GM's Continuing Mistakes

I read with disbelief a headline in yesterday's Wall Street Journal, GM Is Seeking Partners for Car Loans.

Since selling off half of it's old GMAC unit, stuffed with subprime housing loans, GM has had to focus on actually making cars people want to buy.

The second paragraph of the article brought a chill to me. It read,

"The car maker has had trouble providing loans to more consumers, particularly those with weaker credit history, and views this as a barrier to winning back U.S. market share."

Have we, as a nation, and GM, as a company, learned nothing from the past few years of financial excess?

HOw is anyone well-served by GM seeking weaker, less capable borrowers to buy cars they cannot truly afford?

Sure, a car that can't be afforded doesn't represent quite the same amount of resources as an unaffordable house. But it's still a misallocation of societal resources.

Further, it's yet another clear example, after so many of the past few years, of a company deliberately pursuing marginal business which isn't sustainable.

This time, however, US taxpayers own this problem. Literally.

Not only is GM government-owned, so we own the losses that will come from this unsustainable strategy. We own the economic seeds of damage such a strategy is sowing. Spreading unaffordable cars throughout the country, creating bad loans and over-stretched consumers.

Have we learned nothing from the financial excesses of earlier this decade?

Evidently not.