The fall of GE

PenneyVanderbilt

The WeekThe Week

What happened to General Electric? For much of its 128-year history, GE was a quintessential American company. It produced the iconic incandescent bulb, the first commercial power station, the first commercial nuclear plant, the first American jet engine, and early advancements in plastics and silicon, just to name a few.

But today, the company’s market capitalization is plummeting, and it’s frantically selling off divisions for spare parts. It may eventually break up entirely.

The story of GE’s fall is one of bad luck, spectacularly bad decisions, and a very particular kind of elite American hubris.

It arguably begins with the arrival of the legendary Jack Welch as CEO in 1981.

Welch expanded GE beyond its familiar territories of manufacturing, engineering, and chemicals. He laid off workers and bought up new companies, including a 1986 purchase of RCA, which handed over NBC television. During this time, GE…

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