John Paul MacDuffie is an associate professor of Management at the Wharton School, University of Pennsylvania, and co-director of the International Motor Vehicle Program (IMVP). We asked him for his thoughts on President Obama's plan for the auto industry. The new auto industry plan represents more aggressive action than we've seen before; government isn't just writing checks based on proposals from the automakers. But the new plan still stops well short of true nationalization; government won't be managing these companies. Obama, in other words, has found a middle path.
General Motors has come to Washington, begging for a $25 billion bailout to keep it and its ailing Detroit counterparts going next year. But nobody seems too thrilled about the prospect. Liberals dwell on the companies’ gas-guzzling sport-utility vehicles. Conservatives obsess over all the well-paid union members with gold-plated benefits. And people of all ideological backgrounds remember how they used to buy domestic cars, years ago, but stopped because the cars were so damn lousy.