GM Accentuates the Positive in Congress

(MoneyWatch)  A lot of the General Motors appeal for financial help from Congress this week is devoted to a self-serving pitch for what a swell job the current management is doing, under CEO Rick Wagoner.

GM says it is now building "the best cars in its U.S. history," according to the presentation GM submitted the Senate Banking Committee on Nov. 18, and the House Financial Service Committee, on Nov. 19.

If I were a senator or a representative on the receiving end of this pitch, I would have been wondering, "If things are so great, why are you here?"

In addition, much of the 11-page slide presentation is devoted to the "bold" actions GM has already taken, to "rightsize" itself, like cutting headcount 47 percent since 2002, and cutting manufacturing capacity 36 percent, or 2 million units, from the end of 2004 to the end of 2010.

GM can rightfully claim to have swallowed a lot of bitter medicine. But it's only stating the obvious to say that the marketplace forced a lot of those actions on GM, utterly against its will.

It's also understandable that the company needs to brag just a little, to underscore that it's viable -- if only it can get enough money to tide it over. An aspect of proposed government bailout funds is that the money must be restricted to quote-unquote "viable" companies.

But it's a fine line between too much doom and gloom, and not enough. Everything was going to plan, the slide show seems to say, until the present credit crisis came along and hurt consumer confidence. That would have been hard to swallow, even before the present crisis.

The real meat of the presentation ?€" especially for politicians with voters back home to worry about -- was a chart that claimed a "full collapse" of the Detroit 3 would cost close to 2.5 million jobs, including collateral damage to suppliers, and a general "lack of economic activity" that would follow.

Just the Detroit 3 alone would lose about 1.2 million jobs, according to GM. If that's too much doom and gloom, better too much in this context than not enough, even if it's unflattering to the present management.