Posted on 11/21/2008 6:08:15 AM PST by Kaslin
Who killed the U.S. auto industry?
To hear the media tell it, arrogant corporate chiefs failed to foresee the demand for small, fuel-efficient cars and made gas-guzzling road-hog SUVs no one wanted, while the clever, far-sighted Japanese, Germans and Koreans prepared and built for the future.
I dissent. What killed Detroit was Washington, the government of the United States, politicians, journalists and muckrakers who have long harbored a deep animus against the manufacturing class that ran the smokestack industries that won World War II.
As far back as the 1950s, an intellectual elite that produces mostly methane had its knives out for the auto industry of which Ike's treasury secretary, ex-GM chief Charles Wilson, had boasted, "What's good for America is good for General Motors, and vice versa."
"Engine Charlie" was relentlessly mocked, even in Al Capp's L'il Abner cartoon strip, where a bloviating "General Bullmoose" had as his motto, "What's good for Bullmoose is good for America!"
How did Big Government do in the U.S. auto industry?
Washington imposed a minimum wage higher than the average wage in war-devastated Germany and Japan. The Feds ordered that U.S. plants be made the healthiest and safest worksites in the world, creating OSHA to see to it. It enacted civil rights laws to ensure the labor force reflected our diversity. Environmental laws came next, to ensure U.S. factories became the most pollution-free on earth.
It then clamped fuel efficiency standards on the entire U.S. car fleet.
Next, Washington imposed a corporate tax rate of 35 percent, raking off another 15 percent of autoworkers' wages in Social Security payroll taxes
State governments imposed income and sales taxes, and local governments property taxes to subsidize services and schools.
The United Auto Workers struck repeatedly to win the highest wages and most generous benefits on earth -- vacations, holidays, work breaks, health care, pensions -- for workers and their families, and retirees.
Now there is nothing wrong with making U.S. plants the cleanest and safest on earth or having U.S. autoworkers the highest-paid wage earners.
That is the dream, what we all wanted for America.
And under the 14th Amendment, GM, Ford and Chrysler had to obey the same U.S. laws and pay at the same tax rates. Outside the United States, however, there was and is no equality of standards or taxes.
Thus when America was thrust into the Global Economy, GM and Ford had to compete with cars made overseas in factories in postwar Japan and Germany, then Korea, where health and safety standards were much lower, wages were a fraction of those paid U.S. workers, and taxes were and are often forgiven on exports to the United States.
All three nations built "export-driven" economies.
The Beetle and early Japanese imports were made in factories where wages were far beneath U.S. wages and working conditions would have gotten U.S. auto executives sent to prison.
The competition was manifestly unfair, like forcing Secretariat to carry 100 pounds in his saddlebags in the Derby.
Japan, China and South Korea do not believe in free trade as we understand it. To us, they are our "trading partners." To them, the relationship is not like that of Evans & Novak or Fred Astaire and Ginger Rogers. It is not even like the Redskins and Cowboys. For the Cowboys only want to defeat the Redskins. They do not want to put their franchise out of business and end the competition -- as the Japanese did to our TV industry by dumping Sonys here until they killed it.
While we think the Global Economy is about what is best for the consumer, they think about what is best for the nation.
Like Alexander Hamilton, they understand that manufacturing is the key to national power. And they manipulate currencies, grant tax rebates to their exporters and thieve our technology to win. Last year, as trade expert Bill Hawkins writes, South Korea exported 700,000 cars to us, while importing 5,000 cars from us.
That's Asia's idea of free trade.
How has this Global Economy profited or prospered America?
In the 1950s, we made all our own toys, clothes, shoes, bikes, furniture, motorcycles, cars, cameras, telephones, TVs, etc. You name it. We made it.
Are we better off now that these things are made by foreigners? Are we better off now that we have ceased to be self-sufficient? Are we better off now that the real wages of our workers and median income of our families no longer grow as they once did? Are we better off now that manufacturing, for the first time in U.S. history, employs fewer workers than government?
We no longer build commercial ships. We have but one airplane company, and it outsources. China produces our computers. And if GM goes Chapter 11, America will soon be out of the auto business.
Our politicians and pundits may not understand what is going on. Historians will have no problem explaining the decline and fall of the Americans.
Actually, the profit goes home; it does not count the same as say Ford say. The cars are assembled in this country...not truly manufactured-quite different. It won’t matter, they will leave this country anyway.
As for the service economy. If Americans continue to believe in the global service economy, then they are idiots.
This model is not good for a country like ours... we have so many resources in this country, we do not need to settle for crumbs from abroad. I say let’s make policies that benefit this country. Thanks to this worthless model, we are bankrupt. It’s time to innovate and find a new way to help America remain a great power.
