It's Not GM Chairman Rick Wagoner Who Should Go, But Senator Chris Dodd

Auto Chief to Pay Price for Bailout Although GM Cars Are Much Improved

March 29, 2009
By: Dave Rogers

Sen. Chris Dodd, D-Connecticut, has unmitigated gall to demand the resignation of GM Chairman Rick Wagoner as a condition of further government aid to the embattled automaker.

It was only a few weeks ago that Sen. Dodd messed up the AIG (American International Group) bonus deal, saying it was OK that the insurance firm executives got huge bonuses.

That boo-boo caused a huge mess in Washington, leading to potentially unconstitutional tax penalties against the greedy executives who retained the bonuses. (Although some wisely gave up the windfalls.)

Actually, the taxpayers (if they are awake at all) should demand the recall of Sen. Dodd, a posturing mandarin of Washington if there ever was one.

Sunday it was reported Wagoner is stepping down from his post with GM under pressure from the government. The deal was laid at the feet of President Obama, but insiders said Dodd was the driver.

Does it really make sense to ax an auto CEO on the eve of giving the firm billions in bailout money?

And, bring in somebody new?

Is this just change for the sake of change?

Sure, the Washington pols got their noses out of joint when Wagoner and the other Detroit dunces climbed down from their private jets with tin cups in hand a few months ago.

Actually, Wagoner has masterminded the Chevy Volt and has helped make massive improvements in GM cars during his tenure at the helm of the car-maker that once was the world's leading corporation.

Check out the Chevy Malibu, the Saturn and some high end Cadillacs. They're pretty good and, according to the United Auto Workers, mostly made with domestic content and assembled by Americans.

Wagoner slashed expenses $9 billion a year and closed 12 assembly plants while shifting GM from big trucks and SUVs to smaller, more fuel efficient cars.

But this brainless activity proves that Detroit does not have a monopoly on stupidity; Washington really has shown leadership in that category.

We see this latest move, dumping Wagoner midstream, as another example of why conservatives want to keep government out of private business. Politics, after all, is not calculated to make a profit. Unless you are getting donations to your campaign committee.

For the record, here are the top donors to Dodd's campaign over the past five years: Citigroup Inc $316,494; United Technologies $264,400; SAC Capital Partners $248,500; American International Group $223,478; Royal Bank of Scotland $218,500. Those figures are courtesy of the Center for Responsive Politics.

Dodd also apparently had a sweetheart deal with Countrywide Mortgage that threatened to bring on federal prosecution. So, his skirts are definitely not clean.

By the time you read this harangue Monday morning, Obama will be speaking on television about the U.S. automotive industry. A task force is slated to offer recommendations to Obama on how to deal with the automakers.

GM seeks more than $16 billion in additional government funds as it tries to survive the economic crisis. GM and Chrysler have already received billions from Congress and most of it is already frittered away.

Of course you can't blame the automakers for the market downturn, and it's disingenuous to blame Wagoner for the financial mess that was caused mainly by the mortgage industry and banks.

But, obviously, Sen. Dodd is finding a scapegoat and, sadly, the President is going along with him. Obama no doubt is under the gun to retain support from key Democratic senators like Dodd, chair of the powerful Banking Committee.

Wagoner is under fire from Congressional crows for being too slow to restructure GM before the financial downturn spiked last fall. He also took heat, justifiably so, for flying to Washington for congressional hearings in a luxurious corporate jet with other Detroit CEOs.