Monday, June 1, 2009

The North American auto industry, North American governments, and ruminations on Franklin D. Roosevelt

I don't have any stunning insights on the latest auto news from the last 24 hours - Chrysler has cleared an apparent final hurdle to get OUT of bankruptcy, just as General Motors is preparing to go IN to bankruptcy, again with a relatively quick re-emergence. Apparently Rush Limbaugh will have something on his radio show later today in which he asks for a Supreme Court nominee who has "empathy" for the poor GM bondholders, but that's not surprising - Limbaugh probably wants the U.S. Olympic team to lose in 2010 because Obama is president.

But it does make you think about the unprecedented steps that Barack Obama, George W. Bush, the U.S. Congress, Stephen Harper, and the Canadian Parliament have taken over the last several months, in which the U.S. and Canadian governments now own/will own significant stakes in multi-billion dollar North American businesses. This is more commonplace in Europe, in which major companies are often partially owned by national governments, but it's a relatively new phenomenon here, at least at this scale.

The common refrain - and in fact one that I've used at times - is that this is an undesirable outcome, but it's better than the other outcomes. Truthfully, does anyone see an alternative in which General Motors could have stayed away from liquidation without U.S./Canadian government participation? Even Bill Gates and Warren Buffett couldn't have saved the auto industry.

Which leads me to FDR. I'll probably dig into this a little more deeply later, but Roosevelt was known to argue that he was truly a conservative, and that the unprecedented steps that he took were taken in order to prevent an even more drastic alternative as envisioned by Norman Thomas and others.

Now I know it's common to paint FDR, Obama, and even (in some circles) Dubya as wild-eyed liberals, but perhaps they're more conservative than we think. And if anyone wonders whether Roosevelt is truly the ultimate liberal darling, just ask the Japanese Americans.

Perhaps I'll pursue these thoughts at a later time, but I wanted to stick a few thoughts out there now.

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