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Opinion

High-flying U.S. car execs often crash when when they run into foreign laws

Mary Barra runs a global auto company that has fallen out of favor with both the American public and president. Barra runs General Motors and she argues that shutting down plants will prevent her from shutting down business.

Americans think of General Motors as an American company that boldly asserted that what’s good for GM is “good for the country.” Born of Detroit, built up during and after World War II and bailed out by President Obama with taxpayer cash. Its headquarters — and its heart — are in the United States. But its head is in China and other emerging global markets. In this time of impending trade wars and active geostrategic competition, this is a worrisome development.

Car execs operate with near impunity in America, but they are selling their souls to a China that is less accommodating. They are also selling out their workers and America’s economic advantage and technological edge in the process. If that’s not enough, brash auto executives may find that their leadership style and attitude doesn’t play as well overseas.

Ultimately, General Motors behaves just like any other seemingly stateless industry, moving capital and corporate executives around the global chess board, searching for better deals, tax breaks and car buyers wherever they happen to be. President Trump threatened Barra, saying she “better damn well open a new plant” in Ohio. But what he called his “damn tough” message for the GM leader are empty threats because American car companies are no longer American — just like German, French and Swedish car companies are no longer exclusively European.

Western car companies demand the protections of Western countries — the contract law, diplomatic strength, commercial power, taxpayer subsidies, friction-free markets and a chunk of available military contracts — but they operate outside national boundaries and beyond any Western nation’s control.

Auto execs act like borderless global cowboys. They act tough and play by their own rules. However, they may soon find out that the world is a dangerous place and that even a tough individualistic cowboy sometimes needs the protection of a Western sheriff.

Elon Musk is the latest car executive to capture dramatic headlines and challenge American authorities to a high-noon duel. Despite being South African by birth, Musk embodies the American outlaw spirit, playing fast and loose with the rules, betting the family farm with ballooning debt and knowing that being badass in the West means never having to say you’re sorry.

Musk was dinged for tweets and tokes, which tumbled his stock. And he still lands on the cover of Forbes. In fact, he continually mocks the U.S. government: “I want to be clear — I do not respect the SEC,” he told CBS’ Lesley Stahl, a state regulatory agency he once called the “Shortseller Enrichment Commission.”

Context is important, however. Musk’s zero-emission vehicle, the Tesla, is remarkable. His Space X company is out of this world. Musk’s antics be damned, the guy is a visionary who has already changed how we think about cars, satellites and even Mars. A little eccentricity and rule-breaking is exactly what Americans expect from a rocket man with big ideas. We revel in the man and the myth.

Musk is hardly the only bad boy of the industry. The American auto business has had its fair share of cavalier corporate chieftains. Before Musk built his dream car, John DeLorean, a former GM exec, founded a company that made the extraordinary car Marty McFly would take “Back to the Future.” DeLorean’s drug habit and cocaine’s high profit margins enticed him to smuggle $24 million worth of the white powder to save his business.

Outside of America, however, high-flying auto execs and the law do not always mix.

Earlier this week, Nissan Motors’ former CEO, chairman and turnaround artist, Carlos Ghosn, was sitting in a Japanese jail, accused of falsifying financial and compensation documents. Also this week, two former Ford executives were convicted of kidnapping and torturing auto plant workers in Argentina during that country’s dark recent past. This case put on display an American company’s executives buckling to a foreign government. Argentine prosecutors stated that Ford “acted in a coordinated manner with the military.”

The People’s Republic of China sits on the world’s biggest car market. China’s Geely has already purchased Sweden’s Volvo and stealthily acquired the largest single ownership share of Germany’s Mercedes-Benz manufacturer, Daimler. Tesla looks to China — where American car sales have skyrocketed — to develop its battery technology. Western car companies and their executives are willing to give up trade secrets and make technology transfers in exchange for access to a growing Chinese market. But what else are they willing to trade?

Western auto companies led by rule breakers represent Western prestige, but they are slowly being acquired or co-opted by a Chinese government that — despite coming changes — unfairly looks to dominate global markets in everything from solar panels to CRISPR babies to artificial intelligence to automobiles.

Iconoclastic auto executives may be revered in a liberal democratic West that exalts the radically individual genius. Authoritarian states and military regimes, however, are a lot less understanding of lone wolfs. Rule-bending Western executives may be broken — or arrested — if they do not closely follow the arbitrary laws of some of these stricter nations.

America and the West give high-flying, government-bashing auto executives free speech, hero status and a lot of legal leeway. Elsewhere, they are likely unsafe at any speed.

Markos Kounalakis, Ph.D., is a visiting fellow at the Hoover Institution and author of “Spin Wars & Spy Games: Global Media and Intelligence Gathering.”

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