Posted on 07/05/2019 7:46:08 AM PDT by SeekAndFind
Few people who write for the news media — most of whom have only ever studied journalism or "mass communications" — know much about markets or entrepreneurship. Thus, it's not difficult to understand by people who are not entrepreneurs or capitalists get labeled at such in newspapers and on TV...
Few people who write for the news media — most of whom have only ever studied journalism or "mass communications" — know much about markets or entrepreneurship. Thus, it's not difficult to understand by people who are not entrepreneurs or capitalists get labeled at such in newspapers and on TV news shows.
When George Steinbrenner died, for example, he was hailed in the media as a great entrepreneur and capitalist. In reality, Steinbrenner was a con artist and a tax mooch. His "entrepreneurship" consisted mostly of fleecing working-class taxpayers to pay for his luxury stadiums.
And now, with the death of Lee Iacocca, we see a similar phenomenon. Within the many tribute articles about Iococca, he is commonly called the "savior" of the auto industry, or as Car and Driver describes him "the face of American capitalism."
In truth, it was the American taxpayer who "saved" Chrysler, not Iacooca. And thanks to Iacocca, the taxpayer did so against his will since Iacocca was an expert at leveraging the coercive power of government to make others pay for his corporate schemes.
Back in 1985, when Iacocca was being hailed as a capitalist extraordinaire, James Bovard, in typical Bovardian fashion, threw cold water on the nation's celebration of faux capitalism:
Iacocca is so popular largely because of his reputation for taking Chrysler from the brink of bankruptcy to the heights of profitability. But Chrysler is raking in the billions now not because it is making better cars, but because Iacocca and others persuaded Uncle Sam to prohibit Americans from buying more better-made Japanese autos.
Iacocca brags that the 1979 government bailout of Chrysler was a huge success, and even says federal loan guarantees are “as American as apple pie.” But since 1978, Chrysler has laid off more than a quarter of its workers and shut down 21 factories. A bailout intended to save jobs still resulted in tens of thousands of Chrysler workers losing their paychecks.
Iacocca even tried to cheat the government on the bailout deal. To cover the government’s risk in guaranteeing a $1.2 billion loan to a bankrupt corporation, Chrysler gave the Treasury Department warrants to buy 14 million shares of Chrysler stock at $14 a share. At the time of the bailout, Chrysler was trading at $7 a share; a few years later, thanks largely to the bailout and import quotas, Chrysler stock was up to $27 a share. When the Treasury announced it would cash in the warrants and collect a few hundred million dollars for taxpayers, Iacocca raised hell and tried to welch on the bargain. Iacocca whined, “That kind of profit is almost indecent….” Even though Chrysler has made billion thanks to government protection, Iacocca still tried to avoid paying Uncle Sam a single penny.
Iacocca wants the entire economy restricted, squeezed, and bled in order to benefit Chrysler. Iacocca tried to block the GM-Toyota joint effort to produce small cars in California, saying the partnership would be terrible for the auto industry. But at the same time Iacocca was doing his “Chicken Little” routine, Chrysler was already colluding with Mitsubishi, selling tens of thousands of their cars in the U.S.
Iacocca is America’s leading Jap-basher. Iacocca sweats that the Japanese “want to rape the market” and that “We’re a colony again, this time of Japan.” When Iacocca gave a speech on Dec. 7 on Japanese imports, he reminded his audience that it was a “day of infamy,” invoking Pearl Harbor and trying to stir up hatred for a valuable ally. Congressman Robert Matsui, D-Calif., derided recent Iacocca remarks as “racist.”
But it is understandable that Iacocca would seize every chance to slur Japan. Japanese car makers are still putting his company to shame.
Thanks to Iacocca, real American entrepreneurs — i.e., not welfare queens like the execs at Chrysler — had to pay much more for automobiles and auto parts, while paying taxes to bailout a huge corporation. Many also had to settle for lower-quality American cars.
