Jalopnik’s Editor and I have had some major differences of opinion. Ray Wert recently opined that a Chrysler-GM merger made good business sense. I disagreed. When Jalopnik sold “Save GM” t-shirts and claimed it was ironic, I said it was absurd. Today, Wert posted an editorial entitled “The Case for GM CEO Rick Wagoner.” Again, I disagree. The rant is deeply misguided, the logic and conclusions just plain wrong. And in a twist of [yet more] unintended irony, the editorial stinks of the sloth and corner-cutting that’s brought GM to its knees.
“While we’ve been a vocal critic [sic] of GM’s glacial restructuring effort,” Wert writes. “We’ve got to say the automaker probably should stick with the girl they brought with ‘em to the ball — no matter how ugly.” This is no argument at all– unless you find the admonition against ‘changing horses mid-stream’ inherently compelling. General Motors has followed this non-strategy– stick with the same tired brands, the same poor products and planning, and the same incompetent management– for the past four decades. To no avail.
So what’s the justification, in Wert’s mind, for backing a loser? “Mostly because we can’t name anyone better who’d understand the product and the bureaucracy of the General.” Obviously, Wert’s inability to name a suitable replacement for GM CEO RIck Wagoner doesn’t preclude the possibility of his or her existence. In fact, it underscores the paucity of imagination suffered by the pro-Big 3 establishment collectively; demonstrating General Motors’ longstanding assumption that if they can’t do it, it’s not possible. Remember when GM said it was nearly impossible to make money on small cars?
Is it really that hard to find an executive that meets Wert’s supposed requirements, understanding GM’s product and bureaucracy? Even I understand GM’s products, and I have no managerial skills above the level of lemonade stand. As for grokking the complexity of GM’s bureaucracy, this is a double-edged sword. Any executive that comes from within GM doesn’t just understand the bureaucracy– they are the bureaucracy. While the FBI recruits mobsters to act as informants because they understand the mafia, it doesn’t recruit mobsters to work as actual FBI agents.
Wert opposes bringing in someone outside of GM because “… to bring in someone completely new to figure out that bureaucracy takes time GM just doesn’t have without tens of billions more in public monies.” But that’s the real issue here. This is public money. And while the taxpayers don’t get stock certificates (perhaps they should), why would we want the same management that carelessly squandered billions of dollars of GM’s privately-raised money? We have no reason to believe that Rick Wagoner’s cronies will be more careful now than they were before.
As for figuring-out bureaucracy, a new CEO doesn’t need immediately understanding of the company’s bureaucracy. They need to keep the company running more than the “two months” that Wert over-pessimistically prognosticates GM has left.
The “better scheme” that Mr. Wert then proffers reads like a sort of class president campaign flyer. “What this automaker needs … [is] an external force moving the current leadership to change quickly.” They also need 1000 mile-per-gallon sports cars. Neither is possible. Neither is orbiting possible. General Motors does not change quickly, and Rick Wagoner has never shown any proclivity for the kind of fast action the company so desperately needs. Hanging-up the phone on Carlos Ghosn doesn’t count as fast business action any more than driving to DC.
Not all that surprisingly, Mr. Wert’s pipe dream plan of adding yet another layer of bureaucracy to General Motors isn’t even internally consistent. Too little oversight of Wagoner, and we’re at the status quo, with public funding down the drain. If a board of independent assessors is going to scrutinize Wagoner’s every decision, why have him there at all? You lose the purported benefits of Wagoner “knowing his way around GM’s bureaucracy.” And in so doing, you actually amplify GM’s traditional problems.
I certainly don’t think Red Ink deserves all the blame for decades of chronic mismanagement at General Motors. But he’s the man in charge of the firm now. The executive who’s been CEO for eight and a half years. Prior to that, since 1992, Wagoner high level executive positions. So he deserve plenty of blame. And he can no doubt survive taking one for the team with the small fortune he’s banked over the past 16 years.
It’s intriguing that GM posted a mea culpa to the Facts and Fiction site a few days ago. But absent major action, it’s meaningless. Mr. Wert can’t sprinkle their support for the status quo with a handful of criticisms and think it properly qualifies his opinions; that is the very definition of an apologist.
The “Case for Rick Wagoner” ignores reality. GM’s CEO is a failure. What’s more, he’s the public face of a company that needs a complete change of direction AND identity. General Motors must ditch Wagoner to tell all the disenchanted former GM owners and all those opposing the bailout that things really are going to be different. For GM, keeping Wagoner would insist on the status quo. For Mr. Wert’s part, he fills the role of accomplice journalist fairly well.