GM Closes American—Not Mexican—Factories After Collecting $11 Billion in Subsidies

General Motors last week announced it would close five manufacturing plants, four in America and one in Canada. President Trump responded to GM by threatening to cut the automaker’s subsidies unless it protected American jobs:

Very disappointed with General Motors and their CEO, Mary Barra, for closing plants in Ohio, Michigan and Maryland. Nothing being closed in Mexico & China. The U.S. saved General Motors, and this is the THANKS we get! We are now looking at cutting all @GM subsidies, including….

— Donald J. Trump (@realDonaldTrump) November 27, 2018

Trump’s threat triggered the usual bout of shock and horror that we have come to love and expect from America’s “virtuous” conservatives—the sort of people who still prudishly read the Economist or think elitist lapdogs like Ben Shapiro are edgy.
This faux outrage is omnipresent: “How dare the President tell a private company how to manage its affairs. GM should be free to replace as many Americans with foreigners as they like!” This is more-or-less the argument made by Veronique de Rugy in her piece for National Review.


Her argument is flawed—and not only because it ignores the existence of moral and fiduciary obligations beyond the scope of mere profit, but because it is grounded in a number of false assumptions.

De Rugy opens her piece with the standard “virtuous” refrain:
[President Trump] seems to believe that because the government bailed out GM . . . that that company owes the U.S. jobs and factories. It doesn’t.
It does. GM filed for government-assisted Chapter 11 bankruptcy protection on June 1, 2009. American taxpayers subsequently bailed-out GM to the tune of $11.2 billion—and this does not include the plethora of subsidies and kickbacks GM received over the past decade. GM only exists as a going concern because the U.S. government wanted it to exist. This is a cold, hard fact: a fact de Rugy cannot simply ignore because it offends her free-market dogma.
Uncle Sam doesn’t do charity. Uncle Sam is a gangster. If he gives you money you better believe he expects something in return. The moment GM accepted public money is the moment GM ceased to operate as a purely private company. GM owes Uncle Sam. GM owes us. GM cannot accept our money and then close down our factories. The company currently operates five plants in Mexico and four in Canada—those should be first up on the chopping-block. If not, then what do we pay them for?

https://nationaleconomicseditorial.com/2018/12/05/gm-closes-american-factories/