Avoiding the Technical

The government should act like a board of directors to General Motors. It's not necessary for every board member to have experience in the company they oversee, but they can offer a useful perspective. They can set goals and create an overall strategy.

This is what the government should do for the auto industry. It can express its desire to see new models that are more fuel-efficient, more environmentally friendly and more in line with the kind of vehicle that fits our future. This is a matter of setting the best course for society as a whole, and it falls within the scope of what government should do.

However, it would be a disaster for government bureaucrats to get involved in the day-to-day operation of the auto industry. Decisions affecting the long-term survival of the auto business are best left to the professionals. Find the right team of managers and give them plenty of space.

The Obama administration has said it will be involved in the auto industry only for a short period of time, and that's the wise approach. The government needs to get out of this arrangement as quickly as possible, but it's hard to set a precise timeline now. Ultimately, it will depend on a number of factors: economic conditions, the quality of the new managers and competition from other automakers.

Setting a timeline could pressure managers into cutting corners to meet a certain schedule. That's not the way to get this broken industry back on track.

By Yash Gupta

 |  June 2, 2009; 10:50 AM ET
Category:  Economic crisis Save & Share:                 
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