personally do everything in my power to block any such bailout, unless there are some strong and enforceable caveats attached to such a bailout. A significant amount of such a bailout only makes sense if it is targeted at increasing fleet fuel mileage (both by sales mix and fuel mileage increases), R&D, training, and manufacturing capacity to build and sell electric, hybrids and plug-in hybrids, clean diesels, NG, and new lightweight vehicles.

The US Big 3 just don't seem to learn from their mistakes, which depending on who you talk to is either crazy or just stupid.

They deserve to fail if they can't learn. I only empathize with those who will suffer undeservedly from the poor vision and strategy of the companies leadership.

Jacob