What's good for GM? Nothing, apparently Attytood

It's getting to be an old headline, but today -- over $56 a barrel (yes, yes, we know, it was higher when adjusted for inflation in 1980...but, still). It's likely to get worse. It seems like people are finally getting their arms around the idea that OPEC has no extra oil to spare.

Remarkably, the American economy has not panicked over the somewhat alarming trends. Until recently, the stock market has slowly meandered higher, and the jobs numbers -- while nothing like the peak under Clinton in the late 1990s -- have been better than any time since the very start of the decade.

But that's all starting to change, as of Wednesday morning. General Motors announced its financial outlook for 2005, and the numbers were downright ugly. The giant automaker had once been expecting to break even in the first three months of the year, but now it will likely lose $1.50 a share. GM once thought it would earn $4-5 a share this year, now that's down to $1-2.

The stock (one of the 30 that make up the Dow) is getting hammered today, down a whopping 13 percent as we write this, and it's taking the Dow down South with it.

Why is this happening? Basically, it's because GM builds cars that run on oil.
The GM news release has a great piece of corporate speak, noting that one of the problems at the company is "a more car-based sales mix." In English: Good ol' all-American cars, bad; gas-guzzling SUVs good -- for GM, anyway.

The SUV segment lost 1.2 percentage points of U.S. market share over the last two months and large pickups were down about 2 percentage points, according to Edmunds.com, which tracks the industry. Fuel-efficient compact cars, on the other hand, gained 2.2 percentage points of market share in the same period.

That's great news for the environment and for global warming prevention. And, if Detriot had been more on the ball, it might have been OK news for GM. But it's not -- instead it's a disaster for the world's biggest automaker. Why? Because an astounding 80 percent of its profits come from SUVs and pick-up trucks. (Didn't this already happen in the 1970s?...it's like re-living a bad dream.)

This is just the beginning...sadly. How long will Washington -- and we're talking both Republicans and Democrats here -- continue to fiddle while Rome, i.e., the world oil-based economy, continues to burn like a Kuwaiti oil well circa 1991? The 2004 election would have been a great time to talk about a sensible strategy to wean America off fossil fuels to the greatest degree that's possible.

But that didn't happen. Today, it's GM paying the price.

But tomorrow, it's going to be our now-10-year-old son and 12-year-old daughter.
UPDATE: OPEC fesses up -- we don't got no stinkin' oil. (Assist: Atrios)