The Democrats want to bailout the Big 3 car companies with taxpayer dollars in order to keep the United Auto Workers union going, while the Republicans seem to want the firms to go into bankruptcy so a judge can rewrite their ruinous UAW contracts.
The funny thing is that white Republicans are a lot more likely to buy Detroit cars than are white Democrats.
The Detroit manufacturers' basic problem is that the kind of white people who voted for Obama will no way, no how buy cars built by UAW workers in the Detroit area. If SWPLs can't afford cars built by Japanese, German, or Swedish workers, then they will overwhelmingly prefer Japanese brand cars built by white hillbillies in places like Tennessee, Kentucky, and southern Ohio to anything built by UAW members anywhere near Detroit. (Blacks still buy Detroit cars, so this doesn't apply to them.)
So, the solution seems obvious. President-Elect Obama should use his vast network to get 10 million of his wildly enthusiastic white supporters to sign legally-binding contracts to buy, within the next three years, American-brand cars built by UAW workers. With that collateral, the Big 3 could then borrow enough money to get by.
Surely, the SWPLs would follow their leader in doing this, right?
My published articles are archived at iSteve.com -- Steve Sailer
In the name of fashion, millions of people walk around with their trousers hanging halfway down their bottom, which is not only ugly but uncomfortable. Spending tens of thousands on an ugly, uncomfortable car is a taller order, but not out of the question.
ReplyDeleteAll hail the Leader! Hail victory!
Tut, tut. According to those who rate cars, Detroit-made products compare favorably to their Japanese-made competitors. The UAW contracts are only seem ruinous to those who think working-class people ought to live in coolie conditions.
ReplyDeleteGreat post!
ReplyDeleteI agree with Steve that blacks are more likely to buy American cars than upwardly mobile whites ... but I must say that the brothers do love themselves Nissan Maximas with tinted windows, fancy rims, and loud stereos.
ReplyDeleteLately I've noticed that the brothers are now tricking out Ford Crown Vics and Mercury Gran Marquis', cars normally reserved for Grandpa. Maybe there is for the Big 3?
Dutch: Ford has good reliability. The others are so-so at best.
ReplyDeleteAs for the contracts, well, the writing is kind of on the wall, no?
Maybe we should exchange the awkward SWPL acronym for a more euphonious label like "swipple." It's easier to type (no ALL CAPS SHIFT) and it rolls off the tongue easier. It also conveys the sense of fey one-upsmanship implied in the term SWPL.
ReplyDeleteIn fact, the ultimate swipple-mobile is the Toyota Prius. It's #60 on the SWPL site.
ReplyDeleteSteve- as a car nut ( I own over 50 ) I don't think American cars are crap. They have come a VERY long way in the last 35 years, despite the best efforts of the Govt. to screw it up. In many cases they are as good or better than many European, and some Japanese, products. Try keeping a Volvo maintained and your credit rating intact- it ain't easy. Anyway- it's not a bad idea, but SWPL's are genetically incapable of seeing their own hypocrisies.....
ReplyDeletebah! I was enjoying that until I got to the last sentence. America build good cars.
ReplyDeleteRegarding Big 3 reputation, all I can say is I wish they would teach the value of reputation in business school. Because for too long the American carmakers allowed known defects to go out the door, simply because their spreadsheets told them it would be cheaper to fix them under warranty than to improve process. If they had assigned *any* weight to cost-to-reputation, I bet a lot of those would have been fixed the first time.
ReplyDeleteI hear a lot of people citing the initial quality reports and how GM has done well lately. If they keep it up for ten years, then they might actually change some perceptions and get people on the coasts to buy those cars. As it is, here in Seattle, I rarely see a U.S. made car. Some trucks though.
I agree with dwg that the American-made cars are now just as good as many of the Japanese or European made cars. They are also much cheaper to maintain than any of the European cars (except for Volkswagen)
ReplyDeleteThe big 3 car makers have been run into the ground by terrible management and the parasitical UAW and they deserve to become extinct for this. However, the cars themselves cannot be faulted on quality.
A minor clarification - the Honda plant is in central Ohio, just outside of Columbus. We're not all hillbillies here, but a large number of people do have Kentucky and West Virginia roots. You should see Interstate 71 on Labor Day weekend!
