Obama Demands GM CEO To Resign and Rick Wagoner Quits

The Obama administration asked Rick Wagoner, the chairman and CEO of General Motors, to step down and he agreed, a White House official said.

On Monday, President Barack Obama is to unveil his plans for the auto industry, including a response to a request for additional funds by GM and Chrysler. The plan is based on recommendations from the Presidential Task Force on the Auto Industry, headed by the Treasury Department.

The White House confirmed Wagoner was leaving at the government’s behest after The Associated Press reported his immediate departure, without giving a reason.

General Motors issued a vague statement Sunday night that did not officially confirm Wagoner’s departure.

“We are anticipating an announcement soon from the Administration regarding the restructuring of the U.S. auto industry. We continue to work closely with members of the Task Force and it would not be appropriate for us to speculate on the content of any announcement,” the company said.

The government should have let GM and Chrsyler fail last Fall when they requested $ billions in federal bailout aid. President Bush kept them afloat with $9.4 billion to GM and $ 4 billion which turn out to be just the start – as everyone feared at the time.

Of course, Obama could say NO to ANY bailout aid and allow GM to file for bankruptcy. Once in bankruptcy, the GM management could eliminate union contracts to allow them to become profitable again. But, the unions hate this idea and Obama is beholden to them for support and campaign cash.

So…….

The Obama Administration, including Treasury will become the de facto CEO of GM. Will this nationalized or socialized company be able to return to profitability or will it continually rely on government for viability?

Obama says government.

But, the market will have other ideas and so might American taxpayers when they get the bill.