A. MCFEATTERS: Downshifting in descent

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By Ann McFeatters

COMMENTARY:

DETROIT -- It's surreal to be here in the Motor City these days, wondering how or if it will reinvent itself. As Pittsburgh was once Steel City and then became a mecca for medical researchers, one wonders if this symbol of man's ingenuity in moving around will find new life or decay even more.

A bankrupt General Motors Corp., to be controlled by the U.S. government, is a truly extraordinary development. We've gone through so much economic turmoil and angst in the past couple of years that we've stopped being stunned by the unbelievable - the collapse of the biggest auto manufacturer in the world.

President Obama jokes about being celebrated as the auto executive of the year, but in this downtrodden, depressed city, that's not funny. Michigan Gov. Jennifer M. Granholm warns that Detroit's troubles will soon be America's problems. (A play on that old bromide, "What's good for General Motors is good for the country.")

Even those of us who have little faith that the federal government can or should solve our trickiest problems have to hope that somewhere in the long, gray corridors of power there are some bureaucrats with brilliant ideas about how to pull a car company out of the muck of years of bad decision-making and unexpected catastrophes.

Well, we can hope.

In Michigan, thousands of beautiful, shiny new GM cars are driven along dreadful roads full of potholes and dangerous cracks. (So where is the stimulus package?) Will the government be able to repair those cars when they start breaking down? Will government employees start doodling designs for tomorrow's vehicles on their scratchpads?

In fact, right now, we have nothing but questions. Will the government buy only GM vehicles when it buys new fleets? Will the government give itself a dispensation from meeting tough new fuel-efficiency standards? Will the government treat the United Auto Workers as friends, enemies or nonentities? Will GM dealerships in the states of powerful members of Congress be shuttered with the same frequency as those in other states? What about closing factories - who will make such decisions? Is it possible that politics won't be a factor when it seems to be a factor in everything else?

It's hard to get our arms around the idea of how GM will look after the government gets through with it. Will it exist? Will it still make cars the world wants to buy? Is it realistic to think the government will ever get out of the car business? Will anyone ever invest in GM again?

The evolving GM bankruptcy process will be so complicated that such questions will be tamped down so far that ordinary mortals (and car buyers) will never know answers to some of the questions even if the company avoids liquidation. It is, in a word, a mess. GM's stock fell from about $56 a share five years ago to $1.22 this month.

For most of us, the decline of General Motors is sad, even though the company came to represent corporate arrogance, preferring to lobby its way out of problems instead of competing in a changing marketplace. For the more than 325,000 employees who used to make up the GM work force, it's catastrophic. People stopped buying cars when the housing and financial markets collapsed and jobs began disappearing. All of a sudden, the unthinkable happened.

Nobody knows if Mr. Obama's gamble in taking over GM, drastic as it is, will work. You can find experts on both sides of the argument. But nobody is optimistic about the future of the automobile industry in America.

It seems to be a given that we've fallen into a deep pit and nobody knows how we will get out. Ninety percent of economists may agree that the recession is nearing an end, but that does not mean unemployment won't hit double digits. It doesn't mean foreclosures will stop. And it doesn't mean a healthy GM is in Detroit's future.

Ann McFeatters is a columnist for Scripps Howard News Service.