What’s a company supposed to do? Virginia Postrel looks at GM, which lost 1.1 billion last quarter. She points to a Holman Jenkins column (sorry no link):
GM’s boss should be the media’s darling, running his company to provide job security and health care for its workers first, second and third. Wonder why GM invests just enough in new product to keep the game going, not enough to make its cars really sought after? Because the extra capital that would have to be invested goes instead to doling out gold-plated health care — no copays, no deductibles — to workers and to plumping up their pension fund, which two years ago required the largest corporate debt offering in history to top off…. GM made an effort to imply that Zeta resources were being deployed to speed up redesigned pickup trucks and SUVs, which will begin to appear next year. This was smokescreen. Zeta was shelved to free up money in coming years to meet the pension and health-care obligations to workers — money that manifestly won’t be coming from sales of G6s, Cobalts and LaCrosses, the new models that GM had nursed high hopes for.
Get more scoop here.