Former U.S. Auto Adviser: GM Recall Crisis ‘Emblematic’ of Cost Culture

For­mer auto advis­er Har­ry Wil­son said the gov­ern­ment-appoint­ed auto task force was com­plete­ly unaware of the Gen­er­al Motors’ igni­tion switch issue and not­ed the admin­is­tra­tion was hav­ing trou­ble get­ting infor­ma­tion out of GM when craft­ing the $49.5 bil­lion fed­er­al bailout.

Wil­son said the issue “sad­ly is emblem­at­ic of the cul­tur­al prob­lems” of GM. “They would do any­thing to save a pen­ny, includ­ing some real­ly bad deci­sions, both eco­nom­i­cal­ly and moral­ly. That was a part of the cul­ture that was dri­ven by a com­pa­ny that was liv­ing on the brink of dis­as­ter for many years pri­or to 2009.”

“We didn’t know about any­thing like this,” Wil­son said at a forum at the Brook­ings Insti­tu­tion on the fifth anniver­sary of the auto bailout. “Giv­en how hard it was to get data out of the com­pa­ny at the time, even if we had asked (GM) the point-blank ques­tion, I doubt we would have got­ten a straight answer.”

Cit­ing press reports, Wil­son said the recall issue appar­ent­ly was not passed on to the GM exec­u­tives with whom the Oba­ma auto task force dealt with as part of the $49.5 bil­lion GM bailout.

“It seems to have been basi­cal­ly stuck at the mid-lev­el of the engi­neer­ing depart­ment and not risen above that,” he said “These are all folks we nev­er met.”

For­mer auto czar Steve Rat­tner told reporters after the event that the auto task force had no idea about safe­ty prob­lems with defec­tive igni­tion switch­es. “As best we know, the senior peo­ple at GM didn’t even know about it, so they can’t tell you about some­thing they don’t know. We’re not foren­sic accoun­tants. We’re not FBI inves­ti­ga­tors. We had about 40 days to do all this due dili­gence and we can’t find some­thing like that out,” Rat­tner said.

Wil­son said the cor­po­rate cul­ture has improved dra­mat­i­cal­ly since then. Wil­son called the igni­tion switch fail­ure “inex­cus­able.” He said GM’s “siloed” cul­ture in which depart­ments didn’t talk to one anoth­er for decades still needs to be fixed. “The com­pa­ny still has a long way to go.”

For­mer Nation­al Eco­nom­ic Coun­cil direc­tor Lar­ry Sum­mers said he didn’t recall the issue ever com­ing up when he over­saw the auto bailout.

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