Howes: GM bankruptcy is epic fall

Growing up in Flint, Dee Allen remembers the day in 1958 when General Motors Corp. chose his hometown to celebrate its 50th anniversary. The giant automaker, America's symbol of post-war prosperity, then was approaching the zenith of its power and wealth.

Not today, 51 years later, as GM files for bankruptcy in New York and submits itself to the vagaries of government ownership, the rules of a federal court and the uncertain judgment of would-be American car and truck buyers.

Here in southeast Michigan -- home to the beleaguered automaker, its employees and thousands upon thousands of retirees, dealers and suppliers -- the immediate impact will be a punishing blow to a collective psyche that considered GM to be a timeless fact of life, an entitlement, even if it's now been proven to be neither.

"General Motors was everything," says Allen, 64, who retired from GM Friday, after 41 years in communications at the automaker. In Flint, "if you didn't work for GM, someone in your family did. Everybody -- everybody-- will feel the impact. In the mall, the people you see are not bouncing around. They're humbled.

"There are people who are mad, who are disgusted. There are people who don't know what's going on. They're very scared. Quite frankly, I think it's very difficult for people to realize how important GM -- and Ford and Chrysler -- are to these communities."

Enormously, to choose a single word. When President Obama and GM CEO Fritz Henderson today confirm that the General is spent, that its only hope for salvation and debatable redemption lies in the tempering fire of bankruptcy, they'll also be unveiling the supervised dismantling of a way of life built over five generations.

Eleven plants will be closed and another three facilities idled. More hourly jobs will be cut. More salaried jobs, perhaps as much as 30 percent of GM's non-union work force, will be eliminated. Excess plants, unwanted dealers and brands like Saturn, Saab, Hummer and Pontiac will be left behind and targeted for sale or liquidation.

The United Auto Workers, born of the Sit-Down Strikes in Flint and the Battle of the Overpass in Dearborn, is surrendering its equal-pay-for-equal-work mantra. Rollbacks in retiree health care benefits and the funding to keep them are imminent. The union, for the first time since World War II, is taking a step backward that it likely will never recover.

GM will lose operational control of its Adam Opel GmbH unit in Germany, acquired in 1929 and transformed into an important cog in GM's global engineering network. The Detroit automaker, the archetype for American industrial power in the "American Century," will lose its independence and the last vestiges of its swaggering, often arrogant, past.

"There is a lot of depression and resignation," a senior GM manager, deeply involved in the preparations for bankruptcy, told me. "A lot of people are working hard because they have a lot to get done by Monday.

"How did this happen?" he asked, knowing the answers but marveling at the reckoning nonetheless. "What was once the greatest industrial company in America is out of money. There's a certain element of shock. Monday, people are going to be walking around like zombies."

Not because they didn't know bankruptcy was as inevitable as it was imminent. They did. They track the internal metrics, read the business press, witness the grandstanding on Capitol Hill, skim the product reviews and troll the snarky blogs.

But because the filing marks a definitive end to nearly 101 years of GM history, an arc that mirrored the successes (the Arsenal of Democracy in World War II and the golden age of the 1960s) and failures (the oil shocks, shoddy quality, broken business models) of 20th century America.

Losing that is hard, however self-evident GM's troubles and however long the Great Restructuring has been coming. It's scary not knowing if promises for retirement made 30 years ago will survive bankruptcy, if communities like Flint, Detroit, and Warren and states like Michigan, Indiana and Ohio can absorb the shock -- and how effectively, and whether GM will, in fact, emerge.

GM's bankruptcy is a legal means designed to achieve a business end that is acceptable to ruling politicians, starting with the president of the United States. A "good GM" with a clean balance sheet, winnowed product portfolio, fewer employees and more manageable costs is expected to emerge by Labor Day, with a "bad GM" left in bankruptcy to be dismembered by associates of a Detroit-based restructuring whiz, Jay Alix.

It wasn't supposed to end this way. Janet Eckhoff, executive director for Chevrolet truck marketing before she retired in 2004 after more than 27 years at GM, says the automaker "had issues for a long time" but bankruptcy is "something that nobody ever would have expected."

Why? "It's sort of like God, taxes and GM -- they're always going to be with you. The emotional impact, once it happens, is going to be awful," she says, adding that her friends at GM are "totally exhausted" because they are "working their butts off" on assignments related to bankruptcy and restructuring.

Then she adds: "I do feel like I'm sort of at a wake."

Eckhoff's not alone. No doubt bankruptcy will be hailed as a new beginning for a new GM, as a government briefing paper said Sunday, but the simple truth is that it also is an end -- the final, sad marker of an epic American failure.

dchowes@detnews.com">dchowes@detnews.com (313) 222-2106 Daniel Howes' column typically runs Tuesdays, Thursdays and Fridays.