35thCamaroZ28

Another classic case where the government creates the problem, and offers the solution.

Gaccett32

I see my original post has spurred a lot of debate. As a poltical science major I can assure you that I did not reach the conlusion that this move was socialism in action by any media, but by my own assessment of what has occurred. Now I persoanlly don't like socialism, but if that is what the people want then so be it. But what has occured is a complete disception of the Amercian public by calling this a bankruptcy and covering what is truly happening. US gov. 60% owenrship, Canada gov. 12.5%, the UAW 17.5%(who by the way as I've pointed out before is in bed with the democrats and is one of the major reasons why GM and US auto industry has failed). Private ownership 10%. That is barely corporatism and is all but complete gov. ownership, which is socialism. Corporatism is where the co. is privately and publicy owned and the gov. works with the private to do what is best for the public. If Obama and the news were to come out and say they are seizing GM(which is what is really happening) the public would be in uproar. Obama has stated that this is only temporary, except that if it is short term then why do it in the first place? As we've seen with the TARP funds, the banks, and Obama's refusal to allow them to repay and manipilating their business practices; once the gov. is in it won't let you out under Obama. As far as assessing how this will impact GM viability in the future, it depends. If Obama does give it up, then what has been done does help(reducing UAW contract, cutting dealerships, maybe cutting unprofitable divisions), it might become profitible again, but there are still other issues(like GM breaking/changing manufacture contracts and paying penalties). But if Obama does not give GM up, it will be far worse and possibly never recover. GM will not operate based on viability and profitability(not that it did over the past 20yr but they tried) but on political agenda's.

Now this whole side argument of national def and US industry. National defense is provided for in the Const. Defense itself is not an economic indeavor and therefore cannot be classified as socialist. Furthermore defense contracts are handled by the private sector, and while oversighted by the gov. (for obvious reasons) it is still independent of outright gov. control. The argument that the auto industry is vital to def. as you've stated really is only applicable to WWII. The auto industry and US industry outside of def. contracting is not vitally important to national def. Def contracting has its own manufacturing system(some done in the US but much is done over seas). GM does some manufacturing of various military vehicles, but they won a biding contract in which foreign co. bid as well.

Route66Wanderer

Government by its very nature is inefficient but even with its inefficiency, there are certain services that only a government can effectively provide such as defense/military, protecting the borders, the court system, etc.

However, most areas of our lives are best left to ourselves to manage and private industry is the extension of that.

Regardless of what term is used to describe this country's current state; with the Federal government owning 60% of GM and some 30% of Chrysler as well as significant parts of our insurance and financial industries; it is reaching far, far beyond what most people know is the proper role of a government that is supposed to be a democratic republic.

What is happening is not about "saving" GM or preserving American manufacturing; it's about power - who has it and who doesn't.