Nathan Detroit is dead? Damn!
Well, the former (late) Mayor Coleman Young had a lot to do with the destruction of Detroit - and no one even mentions this...interesting.
Detroit killed Detroit.
Detroit killed Michigan with the help of Lansing.
It's not that simple. Some of the profit is expatriated, but another portion is used to invest in new facilities and operations in the US. Likewise, Ford (if it did have any profits) does not keep all of its US profits here- some of it is used to finance expansion of operations in other countries. These companies are transnational, and their money moves where it is most needed.
As for the service economy. If Americans continue to believe in the global service economy, then they are idiots.
Name one advanced indsutrial economy where manufacturing is the main part of the economy.
to this worthless model, we are bankrupt.
Our current economic woes are mostly due to idiotic government policies, not the natural shift to a service economy.
Unions and socialism killed Detroit !!!!
I would go farther than that. They need picayunish restrictions and requirements to be repealed....including those regarding labor.
Back to subject: Bailout
The Bailout Boys
An animated video featuring U.S. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke as Butch Cassidy and the Sundance Kid. By John Kenney and Pete Slife. NewYorker November 18, 2008
Chevy and Ford still make good cars that people want and will buy over and over again. Might not be my taste or yours style wise; but still there are Millions of Americans and customers overseas who buy American. The Malibu has always excelled in providing forward thinking gas mileage savings. Ford is selling plenty of their little European versions overseas (for tight roadways, not good for super highways). All have been in the "mass rental car" market".
New James Bond movie out has Fords throughout the scenes. James Bond makes Ford cool again?
All in the Marketing!
GM has just become the "battle ground" like when Iraq was chosen to be the "battle ground" on the war on terrorism. Who will become the victor of the spoils? Workers don't really matter, there has to be casualities in any war for the better or good of the Whole of society, long said government and grass roots activists of any agenda.
Does government not have any mirrors?
Tis said: Blood sucking Vampires have no reflection!
Talking about Blood via the Huffington Post :
| "When people start to starve and when municipalities can no longer afford to staff police departments those distant mobs with pitchforks will be coming to your house for dinner -- guess who"s coming to dinner - an angry, disillusioned, hungry mob. If you are poor already, then the potential slide into mayhem will barely register on your existence meter, for all you have ever known is struggle and making something out of nothing. If you are rich and have a heart the mob will know, and like the lambs" blood on the door, there will methods to insure pass over. The greedy (those known and not known) had better get ready, for if things do not change and change in a hurry, their will be mayhem all across the world and revolution will come down on the neck of the greedy with both feet....." |
Of course: The Greedy can be "blindly seen" as "any one or collective ones with money" saved, inherited, earned the old fashioned way through toil and hard work, built from the casting of bricks and mortar one at a time into the Golden Arches of Success.
Billy Graham in his book THE SEVEN DEADLY SINS says, Greed has two cousins. The first is COVETOUSNESS...THE DESIRE TO HAVE WHAT OTHERS POSSESS.
We see the ELEGANT HOME that a friend has purchased, and IN OUR HEARTS we want to own the same or BETTER.
Our neighbor has a new car and we want one like it or better...
We see that Co-worker who accumulated alot of money and we wish we had his bank account.
The Second sin that accompanies GREED is ENVY.
If Covetousness means that I want what others have, envy means that I RESENT THE BLESSINGS OR GOOD FORTUNE OTHERS HAVE RECEIVED....Because I wish the good fortune could have been MINE...and actually leads to a dislike for a person who has what I want...
The sins of Greed and covetousness never walk alone....we all know the list of sins that can come from this...when somebody else has something I want..... "
Good luck!
You hit the nail on the head: I don’t think that many people do take the time to read the whole article. Just jump down to the comments and start opining.
I read Pat’s well-argued column to say it’s all of the above: UAW, bad management, and Government intrusion into the market.
Every opinion writer has rightly commented to death about the UAW component.
Pat’s unique contribution to the discussion is to also spotlight the government overregulation. Same as the mortgage meltdown: it was government meddling and forcing banks to do bad business the caused the meltdown. Pat’s argument is that it contributed significantly to Detroit’s meltdown too.
It’s an important argument. If we can’t diagnose the problem right, how is a fix going to happen?
Any union worth it's salt will fight this all the way, even though it's what's needed. A large segment of the Rat party is owned by the unions, but the greens are in control so we will see.
If the current management of the big 3 had any courage they would stop looking for bailouts and sit down with the union. If the union won't capitulate then go to bankruptcy.
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