Bush to Meet with Domestics

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President George W. Bush plans to meet with top executives from General Motors, Ford, and DaimlerChrysler sometime after next week’s election. But the president seems to have ruled out any changes that might help relieve the pressure from the climbing cost of the automakers’ huge private healthcare systems.

Bush said last week in an interview with CNBC that automakers had to live up to their commitments.

“There’s a lot of people saying, ‘Well you need to take their health, their benefits that they promised off their hands.’ No I don’t think that’s the proper role of government. They made a private contract with their employees. They need to keep it,” Bush told CNBC.

Automakers and their partisans have made the argument that neither the Detroit automakers’ Japanese nor German competitors are saddled with the healthcare burden, which now exceeds $1500 per vehicle. Healthcare costs have now become the single largest competitive disadvantage the American car industry faces, they add.

One possible way for the government to help would be to have the Feds take over responsibility for catastrophic healthcare coverage, which is a significant burden for the automakers in and of itself.

Meanwhile, the American companies’ meeting with the President has become a major political football and something of an embarrassment for all concerned. The White House was miffed last summer when news of the pending meeting leaked to the press. The President suddenly found himself overbooked and while the Detroit executives have said the timing of the meeting didn’t matter and noted that Bush is dealing with multiple crises all the time, the lack of specific date became an issue.

Michigan Governor Jennifer Granholm, in a tight political race with her Republican challenger Richard DeVos, has said that the President’s failure to meet with the auto execs is emblematic of his indifference to the nation’s continuing loss of manufacturing jobs. DeVos also has said the President should have met with the auto executives sooner.

For all the furor, it’s not exactly clear what the President can do to boost the fortunes of GM, Ford, and Chrysler, which have struggled the past couple of years with a steady loss of market share and outmoded, inefficient product lines. The Bush administration has made an effort to finance more research on alternative energy and new vehicles. But the political power of the domestics has declined right along with their market share as Japanese and Korean automakers have built new factories and hired thousands of new American workers.

Karl Rove, Bush’s top political adviser, has confirmed the President will meet with the Detroit executives after Election Day.