Wednesday, February 17, 2010

GM Stake Compromises Obama in Toyota's Recalls

Official portrait of United States Secretary o...

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by Daniel J. Ikenson

When he urged Americans to "stop driving" their Toyotas last week, was Transportation Secretary Ray LaHood speaking as the head of a federal agency concerned with highway safety or as a sales advocate for a nationalized General Motors?

In testimony before the House Appropriations subcommittee on transportation last Wednesday, LaHood said: "My advice to anyone who owns one of these vehicles is stop driving it, and take it to the Toyota dealership because they believe they have the fix for it."

Later that day, LaHood tried to clarify his remark, adding that the National Highway Traffic Safety Administration "will continue to hold Toyota's feet to the fire to make sure that they are doing everything they have promised to make their vehicles safe. We will continue to investigate all possible causes of these safety issues."

Certainly, Toyota's faulty accelerators and brakes are legitimate safety issues, as are many of the other 2,000 recalls a year logged by the NHTSA. However, La Hood's remarks, implying that Toyotas are unsafe to drive and that company leaders have been evasive about the problems, should raise some eyebrows.

After all, the Obama administration bought a 60 percent stake in General Motors costing taxpayers more than $50 billion and is thus vested politically in the company's success. That GM's value must exceed at least $83 billion (bearing in mind that the company's highest-ever market valuation was $60 billion in 2000) before taxpayers can be made whole is the prism through which the administration's words and actions on the auto industry should be viewed.

GM Stake Compromises Obama in Toyota's Recalls

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