In 1953, at the peak of its dominance, the President of General Motors, Charles Wilson, declared before Congress that what was good for the country was good for General Motors and vice versa.  Rather a pompous statement as we it see it today, some 56 years later.

GM’s rise and fall and decline to insolvency parallel the rise and fall of Nations.  Pundits have said, “Overconfidence, hubris, lack of courage, foolish decisions made, and crucial decisions deferred have been the hallmarks of GM and the US.”

The GM stock is somewhere at $1.77, a 71 year low, it peaked at $100 in 2000.

However, this is not a story about GM; it is a story about the Auto Industry of Detroit, the economy and how it can be salvaged and the impact on multiple fronts.  And it’s an inside story from someone working within the industry today.  The source is impeccable, with credentials the likes of which are unquestionable, with decades of service.

For obvious reasons we are not going to reveal our source for this story.  But we will accurately quote the comments.

Perhaps it is important to set the stage for the inside perspective of an employee in this industry.  American carmakers have seen their market share drop from 85% in 1985 to 43% today.

GM’s market share peaked at almost 50% in the 1960′s.  It reached a historic low of 19.5% in January.  Their sales plummeted 49% from a year ago.  GM has too much debt, too much bureaucracy, too many plants, too many car lines, too many employees and too many future healthcare and pension obligations.

The only way a company can be in such a disastrous position is through decades of mismanagement.

The inside story with out the spin from DC or the Auto industry: “GM truly is on the brink, which is why they are creating their own news stories. They have always been ‘the big company with the big attitude’ looking down on others, intimidating suppliers, allowing condescending behavior to run rampant in their offices . . . they didn’t cut back fast enough, soon enough, and now they’re mired in a cultural shift as the cash drains away from them.  I personaly believe they will go into chapter 11, unless there is a bailout,”  . . . my source.

Top Republicans today said on Sunday morning talk shows that GM should go into bankruptcy and restructure.

However my inside source says “we’re all interconnected’ and such a ‘wakeup call’ would put many of suppliers out of business, which would intern hurt the suppliers and the suppliers of the suppliers.

“You see the dominoes are still standing, but they are all about to fall because we are all interconnected.”

“Chrysler is doomed, in my opinion.  There just isn’t room for three big domestic auto companies and while they have some neat styling for specialty vehicles, they haven’t had a true ‘cash cow’ for their company since the minivan in the 1980′s.  There’s a huge base cost to make cars and trucks, and you need at least one or two high-volume, lower-cost vehicles to support all the other flashy stuff.  They only have flashy stuff, and in the end they won’t make a go of it on that alone.  Their one brand that has any value is Jeep, as there are lots of Jeep enthusiasts out there.  Still, most people don’t buy a new Jeep as a primary vehicle, so they might be able to spin off of or sell that part of their company, but it’s not enough to support the rest of Chrysler.

“Ford is actually solid.  They are doing all the right things, have cut deep and secured lots of loans early, and if nothing else takes them down they will come out of this very well-positioned.  In the news this week, they announced they are using their cash to buy back some of their debt — basically paying off some of their loans.”

My source says Ford has always played it very conservatively, perhaps not a wise move in the times of a prosperous economy, but one that is faring them well today.

The American people drive a car as though it was a right of passage.  They turn on the key and always expect it to start, never thinking of all the parts that seem to make it work.  They want it to move forward and when it doesn’t they call triple A or some other towing service, and they are inconvenienced . . . never thinking of how complex the vehicle of today is compared to Ford’s Model T.

There are three words that are key in this essay provided to me by my Auto Industy source, ‘we’re all interconnected’ yes both in the auto industry and in life.

You see that in these times we have begun to realize that ‘we,’ yes the collective ‘we’, have spent money for more than a decade that we didn’t have.  That includes the auto industry, banking, the derivatives even Wall Street didn’t understand, and of course the concept that everyone should own their own house even if they couldn’t afford it.

And now we are entering a phase of personal economic responsibility . . . people are finally looking for better deals and everything is negotiable.

Oh, and by the way if you are waiting for the Government to send you a check, as Obama promised, you are going to wait for a long, long time.

Let us hope that Mr. Wilson’s prognostication was wrong: “As General Motors goes, so goes the nation.”