General Moters

  • May 1, 2015
    Guest Post

    by Rena Steinzor and Thomas McGarity, past presidents and founders of the Center for Progressive Reform. Steinzor is a professor at the University of Maryland Carey Law School, and McGarity is a professor at the University of Texas Law School. Steinzor is author of Why Not Jail? Industrial Catastrophes, Corporate Malfeasance, and Government Inaction. McGarity is author of Freedom to Harm: The Lasting Legacy of the Laissez Faire Revival.

    With the announcement that GM Chief Executive Officer Mary Barra received the outsized compensation of $16.2 million in 2014, what should have been a year of humiliation and soul-searching for that feckless automaker instead ended on a disturbingly self-satisfied note.  Purely from a public relations perspective, Barra worked hard for her money.  Appearing repentant, sincere, and downcast, she persuaded star-struck members of Congress that the company was committed to overhauling a culture characterized by what she called the “GM shrug,” loosely translated as avoiding individual accountability at all costs.  Even as she blinked in the television lights, GM fought bitter battles behind the scenes to block consumer damage cases and exploit corporate tax loopholes.

    Largely on the basis of her political adeptness, Barra has been taking victory laps in the business press, hailed as the rare (female) CEO who has led her corporation out of a morass that could happen to anyone.  This performance and the accolades it inspired provide a troubling coda to what was a destructive year for American drivers.  Dubbed “the year of the recall,” automakers recalled an unprecedented 64 million vehicles ‒ about one in five cars on the road; GM led with 26 million of this total.

    To restore justice to GM’s beleaguered customers – and the scores of families who lost loved ones in crashes caused by the defective switch – we can only hope that the Justice Department’s criminal investigation of the company and its senior executives results in prosecutions that could offset the unjust favors the legal system is already prepared to bestow.