From an op-ed by Dan Ikenson of the Cato Institute:
When he urged Americans to "stop driving" their Toyotas last week, was Transportation Secretary Ray LaHood speaking as the head of a federal agency concerned with highway safety or as a sales advocate for a nationalized General Motors?
In testimony before the House Appropriations subcommittee on transportation last Wednesday, LaHood said: "My advice to anyone who owns one of these vehicles is stop driving it, and take it to the Toyota dealership because they believe they have the fix for it."
...
One important concern among auto industry analysts upon GM's emergence from bankruptcy has been whether and how the Obama administration might use regulation and the tax code to tilt the playing field in GM's favor.
Will consumers get special incentives to purchase high-mileage vehicles of the kind that -- surprise -- only Chevy Volt satisfies, for example?
Likewise, whether or not LaHood was exploiting an opportunity to reinforce doubts about Toyota and steer car buyers toward GM, there is no avoiding a conflict of interest when the government regulates an industry in which it has major stakes in one of the firms. One cannot objectively referee a race in which it has its own horse.
