In three words: Everything and nothing. Megan McCardle has more:
GM’s main problem is not that the market is unreasonably unwilling to finance a potentially profitable company. Nor that it can’t produce an awesome small car that shockingly few people want to buy. (Believe me, as the owner of a tiny, ultra-efficient car, I would that there were higher demand for my rapidly depreciating asset). GM’s main problems are
1) A terrible, bloated cost structure
2) A terrible, bloated bureaucracy
3) A bunch of meh car lines
Which of these is the government going to solve? That terrible, bloated cost structure supports a bloated union whose jobs are the entire rationale for the government intervention. Leaning on the parts suppliers just risks UAW jobs further down the supply chain. Maybe we can take it out of the budget for copy paper and pencils.
Forgive me if I am skeptical that the government is going to show GM how to streamline its bureaucracy. Nor do governments historically have a good record as cutting-edge auto designers.
All the government can give GM is money. Our money. Perhaps we should change the name to American Leyland.”