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Can GM (Yes, GM) Save Us From $10 Gas?


Automaker to overhaul business, brand and dependence on oil.


Last Friday, which seems like a fortnight given the spiraling crush of the 24/7news cycle, one headline more than any other spoke volumes about the extent of our current economic malaise. With a spike in unemployment and a record run-up in oil sending the Dow careening, the most troubling report -- emanating not surprisingly from Capitol Hill -- got buried beneath a sagging wire: "After Verbal Fire, Senate Effectively Kills Climate Change Bill."

As reported by David M. Herszenhorn in The New York Times, the vanquished bill "would cap the production of heat-trapping gases and force polluters to buy permits to emit carbon dioxide. Critics [said] it would raise energy prices, including the cost of oil, at a time when Americans are struggling with record gasoline prices."

The merits of the Climate Change Bill aside, the real crisis we face is not of cash nor carbon, but of confidence. While a government handout can pad flat wallets and forestall foreclosures, $1,200 is a "stimulus" that's vanished by week's end. Left idling in its wake is a fatigued constituency that cries out for leadership that is apolitical - pioneers that are willing to eschew the focus groups to guide this fragile nation forward.

With Washington and Wall Street light on moxie, we turn westward -- as in times past -- in hopes of finding a spark. Not as far left as Silicon Valley, mind you. Instead, we joltingly discover a compelling model for an embryonic, yet brazen future emerging on the horizonless plains of the Rust Belt.

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There, in the birthplace of the automobile that's causing so much consternation right now, General Motors (GM) is placing a breathtaking bet that it can overhaul its business, its brand and our dependence on OPEC with a car that plugs into the wall. Hunkered down in cubicles, studios and conference rooms across Detroit – a city in need of its own rebirth -- are over 600 designers and engineers trying to make good on CEO Rick Wagoner's "moon shot," the Chevy Volt.

No matter how fudged the forecast or rosy the projection, there isn't a market analyst on this planet that would sanctify this level of investment in such a high stakes venture. And that's precisely the point. At such a mercurial juncture, when the body politic is just waiting for the the next shoe to drop, we need leaders that aren't afraid to draw -- and follow through on -- the improbable arc.

"Maybe what we are learning is to be more comfortable with a higher level of risk," noted Andrew Farah, the chief engineer for the Volt, in a statement that sums up the countercultural equation required to secure a sustainable way forward.

As chronicled in the July issue of The Atlantic, the leadership at GM is charting a bare knuckles course into an unprecedented fog of uncertainty. Not only do they have to engineer a lithium-ion battery that can travel 40 miles on a charge without overheating, they must learn to summon the creativity and ferocity that has been largely absent the last decade.

So, why not General Motors? As those on both sides of the aisle struggle to shoulder a humbling load, an icon from the first Industrial Age is long overdue. And this is precisely the courageous and timely tonic needed to stave off $10 gas and save a continent or two.

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No positions in stocks mentioned.

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