Conservative watchdogs have been barking that automakers like GM — in order to grab eye-popping $19,300-per-car incentives to sell Chevy Volts in China — “must share their technology with Chinese counterparts and produce the vehicles over there” (my respected colleague Paul Chesser, National Legal and Policy Center).
I admire their doggedness, but they are missing the real scandal. To quote the classic Hollywood line: “Forget it, Jake, it’s Chinatown.”
The Volt deal is business. It’s how deals are done in the fastest-growing market in the world. If GM is to continue growing in its most profitable market (GM is #1 in China), it must do 50-50 business with a Chinese partner just as every other American company does.
No, the real scandal here is how much U.S. industrial policy under Obama now mirrors Communist China central planning.
After all, China’s $19-grand subsidized slap at market capitalism is, incredibly, envied by a U.S. president who hands his own $7,500 electric-car subsidy to America’s upper class and wastes national resources to buy expensive electrics for his government minions. This is the stuff of despots, not democrats.
The offense here is government picking industries over consumers. Consider the Obama Energy Department’s extraordinary, ChiComm-like announcement this week that it is pushing ahead with its green five-year plan despite the Solyndra scandal:
“There’s one energy challenge that outweighs all the others in terms of economic, military and ecological importance. We’ve got to kick our reliance on oil. And to do this we’ve got to build a lot of electric cars,” writes the administration.
What’s next? Government plans to build TVs? IPads? Washing machines?
“As a result of this Review, we find that DOE is underinvested in the transportation sector relative to the stationary sector (energy efficiency, grid, and electric power),” continues the directive. “Yet, reliance on oil is the greatest immediate threat to U.S. economic and national security, and also contributes to the long-term threat of climate change. Barack Obama’s energy goals include reducing oil imports by one third by 2025 and putting one million electric vehicles on the road by 2015. The most important role of the DOE is investing in research to develop hybrids, plug-in hybrids, battery-electric, and fuel cell vehicles.”
This Gosplan drivel is also a straw man.
Contrary to Obama’s planners, oil is not a national security threat. Our ally Canada, after all, is America’s largest oil exporter. Where countries pose a security threat — Iran, for example — we simply outlaw trade. In fact, if the administration believed its own con, it would be helping develop — rather than hindering — America’s own bountiful domestic reserves of cheap, efficient, job-producing oil in the West and offshore.
But like China, Obama’s central planners are driven by ideological ends. The problem isn’t GM. Take away the governments of China and Obama, and GM would be producing unsubsidized cars that consumers want.