ReplyDeleteI live in Flint Mich., birthplace of GM. For years I heard the term "Generous Motors" when some local worker received a windfall (or, typically, a partial windfall). Having said that, it seem to me, a conservative, that the quality of GM vehicles has improved overall. A local mechanic told me, though, when I was having the wheel bearings replaced on my Buick Rendezvous, that he had ordered many sets of these bearings for this model and only one set in the past year for all Japanese models. For years GM said, "F%*$ you" whenever someone complained about some failed part that shouldn't have failed in the first place. Modern GM cars are better than older cars, true; but when it comes to gaskets, wheel bearings, AC condensors, antilock brakes, etc., GM decided to show contempt for the consumer rather than take a loss on the one transaction in order to build future goodwill. Their cars will roll for 300K miles with care (and not rust!); but it's $800 here and $1350 here and a new trannie over there in the mean time. Let the reader of this comment decide for himself what the proper sanction against GM would be.
ReplyDeleteHappily driving a Chrysler Pacifica.
ReplyDeleteI find it to be a fairly refined car and considerably cheaper than the nearest comparable Japanese or German offering (plus I can get 6.5 passengers in it).
Just bought my son a 10 year old Chrysler Cirrus/Dodge Stratus (seems like it has pretty good life left in it).
My other car is a honda which is a nice car to. The point is there is an incredible variety of viable automotive offerings out there.
I tend to be brand agnostic myself.
I don't know how common this is, but I learned it from my parents.
I'd like to hear your thoughts on the industry in general. It occurred to me while driving recently just how many different makes and models of cars (diversity, if you must) there are out there, and how that must be an unworkable business model nowadays due to increased design and manufacturing capabilities. As much as we like the variety to choose from, maybe there simply isn't room in the economy for all these different makes and models. The bailout seems to want to prolong the suffering of an industry that desperately needs restructuring and some natural selection, if not to one of the big 3, then some of their lines. Somewhere in Heaven, I hope Preston Tucker is cruising around in style.
ReplyDeleteThe Republicans are committing political suicide over this issue. Suddenly, they've become "free market" after supporting a $700 billion bailout for Wall Street and now refuse about 5% of that for a much larger, more middle class, and most importantly more middle American industry. And like Steve says, it's not because they hate American cars. If there are people buying American cars, it's not the progressive weenies. No, the Republicans just want to give a big "F*** You" to the UAW union. GOP leaders coming out with the most nasty, mean spirited language calling America's own car industry "dinosaurs" and looking downright happy that they might fail and millions might lose their jobs.
ReplyDeleteDamned idiots. The Democrats will rule Ohio, Indiana, Michigan, and Pennsylvania for 100 years, and with it, the country.
Again, I'm not questioning their right to make such an argument, just their hypocrisy. People have short memories, but they're not that short. Everyone knows that weasel GWB bailed out Wall Street to the tune of $700 billion. It's like Hugh Hefner going to public schools telling kids not to have pre-marital sex. Also, their rhetoric is so downright nasty.
Here in Ohio, there's a growing perception that the GOP is some kind of Southern, KKK, country music, NASCAR, hillbilly, redneck party. I've fought this perception hard. But seeing a whole slew of Southern Congressmen come on TV and go beyond just not supporting the loans, by mercilessly attacking the auto industry, and also attacking the people of Michigan and Ohio is too much to take. I voted for McCain and I feel real dirty if this is the payback I get from the GOP.
I honestly don't know if Nancy Pelosi and Harry Reid give a damn about the auto industry, but at least they're not on the TV day after day enthusiastically wishing for its demise.
GOP is attacking the bailout because the money (sadly) will be flushed down the rathole when the Big 3 fail anyway.
ReplyDeleteI own a Ford, I love my Crown Vic, it's big, relatively cheap, eats gas but everything else is a dream. Cheap luxury. Yeah it's a boat, I don't care.
Lots of Big 3 car owners don't want to be left in the lurch, but the problems with Ford, GM, and Chrylser are part of management and union leaders in a toxic cloud of stupidity. They are rent seeking instead of entrepreneurial, the GM Volt is a case in point, as is the failure of Ford to use the Crown Vic platform (prove rear-wheel drive superiority) to offer a bevy of cheap, reliable, affordable luxury cars with decent gas mileage.