But few seemed to care because then — as now — many Americans can't think through the implications of trade barriers and government bailouts. They don't notice the widespread unseen costs of protectionist trade barriers paid by consumers and entrepreneurs throughout the economy. All that really matters, in the minds of politicians and gullible taxpayers, is that Iacooca "saved Chrysler" and stuck it to those Japanese who think we're "lazy."
Of course, all that was before the 2008 financial crisis when it became the norm to bailout banks and auto companies, and when George W. Bush declared "I’ve abandoned free market principles to save the free market system."
Iacocca could have easily uttered those words himself. He was well versed in destroying competition, limiting choice, and sticking it to the taxpayer in the name of American big business.
There's no doubt Iacocca was a savvy businessman and a great lobbyist. But don't confuse what he was doing with entrepreneurship or capitalism.
If everybody is right is anyone wrong?
Earliest US example of “crony capitalism”.... the whiskey tax of 1791. While ostensibly to pay for the Revolutionary War debt, it was impossed in such a manner as to greatly benefit the large distillers on the coast at the expense of the small distillers on the frontier.
PS...guess who was the largest distiller of spirits in the US at the time.
“In truth, it was the American taxpayer who “saved” Chrysler, not Iacooca. And thanks to Iacocca, the taxpayer did so against his will since Iacocca was an expert at leveraging the coercive power of government to make others pay for his corporate schemes.”
Iococca’s big initiative at Chrysler was the K-car. Mechanically not much better than the junk that Chrysler was selling before he got there. Iococca managed to get direct loans, but more than that, just about every US government car in the fleet was a K-car. If it weren’t for the fleet sales, the K-car would only have been a modest success.
OTOH, the K-car platform was used to develop the Chrysler & Plymouth mini-vans. Those were wildly successful.
But even for all that Chrysler was no longer a complete car builder. Aside for the aenemic 4-cylinder engines, all the V6 engines at that time came from Mitsubishi. And bringing the Jeep brand under Chrysler also helped keep the wolf away from the door.
My turbocharged 4-cylinder GLH was far from anemic
The only Mopars I ever liked were built and driven by Sox & Martin.
Just a wild guess - was it a Kennedy? Maybe Joe Kennedy’s father or uncle?
Nah, seekandfind is just crying like a bitch because he misses “free trade” with China.
He does this every now and then but is even TOO MUCH of a bitch to respond to posts made.
Thanks for the history lesson, by the way. I had no idea that kind of crony corruption was seeping into the USA prior to 1800.
Iococca’s other big claim to fame was his *fathering* of the Mustang while at Ford. Even there his role was that of a con-man. The idea of a pony car was percolating around the auto industry for several year. In Philadelphia the Budd Company — which did body stampings for Ford & American motors — had built mockups for AMC & Ford. They called the Ford version the “X-Bird”.
A Ford delegation came thru to look at the “X-Bird”. Nothing happened initially. Ford hadn’t attempted a new, from-paper design since the Edsel and Henry Ford II wasn’t about to approve a new car model. A couple of years later Iococca basically told Ford what a new car would cost to design & tool, then cut that figure in half. Ford didn’t think he could do it, but the low-ball number got him to agree.
Essentially the ‘64 Mustang was a re-skinning of the Ford Falcon model, so essentially the “new model” was just a shell.
The base engine did not have a turbo-charger.
Lee Iacocca?
so?
My brother had base 4 cylinder Mustang. Wanna talk about an anemic piece of trash
“Have you read Lee Iacocca’s book?”
“Are you kidding? I own it! I haven’t, read it, but...”
Later, they made the minivan, based on the K-car.
Whatever. Not arguing your experience with an optioned engine package.
Initially, there were plans to use the British Ford V4 engine in the first Mustangs, but they went with the more familiar 170 cu in 6 as the base engine.
The Mini-Van was, in my opinion, Iococca’s crowning achievement. He basically created something entirely new. The Mustang-Pony Car concept was “out there” and I think would have happened elsewhere — by 1966 at least.
The in-line 6?
Remember the Falcon 260 Sprint ?
It was the Mustang before the Mustang appeared.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.