That quote was from engine charlie wilson but you got it wrong. What he really said was, "what's good for America is good for GM."
However, in other areas you are correct. GM has bowed to the UAW and allowed their cost structure to be out of control and they have produced a string of blah cars.
The other problem is that Michigan has failed to diversify their economy. This is mostly a government problem. I watch the state run the chemical industry out of Michigan in the late 70s and early 80s (mostly by attorney general frank kelly). Then in the 80s the state was hostile to expansion of agribusiness when they faiiled to permit several large oilseed process facilities. Michigan got pretty much what they wanted.