Bailed-out GM, Chrysler push back on fuel economy

Environmental and watchdog groups question whether it is appropriate for GM to lobby a government that owns a stake in it.
Environmental and watchdog groups question whether it is appropriate for GM to lobby a government that owns a stake in it. (Paul Sancya)
Washington Post Staff Writer
Friday, January 14, 2011

General Motors and Chrysler, the bailed-out automakers still partially owned by the government, have joined an industry coalition that this week lobbied against proposed federal rules on fuel efficiency.

The attempt to push back against regulations pursued by environmental groups follows the automakers' efforts last year in which they opposed measures in an auto safety bill, which had been supported by the Obama administration.

The notion of federally owned companies lobbying the government - at times on the opposite side of the architects of their bailout - has drawn repeated criticisms from environmental organizations, safety advocates and watchdog groups. They say the government should have used its influence to block the companies from interfering with legislation that could improve the public welfare, such as environmental controls and safety enhancements.

"Even when the government owned 61 percent of General Motors, the company was arguing against government proposals on auto safety and pollution controls," said consumer advocate Ralph Nader. "As the owner of the world's second largest auto company, the government could really have made the company a model."

It didn't, in Nader's view.

"It's hard to make something like this up," he said.

The government owned 61 percent of GM after the bailout, but a public offering of stock in November reduced that stake to 33 percent.

The government owns 9 percent of Chrysler, a far lower stake. As a result, critics have focused on GM's lobbying efforts.

All along, Treasury officials have said they would try to let GM operate as if it were a normal commercial enterprise, owned by private parties. Otherwise, political meddling, among other things, could hamper the company in its recovery.

A Treasury spokesman said Thursday that the department's position hasn't changed.

"The administration has been true to their word from the start and has allowed us to make the business and commercial decisions," GM spokesman Greg Martin said.

Even though the government has a stake in the company, Martin said, "GM still retains the same First Amendment rights its competitors do. When you consider we are a global company that sells a machine that weighs several thousand pounds with an equal number of parts, there are very few policy issues that don't affect us."

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