Tuesday, October 18, 2005

One Man's View About How GM Lost The Third World Market

The government of the tiny ex-British colony of Barbados had a problem in the late 70's and decided to borrow some money from the twin brotherhood of state destruction; The World Bank and IMF - International Monetary Fund. That's right, the island had a problem of outpacing development; the city's sewer (or lack thereof) couldn't accomodate the drastic increase in tourists: cruise ships were coming at a furious rate; money was to be made and the government wanted to keep the gravy train flowing.

So, the government convinced the people that borrowing this huge sum of money was a good idea: while they were at it, they would rewire the island to take advantage of the upcoming telecommunications boom; and away they went, mortgaging the country to the tune of over a hundred million US dollars. That would be well over four hundred million US dollars in today dollars.

US $400,000,000.00.

Aside: As of 1997 one US dollar was equal to 27 cents from 1972; the last year American money had any real meaning. We have had eight more years of currency devaluation or if you prefer the politically correct term, inflation.

Anyhow, back to the story: The government of Barbados mortgaged its soul and whoever it could find to join at the hip and signed on the dotted line but the purse strings were being pulled before the ink was dry. Washington began leaning on the island to spend the money back into its borders; borrow from us, spend with us.

It was, for all manner of speaking, nothing but a nice little piggy bank for American businesses. No fault for the businesses; they were tied to the hip of Washington by something called lobbying. These big boys would use that big stick to get what they want and the name of the game is money, big money!

However, little old Barbados didn't want none of that crap. This little country really wanted to upgrade its sewage system but increasingly found itself being caught between a rock and a hard place by Washington.

What to do?

The Prime Minister, Rt. Hon. E. W. Barrow MP. Esq, at that time but now deceased was a sharp mongoose; he agreed to the idea of spending the back with American businesses on the stipulation that he got what he specifically asked for. The World Bank and IMF agreed to the terms of the loans and the prime minister promptly called upon General Motors to deliver a fleet of Cadillacs.

General Motors readily accepted. After all, this was a done deal; 36 cadillacs for cabinet level appointments for starters, plus more to come.

Man, what a sweetheart deal!

Until someone at GM headquarters read the fine print!

The Cadillacs were to be right hand driven and diesel powered!

Detroit Auto King refused to put the steering wheel on the right hand side of the car and their attempt at diesel is history.

The Japanese did; and the rest, as they say, is history...

Side Note: The island of Barbados paid a heavy price for that move but that story is for another time. I just wanted to concentrate on General Motors and their decision making powers.

What did they say about history?

Something like: Those who do not know it are destined to repeat it.

Or, something like that!


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