Late yesterday, Automative News reported that Jerome York -- a consultant to Kirk Kerkorian's Tracinda Corporation -- will take a seat on GM's board of directors. We have seen this before, when Kerkorian invested in Chrysler prior to its merger with Daimler Benz. The market is intrigued by the prospect of York's intervention, and shares for GM rose dramatically in late-day trading.

Today, the W$J is reporting that York and Kerkorian may attempt to exert influence from the outside. What do they want to do? Speculation is that they want to force Rick Wagoner to accelerate his restructuring program.

Maybe the market is right about Kerkorian and York, but this is a different situation than Chrysler. In that case, Kerkorian was attempting to move a management team that was sitting on a cash stockpile. Chrysler was doing well, but Kerkorian thought they could do better. In the case of GM, the company has been languishing, and management is already on the move. One analyst is quoted in the W$J as saying that GM's management needs a "sense of urgency," but is this plausible? Does GM's management really need additional motivatation to turn things around?

To me this looks like a question of strategic judgment, not incentives. If I am right about that, then the issue is whether investors should embrace Kerkorian's (or York's) judgment over Wagoner's. Wagoner inherited a company with serious problems, and I have seen no evidence that Kerkorian or York would be better equipped to deal with those problems than Wagoner.

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