Imagine a scaled down Crown Vic, same basic platform, a V-8 with on/off computer technology that shuts off half the cylinders in econo-mode, appropriate weight/power ratios (or a V6 perhaps) as a Toyota beater. That kind of car could have been launched ten years ago, but would have taken a risk-friendly "go for it" attitude that required partnership not screw-the-other-guy approach between workers and management.
Nothing is changing in the management, so the Big 3 will be a disaster.
If American cars are lousy and Republicans tend to own them, doesn't that mean Democrats are smarter than Republicans, at least car-buying wise (although it could mean Republicans are more mechanically-inclined and like to fix broken things).
ReplyDelete"American made car?" Is there such a thing any more?
ReplyDeleteThe vehicles the Big Three sells as "proudly made in America" are in fact cobbled together from almost entirely foreign components of dubious quality.
An engine is manufactured in China, its engine block cast of scrap metal from a nail factory and radioactive waste, its pistons and valves assembled by political prisoner slave laborers in a lao-gai deathcamp, with all the tender loving care, attention to detail, and quality control that implies.
It is attached to a transmission assembled in Guatemala by the most skilled nine-year-olds they can find willing to work for two cents a day, and stuck together with chewing gum that has been recycled by a patented process.
The powertrain is then attached to a chassis made of the finest recycled sheet metal by the most talented six-year-olds in a Brazilian sweatshop.
It is then shipped by train to one of the remaining plants in Deebabwe, where an assortment of sullen Wonderful Diversities drunk on Cisco Red are paid eighty bucks an hour to bolt on the wheels (hecho en Mexico) and affix the sticker that says "MADE WITH PRIDE IN THE USA." Shift's over, it's Miller Time, boys! There's your new 4-mile-to-the-gallon Monstermobile SUV, which is very economical because it can't go four miles without breaking down, and oh so practical in these days of $4.20 a gallon gasoline.
The whole circus is run by an assortment of fly-by-night CEOs whose job it is, when they're not demanding that the company spend more money on Wonderful-Diversity photo ops and heartwarming public celebrations of their commitment to Wonderful Diversity by hiring and promoting more and more disgusting sexual deviants and IQ-55 crackhead felons, to go weeping to Congress and the newspapers and declare Ford/Chrysler/GM much too PO', o lawd chillunz, we'z just too PO', to pay its employees' pensions as they are obligated by contract, y'all gots to give us another hunnert billion dollas, y'all. Then they jet back to Detroit to pick up their three hundred million dollar a year tax-free stock-option compensation packages, then when the taxpayer peons start to notice the familiar faces on the televitz too much, jump out the window with the aid of a cool half-billion-dollar golden parachute. Then the next nonentity with an MBA after his name takes over and there's another flurry of breathless newspaper headlines, HARD-NOSED NEW AUTO CEO PROMISES TO TURN DETROIT AROUND (gief moniez plox!).
I have no sympathy for any of the clowns in this particular three-ring circus of freaks and the best thing the US government could do would be to cut off the welfare checks and let Detroit die with dignity, then bulldoze the ruins of Detroit, plant some grass, and turn loose some buffalo. However, I am quite sure that the trillion-dollar bailout gravy train will keep on rolling until Washington runs out of money to write these welfare checks.
Here in Ohio, there's a growing perception that the GOP is some kind of Southern, KKK, country music, NASCAR, hillbilly, redneck party. I've fought this perception hard. But seeing a whole slew of Southern Congressmen come on TV and go beyond just not supporting the loans, by mercilessly attacking the auto industry, and also attacking the people of Michigan and Ohio is too much to take. I voted for McCain and I feel real dirty if this is the payback I get from the GOP.
ReplyDeleteMechanization and modernization destroyed the pastoral life of the South, leaving farmers and their families no other alternative but to work in textile mills. It wasn't long before the textile industry was wiped out due to competition from Asian sweatshops. An entire way of life was sacrificed at the alter of the free market. And now you expect sympathy because it's your region that will potentially be devastated?
Here in Washington DC you can stand on Connecticut Avenue or any of the main commuting routes for white Washington workers and count about one Detroit-built car out of every 100 cars that goes by.
