Issue: Apr 2009


Departure of Wagoner Should Make Us Pause, Reflect, and Shift Gears



by John Larkin

Although the Obama administration has asked GM’s top exec to step down as part of its efforts to enforce stricter rules on federal bailout funds, Rick Wagoner made many of the right changes at GM, said Kent Hughes, director of the Science, Technology, America, and the Global Economy (STAGE) program at the Woodrow Wilson Center.

“Wagoner fought to keep morale at GM high and developed a restructuring plan that will almost surely define the GM of the future. In the end, however, he was cast as a symbol of an American auto industry that needed more radical change.”

“Detroit has made many mistakes,” Hughes said, “but we have all contributed to Detroit’s woes—demanding low gas prices and large cars, tolerating currency intervention by our competitors, and failing to develop policies to free American industry from the burden of health care costs.”

What is sure, Hughes said, is that we need a vibrant automobile and manufacturing sector to produce the almost $700 billion in goods and services that will let us stop going further into international debt.

“The departure of Wagoner should be an occasion to shift from a focus on personalities to a focus on the importance of the auto industry in turning innovations into competitive products.”


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