Staying out of politics right call for GM
August 28, 2012
Staying out of politics right call for GM
By DANIEL HOWES
The only surprise in General Motors Co.’s decision to bar presidential candidates from its plants at least through Election Day is that the move is a surprise to anyone paying attention.
The “Government Motors” moniker, a flatlining share price and the undeniable fact that $49.5 billion in taxpayer money rescued the Detroit automaker from collapse are inconvenient truths that complicate the business of selling cars and trucks to Republicans and Democrats, middle Americans and the coastal elite, union members and salaried employees.
Add the crosscurrents of presidential politics culminating in the most consequential election in a generation, and it’s a shrewd business decision for a seller of big-ticket consumer products to try to distance its name, its property and even its people from the presidential campaign.
Why should GM give politicians and their proxies in both parties a platform to remind would-be voters all over again of the contentious facts surrounding the bailout of most of Detroit’s auto industry? We’re talking the bipartisan bailout that was begun by Republican George W. Bush (who said he’d do it again) and executed by his Democratic successor, Barack Obama — both without the official approval of Congress.
GM should not provide either side the rhetorical clubs to pummel its reputation yet again. Never mind that both sides still will wield those clubs whether they have access to GM sites or they don’t, as Vice President Joe Biden demonstrated last week with his “Osama bin Laden is dead, and General Motors is alive” crack.
It’s no accident, either, that GM confirmed Monday that it would end a 30-year practice of providing hundreds of cars, free of charge, to the Republican and Democratic national conventions. Partisans in both parties are doing GM no favors in the run-up to November with their selective touting of the facts, so why should GM leaders do them any favors?
They shouldn’t. GM’s best answer to the infantile politicization of its every move is to run its business well, to deliver strong products and strong profits, and to craft credible solutions for trouble spots in Europe. Performance and an exit strategy for the federal government would boost GM’s share price, shaving losses to be borne by Treasury, not playing the pawn in presidential politics.
The facts that the Treasury Department still owns 26.5 percent of GM and that Treasury has detailed no plan to sell its shares (and lose up to $25 billion, by the most recent estimates) effectively negate GM’s comparatively strong balance sheet and financial results. They also deeply rankle the company at its highest levels.
The fact that the Chevrolet Volt, an extended-range electric car with a gasoline engine on board, is falsely labeled an “ObamaMobile” when it was announced two years before he took office is an affront to the facts and proves mendacity can be a bipartisan affliction.
The fact that Team Obama’s endless crowing of the bailout’s success reminds investors of the government’s ownership and depresses the value of GM’s shares is as counterproductive to the company’s forward movement as Team Romney’s tortured position on the bailout and its pounding of the United Auto Workers, the partner GM has to live with long after the campaign signs disappear.
If it were up to CEO Dan Akerson, his management team and GM’s directors, they would move to end government ownership of GM tomorrow — if not sooner. The feds’ stake doesn’t help sell cars and trucks. Nor does it enable the company to easily eschew political entanglements or to close finally a controversial chapter in its history.
Politics are a fact of life in modern American business, especially for an auto industry whose safety and fuel economy standards, to name two, are closely regulated by federal departments and Congress. But lending whatever credibility a company possesses to either candidate supported by less than half of the respondents to most polls is not a savvy marketing move.
GM is making the right call. If it wants to perform a public service, too, it could use its recent history to remind sentient voters that no institution, even the federal government, can deny financial reality forever. Eventually, the bills come due.