ReplyDeleteI understand that Detroit quality has risen, but until the new UAW deal takes full effect (if then), it cost Detroit about $2000 more to build a same-quality sedan as it did the Japanese factories in the U.S. So Detroit made niche products, SUVs and pickups, and dumped its sedans on corporate fleets and rental-car companies, both high-volume but low- or no-margin markets.
SKT wrote:
ReplyDelete"The Republicans are committing political suicide over this issue. Suddenly, they've become "free market" after supporting a $700 billion bailout for Wall Street and now refuse about 5% of that for a much larger, more middle class, and most importantly more middle American industry"
SO TRUE people.
Good GRIEF guys!!!! Imagine how many of these people would never forgive the GOP for blocking this.
We give 700 BILLION to Wall Street, which doesn't directly employ very many people, but wont give 25 BILLION to the Big 3, which employ several hundred thousands of American people.
Dont wait for Obama to take the credit for this, and get himself re-elected in Ohio, Illinois, Indiana, Michigan, Wisconsin, and Pennsylvania on this ALONE!!!!!
Its vitally important that WE can manufacture the cars (hybrids, future electrics, trucks) that we will need for the future tailored for our particular market.
Just think of the million or so people who would be put OUT OF WORK if this got blocked and the Big 3 went out of business WHILE WE BAILED OUT AMERICAN EXPRESS CREDIT CARDS???!!!!!! Electorally that is suicidal folks. Obama will bail them out and have white factory workers in his pocket in the next election and win AGAIN.
25 Billion ain't much to keep the Big 3. Hell, 100 Billion ain't much to keep the Big 3. We gave Wall Street 7 TIMES AS MUCH. The Reagan Dems will never come back if we screw up here. Richard Shelby is in a state that has Merceded and Toyota (and I think BMW), thats why he is against it.
Skt is exactly right about the political ramifications of Republican opposition to loans for the auto industry.
ReplyDeleteAs for the quality of American cars, the initial quality surveys conducted by J D Power show that American cars are as good as anything the Japanese and Germans have to offer. Last year, that survey saw a Ford product get the number one ranking in five different product segments, more than any other company. And the award for the best plant in terms of overall quality worldwide went to a Ford plant in Michigan. This year, JD Power rated the Chevrolet Malibu as the best car in the mid-size car category, and the Pontiac Grand Prix as the best car in the large car category. Even Consumer Reports, long a fierce critic of Detroit (and the publication of an organization that was deemed subversive by the House Un-American Activities Committee) recently admitted that, with the exception of a few truck-based designs, “Ford’s reliability is now on par with good Japanese automakers.”
whiteRpeople is better thaan swipple.
ReplyDeleteI don't like SWPL because, unlike iSteve, I don't think the site or the book is that funny.
Glass half full: 'least iSteve isn't shoehorning this into track and field stat talk.
Glass half empty: iSteve hasn't explained why Mexicans love them Toyotas. Do they think Toyota is a Spanish word?
Steve: heh... it would be interesting to get the car ownership by brand stats for Obamaites. Doubt that many (or any) would go for detroit-made cars, regardless of actual build quality.
ReplyDeleteEven a bailout will only postpone the inevitable.. Maybe it is time to restructure the big 3?
maybe the southern politicians (reps and dems) are rational about this.. if the big 3 went down/or were restructured, wouldnt the southern states benefit by getting some of those jobs.
ReplyDeleteThe Repubicans were the majority party, but they threw it all away with stupid policies. Now that they're in a hole, their preferred strategy is to dig themselves in deeper. They aren't called the "Stupid Party" for nothing.
ReplyDeleteSteve, your perception of American cars as "crap" is way out of date. American cars are now as good as any Japanese or Euro models, and less expensive. But of course perceptions change more slowly than reality.
ReplyDeleteThe Republicans are committing political suicide over this issue.
ReplyDeleteI agree in part with what SKT said. The GOP needs to be very careful not to be seen as wishing for the demise of the auto industry. These aren't textiles - all the major auto producers are still in First World countries: Germany, Japan and Korea. America should still be able to compete in this industry.
That said the UAW workers are far worse than those evil Southern GOP senators. The sense I get is that they'd sooner watch the industry implode that admit that they're overly high costs are a major part of Detroit's problems.
Then again watching them all lose their jobs, pensions and health care might be worth the loss of the industry...
