Saturday, April 24, 2010

GM Commercial: Is this a Lie?

Here is an interesting philosophical question for you. Is this commercial a) misleading, b) deceptive, or c) a bare-faced lie? I'm wavering between b and c.

In it, the CEO of General Motors argues that the massive TARP loans made to them last year by the Obama administration (with money dedicated by congress to bailing out banks, not car companies) were not such bad idea after all, given that they have now paid them back, in full, with interest, and five years early. When I heard that, I thought what millions of others thought. GM must have made a miraculous recovery and paid the taxpayers back with money they had earned from their customers. CBS news described the White House as "exulting" in the fabulous news. And no wonder!

Except that this is not what happened at all. As revealed in testimony before the Senate Finance Committee the day after all the exulting began, what GM had actually done was to take billions from another fund of taxpayer money, held in escrow for GM by the Treasury Department, and simply transfer it to another account. This was explained yesterday in a well-reasoned, gentlemanly letter Sen. Charles Grassley (R-IA) sent to Treasury Secretary Geithner. (His letter has for some reason disappeared from the senator's web site, but you can read the full text in this blog post.)

It's possible to deceive people by means other than lying. To lie, you must make a statement that is false. This man, and the exultant administration, are lying if you judge that what GM did doesn't not count as a "repayment." After all, if the taxpayers were payed by in effect taking even more money from them, they are no more solvent than they were before. In fact, the wording of Grassley's letter suggests that the money in the escrow account is loot GM has no legal obligation to ever give back to the taxpayers, so what they are doing sounds more like a default than a repayment.

On the other hand, you might decide that, by state decree, the money in that escrow account is legitimately the property of GM, so that they really are repaying the taxpayers, though with money that used to belong to them.

However, as I've said, it is possible to deceive people without overt lying. You are being deceptive if you make a statement on the basis of which a reasonable alert, reasonably trusting audience will believe something that is false. I and millions of others did believe something false on the basis of this ad. You are dishonest if you are deceptive in a way that is morally wrong. Your deception is morally wrong if you are doing it in order to gain at the expense of the deceived person.

It seems to me that, by these definitions, this ad and the exultant administration spokespersons are being both deceptive and dishonest. Not only are they being deceptive but if we remain deceived about this goofy shell game then in the long run they gain and we lose.

By the way, I love the title of this commercial: "Trust."

(Developing: Go here and scroll to 2:18, and you can see Obama earlier today repeating GM's lie, or whatever it was, word for word. For an account of the real reason GM paid the $6.7 billion loan now rather than later, look at this. No, it's not a nice reason.)

1 comment:

Todd said...

Our auto industry and most consumers don't understand China will be moving into this space in a huge way. See Chery automotive, and others. In five years they will utterly destroy the US manufactures and dealers.