by Mitch Kokai
Senior Political Analyst, John Locke Foundation
The American government should not own a car company.
That was a wise stance back in 2008, before Barack Obama was elected president; it was a wise stance from 2009 through 2013, when the U.S. government owned a large but gradually shrinking portion of General Motors stock; and it is a wise stance today. Sadly, those who liked the era of “Government Motors” are determined to avoid any serious examination of that policy — perhaps because President Obama and his fans have persuaded themselves that the auto-industry bailout was one of the biggest successes of his presidency.
That argument was metaphorically kicked in the crotch this month when the public learned that GM continued to make cars with a life-threatening defect during the era of government ownership. Joe Biden liked to boast, “Osama bin Laden is dead and GM is alive!” Indeed he is dead, and so are 13 people who were involved in car accidents linked to a defective ignition switch. …
… [M]ost disturbing is that at least some GM engineers knew about the problem for years. In 2002, the automaker approved the design for the new ignition switch from manufacturer Delphi even though the supplier told them that initial tests showed the switch didn’t meet GM’s specifications. The company investigated the switches, and found them faulty, for at least a decade. Perhaps the most jaw-dropping detail is that the cost of replacing each switch was 57 cents.
The New York Times reported that engineers at GM reviewed data in the black boxes of Chevrolet Cobalts at a meeting on May 15, 2009, and confirmed that the potentially fatal defect existed in hundreds of thousands of cars. The Obama administration and GM’s management finalized the terms of the bailout at the end of that month. It’s not yet clear who at GM knew this shocking and scandalous information, but at least some GM employees knew they were selling dangerous cars at the precise moment they were asking for taxpayer money to stay in business.
This is a gargantuan problem for GM, but so far the press is covering it as a corporate scandal, not a government scandal. Very few individuals in the Obama administration, the auto industry, or the press want to reexamine the bailout and the government’s role in helping to keep these unsafe cars rolling off the assembly line and onto the nation’s roads.