> President-Elect Obama should use his vast network to get 10 million of his wildly enthusiastic white supporters to sign legally-binding contracts to buy, within the next three years, American-brand cars built by UAW workers.
ReplyDeleteAlready suggested. By the Onion:
http://www.theonion.com/content/amvo/emanuel_calls_for_auto_industry
The Chevy Volt has the potential to be a real SWPL car. But it's asking a lot to expect people to buy something sight unseen from GM. And they aren't planning for a production run of 10 million.
ReplyDeleteWe know that the car industry can be successful in the US, since it is, at least outside of Detroit.
ReplyDeleteThe UAW and the Big Three are free to enter into any contract. However, they should suffer the consequences if that contract makes them uncompetitive.
"Isn't $25 billion a small price to pay to save the Big Three?" assumes that the problem is not structural but just temporary. It assumes that the loan won't just be good money after bad. The problem is that if $25 billion would transform the Big Three into profitable companies then investors would already be lining up to loan them the money. The fact that no one wants to invest in them indicates that their problems run deeper than a lack of capital. The problem is overcapacity and too many dealers, who have to offer incentives and sales that leave no profit for the dealer or the Big Three.
However, there is a rationale for the Big Three to be given an emergency loan from the government: much of their difficulty is directly do to CAFE standards and other onerous regulations.
The Republicans are committing political suicide over this issue.
ReplyDeleteBut this was inevitable when the financial sector was bailed out. If you're willing to spend $700B you don't have bailing out banks, exactly where can you possibly draw the line when every other industry (plus California and a whole lot of special interest groups) comes to you with hat in hand? You can't, at least not without looking like a mean-spirited hypocrite.
The Republicans have screwed themselves. They can no longer claim to be the party of limited government, so the only thing they have left is social conservatism. Yep, regional party time.
No, the Republicans just want to give a big "F*** You" to the UAW union... mercilessly attacking the auto industry, and also attacking the people of Michigan and Ohio... People have short memories... --SKT
ReplyDeleteSKT has the short memory-- Republicans in the House managed to stop the Wall St bailout the first time; a handful were bought off the second. Most supported neither... or both.
It wasn't all that long ago UAW members 'mercilessly attacked' American consumers for daring to think a Datsun was a better value than a Vega, Pinto or Gremlin: remember "Hungry? Eat your import!"? History's worst marketing campaign!
Dinosaur engineering? Of course not. But dinosaur marketing, definitely. Detroit's-- labor's and management's-- shoulder-chip "you-owe-us" attitude wore thin decades ago, and they still wonder why Americans feel little pity for them.
BTW, opposing the 1979 Chrysler bailout didn't seem to cost Ronald Reagan anything in 1980, unless you consider West Virginia the Rust Belt. And much of Michigan and Ohio's Democratic vote, both black and white, was in fact imported-- from the South.
Oh-- there are enough BTWs here to fill a BMW-- when will the UAW apologize for its consitent, if indirect, support for affirmative action, legal abortion, open borders, 'progressive' education, gun control and all the rest?
About the time Detroit takes responsibility for its own reputation...
"The GOP is in danger of becoming a regional party unless they stop pandering to rednecks and fundamentalists at the expense of everyone else."
ReplyDeleteWhich is the reason the party nominated a moderate. How did that work out?
Yeah,those UAW contracts are so ruinous. After all, the big 3 have to compete with notoriously union-averse places like Germany...
ReplyDeletePlease. What really holds the Big 3 back in this country (and notice - they have no problem competing with the imports in Europe and Asia, on their home turf) is the horrendously bloated dealer structure, supported by laws in every state that have made it virtually impossible to get rid of the 75-80% of dealerships they don't need.
But, no - it's gotta be the workers! Who do they think they are, thinking they deserve to have stuff like health benefits or pensions! The should be kept in locked dormitories, and taken out and shot when they turn 65, or get sick! Serves 'em right for not going to college!
If Republicans are so principled and so free market, why don't they lead a campaign to repeal the $700 billion bailout? Most of the money has not been spent. On the news, they said it was guaranteed that $350 billion of it would not even be spent until Obama comes into office. The bailout package has not stimulated the credit markets. Why not repeal it?
