Mark Naison: George Bush's Refusal to Rescue General Motors Cements His Legacy of Hardship and Pain

Roundup: Historians' Take

[Mark Naison is Professor of African American Studies and History, Fordham University.]

The refusal to support an emergency loan to General Motors during the final days of his administration may go down in history as the most arrogant and ill informed decision George Bush has taken during his entire presidency- other than his decision to invade Iraq.

The General Motors Corporation is the anchor of an entire region, with factories and parts plants employing large portions of the population in Michigan, Ohio and Kentucky while its dealerships and suppliers are a major source of employment in every portion of the nation. Allowing this company to go bankrupt, and risk dissolution, while the federal government is rescuing banks and insurance companies who employ a fraction of the workforce General Motors does, displays a staggering insensitivity to the human costs of unregulated markets and laissez faire economics

If General Motors fails, factories and dealerships will close, hundreds of thousands of people will lose their jobs, hundreds of thousands more will lose their pensions. But that's only the beginning of the hardship. Business districts dependent on GM workers and their families will be abandoned and boarded up,,towns and municipalities will be forced into bankruptcy. and tens of thousands of homes owned by GM workers and retirees will go into foreclosure. The psychological costs of this trauma may be even greater. Every lost job, every lost pension, every failed business, leaves deep scars, some of which last a lifetime, and puts families and communities in jeopardy.

Just look at cities like Youngstown Ohio, Homestead Pennsylvania and Flint Michigan which were hit by factory closinngs in the 1970's and 1980's .They have not recovered TO THIS DAY, Their factory districts are still scarred with vacant lots and piles of rubble, large sections of their residential neighborhoods look like ghost towns, their business districts are shabby and struggling, and young men stand idle outside bars and groceries.

That this happened, episodically and incrementally in cities across the nation in the 70's and 80's is one of the great tragedies in modern American history.To allow it to happen again, on a much larger scale, because of refusal to use 25 billion dollars from a 700 billion dollar bailout package on the grounds it was meant for banks, not an automobile company, is simply unconscionable.

Only someone who has never walked the streets of Flint, or Youngstown, or Buffalo, or North Philadelphia.could make a decision like that. I would like to take Mr Bush and Mr Paulson on such a walk. Let them see the boarded up factories, the weed filled lots, the aba ondoned churches with stained glass windows once lovingly constructed with the contributions of thousands of immigrant workers. Let them visit the schools and look into the eyes of the men on street corners who have long given up on looking for work.

Take that walk with me,, Mr President and Mr Secretary, and then tell me, and the people who live in Michigan, Ohio and Kentucky, that we have to let "the market" resolve the fate of General Motors,

When factories close and industries fail, we lose income, we lose confidence, we lose pride, we lose hope we lose a sense of purpose.. James Mc Murtry, in his song, "We Can't Make it Here Anymore:" lays those consequences out with brutal clarity

That big ol' building was the textile mill
It fed our kids and it paid our bills
But they turned us out and they closed the doors
We can't make it here anymore...

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More Comments:

Robert Lee Gaston - 12/5/2008

As I recall there was a great deal of Democrat comment about how the big three CEOs arrived in Washington, and very little about the U.S. Auto makers problems.

It may be interesting to see if Saints Nancy and Harry can put together a veto proof bridge loan (read bail out) package. It’s about time they had a real test of their leadership. It will also be a demonstration if they have the ability and the guts to really deliver to important constituencies (Midwest big city Democrats and labor unions). They should have the votes, so let’s see.

As a GM stock holder who has already taken my bath. I have become convinced that Chapter 11 Bankruptcy is the best solution to GM’s current problems. If you check out your 401K you will probably find that you too own some of these companies.

The Democrats and unions fear Chapter 11 because it would likely set aside and radically changes current contracts, and allow the companies to restructure to the benefit of the company without an overriding regard to the unions. The judges and receivers must consider stock holders, congressional Democrats just caree about unions. Chapter 11 may reduce wages and benefits, but it may well also help save a great many middle class retirement plans.

Jeanne DiOrio - 11/17/2008

General Motors should be helped and helped fast. The economic chaos that would follow GM's closing would be devastating to the entire country and the death bell here in the Youngstown/Warren area. Millions around the country would be effected.

George Bush can't leave office fast enough for me with his smugness, arrogance and stupidity!!

James Symanski - 11/16/2008

Mr. Naison's article utterly lacks any analysis of the situation.

Yes, it's bad when lots of people lose their jobs and cities fall apart. But Naison's premise that this result necessarily follows from Bush's current position is no more than sloppy assumption.

The UAW could offer to take some temporary wage reductions to help GM, and -- accepting Naison's premise -- save jobs and cities. Instead UAW says it will do nothing of the sort. UAW has no problem threatening to tank the economy as it tries to scare people, such as Naison, into suspending their critical thinking skills.

GM is too big, and needs to restructure, GM could lay out some plans, for all to see, showing how it plans to get into the black. It could list the models it think it needs to cut, and the factories it needs to shutter. But we hear only silence on that count.

So we have a union that refuses to put any skin in the game, yet wants $25 billion in cash for its health fund -- on top of $25 billion in "emergency" loans and $25 billion in loans for auto industry retooling. We have a company that wants billions in loans (likely never to be repaid) with no credible plan to pay it back.

And we have those, such as Naison, who swallow the GM/UAW propaganda hook, line, and sinker. The idea that the world boils down to binary choices -- such as either hand $25 billion-plus to GM/UAW or tank the economy -- doesn't fly. Naison's knee-jerk screed doesn't rise above the level of an hysterical letter to the editor.