Like hitting a wall

Like hitting a wall

The Mahoning Valley’s optimism about General Motors’ presence here has changed with head-turning speed.

A little over two months ago, Rick Wagoner, General Motors chairman, appeared at Lordstown to announce the company’s plans to built a new product, the Chevrolet Cruze, at the Trumbull County facility. Discussing the current Lordstown product line, Ed Peper, GM North American vice president of Chevrolet, said at the time, “Our dealers are asking for many more Cobalts than we can build.” U.S. Rep. Tim Ryan described GM’s announcement as what would be viewed a decode from now as “the day the Mahoning Valley turned the corner.”

Against that level of optimism in mid-August, Friday’s announcement of 1,100 layoffs at the Lordstown complex hit with the force of an exploding airbag.

And the bigger question — can General Motors survive the current business downturn and cash crunch? — has implications from coast to coast.

To big to fail

The American automobile business, of which General Motors is the largest entity, cannot be allowed to fail, anymore than the nation’s credit markets could be allowed to collapse a month ago. It is that simple.

Just a few days ago, we viewed the auto industry’s problem as one that should be on the top of President-elect Barack Obama’s agenda. That time table is obsolete.

The first order of business for Congress when it returns from its election recess must be a response to the cash flow problems facing the domestic automobile industry.

Congress approved a $700 billion bailout package for investment bankers and mortgage houses. Shoring up the auto industry will require only a fraction of that amount and it is incumbent on a caucus of congressmen from auto-producing states and regions to convince their colleagues of the need to act.

Automobiles drive the economy. The multiplier for every production line worker is 5-to-1, a ratio that doesn’t exist in any other industry and cannot be ignored.