ReplyDeleteAgain, GOP hypocrisy is exposed. They are being penny wise and pound foolish in denying a much smaller loan package to America's greatest and most necessary manufacturing industry, when everyone knows that they passed a much bigger bailout package for Wall Street!
If the Big 3 declare bankruptcy and dump their pension obligations on the government, we will all end up paying far more than the $25-50 billion they are asking for. And that's the "good scenario". The bad one is if they go out of business, which will cost hundreds of billions in economic devastation: lost taxes, unemployment benefits, etc. The Big 3 need a bridge to 2010, which is when their UAW concessions start to kick in, and demographics start to favor the death of their many baby boomer retirees, which will cut their healthcare obligations.
For the Republicans, this time would have been most constructively spent by forcing additional concessions on the UAW and demanding a change in leadership at the Big 3.
skt is right, regardless how good or bad American cars are, or what the prospects are for the revival of the American automotive industry. In opposing a bailout for the big three, after having sanctioned a much more massive bailout for banks and insurance companies, the Republican party is sending a clear message to American workers: "F**k You!".
ReplyDeleteI heard Arlen Specter on the radio (he opposes the auto bailout) saying that he hadn't seen any kind of plan for how the money would be used. Funny, there was no kind of plan for the financial bailout, other than just giving the money to Paulson to use at his discretion, and yet that didn't seem to bother him then. Hypocrite.
At least Shelby has been more consistent, although probably not more principled - as another poster pointed out, Alabama is home to factories of several foreign car companies.
"Anonymous said...
The GOP is in danger of becoming a regional party unless they stop pandering to rednecks and fundamentalists at the expense of everyone else."
You may have a point about fundamentalists (inre the abortion issue), but not rednecks. The Republicans are showing themselves to be hostile to ordinary working guys. And I don't know any rednecks who want to import more mexicans, guatemalans, indians, and somalis into this country.
While I agree that Americam cars have gotten a lot better and are now generally more reliable than European models, I think they have a way to go to catch up with the Japanese.
ReplyDeleteHere's the results of the Consumers Reports Reliability Survey for 2007:
Most reliable
Vehicles listed in scoring order, starting with the best score.
SMALL CARS: Honda Fit*, Toyota Yaris*, Honda Civic Hybrid*, Toyota Corolla.
FAMILY CARS: Honda Accord Hybrid, Toyota Prius, Honda Accord (4-cyl.), Ford Fusion*, Mercury Milan*.
UPSCALE/LARGE CARS: Lexus ES350*, Lincoln Zephyr*, Hyundai Azera*, Acura TSX, Acura TL.
LUXURY CARS: Lexus LS (2006), Infiniti M*.
SPORTY CARS/
CONVERTIBLES/COUPES:
Lexus SC, Toyota Camry Solara (4-cyl.), Subaru Impreza WRX, Honda S2000, Mitsubishi Eclipse*, Mini Cooper Hatchback (2006).
WAGONS/MINIVANS: Pontiac Vibe, Scion xB, Toyota Matrix, Toyota Sienna.
SMALL SUVS: Toyota FJ Cruiser*, Honda Element, Honda CR-V (2006), Toyota RAV4*, Mitsubishi Outlander (2006)*, Subaru Forester .
MIDSIZED SUVS: Toyota Highlander Hybrid*, Toyota 4Runner, Toyota Highlander, Honda Pilot, Lexus RX400h (hybrid)*, Acura MDX (2006).
LARGE SUVS: Toyota Land Cruiser, Lexus LX, Toyota Sequoia, Chevrolet Tahoe*, GMC Yukon*.
PICKUP TRUCKS: Subaru Baja, Toyota Tundra, Toyota Tacoma, Nissan Frontier (V6).
Notice a trend?
I'm surprised that the Harley-Davidson story hasn't resurfaced. HD was going under, a banker took a small chance (under $4 million loan) and Reagan insituted temporary market protectionism, with tariffs for motorcycles based on displacement, which the Japanese worked around. Bingo- HD absolutely DOMINATES its' market segment. Free trade (or rather, unfair trade masquerading as free trade) is not always a panacea, nor do the Republicans have to suffer from abandoning it- I have never heard of any politician being attacked for helping harley Davidson.
ReplyDeleteThe GOP is in danger of becoming a regional party unless they stop pandering to rednecks and fundamentalists at the expense of everyone else.
