When President Obama last week announced a significant public ownership in General Motors, he was adamant that the government had no interest in meddling in the day-to-day affairs of the struggling auto company.
Unfortunately, it took only a few days before federal lawmakers took it upon themselves to browbeat beleaguered GM and Chrysler executives over the way they plan to downsize the number of dealerships across the country.
“I honestly don’t believe that companies should be allowed to take taxpayer funds for a bailout and then leave it to local dealers and their customers to fend for themselves with no real plan, with no real notice, with no real help,” said Sen. John D. Rockefeller IV, D-W.Va.
That statement, and the fact that automakers were hauled before Congress to be grilled on dealer closings, is a perfect illustration of the conflicts of interest inherent in government ownership of the businesses.
Congress needs to refrain, however difficult it may be, from using its political power to bully and micromanage an industry over which it has significant financial leverage.
We have a great deal of sympathy for the auto dealers who are losing their livelihoods as the two automakers try to re-emerge as successful ventures.
The closings of a total of 3,400 General Motors and Chrysler dealerships have been poorly justified. Dealers often make significant contributions to the social and economic fabric of their communities and their losses will reverberate.
Nevertheless, the fact that frustrated lawmakers already are trying to take matters into their own hands is a worrisome harbinger of things to come. Projections already have shown how difficult it is going to be for a retooled GM to turn a profit — without taxpayers absorbing huge losses up front.
Congress should not lay any additional bricks on that already heavy load by questioning every move the automakers make.