ReplyDeleteThe GOP suffered everywhere. It suffered to a lesser degree in the South only because it has a larger natural lead.
While I make no apologies for the UAW, which would rather see GM and Ford dissappear than admit it's partly to blame for the problem, I do recognize the danger in having Sen. Richard Shelby (R-AL), in his thick Southern drawl, sit there and sound like he doesn't care if the Big Three go broke. That clip will get played over and over by Democrats in years to come. Remember that in politics perception counts for more than reality.
Which two American industries have suffered the most this decade? Automobiles and airlines. Which two American industries are most thoroughly union dominated (besides government)? Automobiles and airlines. ALPA and the UAW drive up costs in the good years and give back almost nothing in the bad ones. When contract talks come around the UAW has a policy of negotiating with the carmaker that is fiscally most solid then imposes those standards on the weaker two.
A bailout may be in order--- after bankruptcy. Before then its just buring money.
ReplyDeleteThe cars don't suck anymore. But, the labor wages are still too high, the marketing is lame and the debt burden overwhelming. Bankruptcy can fix 2 out of 3.
I'm surprised that Steve wants to save the company that came out with the Pontiac Azteck
ReplyDeleteThe great GM-Toyota canoe race!
ReplyDeletehttp://rense.com/general84/canoe.htm
John Kenneth Galbraith, in reviewing David Halberstam's book on the secession of automaking primacy by Detroit, says "Japanese trade unions, which initially showed signs of being unduly independent, were defeated and brought in a cooperative way into the larger fabric of Nissan."
ReplyDeleteI worked at the time as an advertising writer for Campbell-Ewald, the Chevrolet ad agency. I saw little evidence of corporate desire to bring workers into the fold during the dispute with the union at the Lordstown, Ohio plant (where the Chevy Vega was being built). Instead, the Chevy bosses were dismissive and hostile.
Yet the Chevy Vega was a terrific car -- one that was perfectly timed for the gas crisis of 1972. Why did management lack the will or imagination to lead the way in a settlement? Say what you want about union intransigence (and there was lots of that) the meetings I attended with executives made it clear there was no good outcome to be had. Settlement wasn't a serious pursuit. Per-unit profits on big Chevys were so much greater than those of the Vega.
To operate as Nissan had required Noblesse Oblige -- a concept that translated into Japanese better than American -- at least the American dialect the industry captains of Detroit understood. The bigshots couldn't see beyond the next quarterly P&L statement.
Although I had been working on Vega advertising, I was simply put back on the two-ton Impalas and Caprices. Such funny, featherweight sounding model names for the huge blocks of steel which are now, finally, becoming extinct.
"DWG said...
ReplyDeleteI'm surprised that the Harley-Davidson story hasn't resurfaced."
I'm not a motor-cycle guy, let alone a Harley-Davidson guy (that is to say, I'm not a badass, outlaw-biker Periodontist), but I have heard that Harley Davidson makes more money licensing their "Brand" for T-shirts, coffee-mugs, mouse-pads, etc, than they actually make selling their noisy, tricked-out crotch-rockets.
I read somewhere that the workers pension rights are the thing dragging the big US makes down.
ReplyDeleteSo money in the bank is guaranteed 100% but your pension isn't for a reason.
I also collect motorcycles- I have over 120. I personally think Harleys are the triumph of marketing over engineering- I basically don't think much of them. HD does make more money markteting crap to RUB's ( Rich Urban Bikers).You can buy the Honda-Davidson (Honda's American Classic) for about 2/3 of the price of the real deal, and it's a better machine. My point is not to defend HD, it's that protectionism didn't have a political price for Reagan.
ReplyDeleteRe: Fred Wickham & the Vega- the Vega suffered from the new alloy they made the blocks out of being incompatible with shade-tree mechanics not following directions, using the wrong anti-freeze caused major corrosion problems and overheating, leading to cylinder head issues which were very expensive- as well as body rust issues. I don't think the Vega was given much of a chance, and then its' reputation killed it. Much like the Corvair-which was a pretty good car by the time it was killed. Notice how Ralph Nader is absent from this debate? How strange- if you lived through the '60's Ralphie Boy was the go-to guy for GM bashing. Maybe it's all down the memory hole now...