How Detroit committed suicide

In the garage of my condo tower, someone parks a 1965 Buick Electra 225 convertible. It is sleek and big and powerful. This was Detroit, and in many ways America, at the zenith of its power.

Buick, like all GM divisions, still enjoyed great autonomy, including having its own design bureau. This car is a work of art. It is the successor to the legendary Roadmaster, and in those days Buick fans were fiercely loyal (my mother being one). GM cars were tiered so people could move up to a new GM brand as they became more affluent, as millions did in the 1950s and 1960s — Chevy to Pontiac to Oldsmobile and even Cadillac. Ah, but the Buick was special: glamorous, racy, classy and exclusive. Built union.

I think of all this, of course, as Chrysler is pushed into bankruptcy and General Motors may well face the same fate. What went wrong, and what does it say about America's future?

As David Halberstam explained so well in his book, The Reckoning, the '60s saw the ascendancy of the bad practices that would do Detroit in: the rise of the bean counters, to the detriment of the "car guys"; arrogance, complacency and lack of vision on the part of both the management of the Big Three and the United Auto Workers. Quality began to suffer and the domestic automakers were totally unprepared for higher gasoline prices, the arrival of Japanese imports or changing public tastes.

Halberstam published his book in 1986. Chrysler had supposedly been resurrected by the alpha car guy, Lee Iacocca. GM began the first of many reinventions. The same with Ford. Over the next 20 years, hundreds of thousands of autoworkers lost their jobs and a larger magnitude of employees at parts suppliers were laid off. The unions repeatedly gave concessions on wages and benefits negotiated over the years. Factories were closed. Quality supposedly improved, and there were good years, on paper.

Yet Detroit continued, in the main, to build boring cars — there was nothing as artful and sexy as the freeway cruiser in my condo garage. The Buick Century of the late 1980s was a monument to banality and poor quality, indistinguishable from the other GM cars on that "platform." Detroit became addicted to the profits from SUVs and trucks — exempted from fuel economy standards. Yet this was an artifact of a period of unsustainably low gas prices. And when it came to an end, Detroit was once again totally unprepared.

Amazingly, many Americans continue to blame the unions, meaning, average American workers. I get this whenever I write on the subject in any venue (and I know right-wing groups actually pay people to comment with talking points on these issues). Or they find another set of scapegoats. Here is a priceless bit from a commenter to my Seattle Times blog:

Thank you for the page view, sir.

Back to reality. (I actually covered the auto industry) Although the Big Three slashed jobs, closed factories and cut off numerous American suppliers, and although productivity skyrocketed and profits were strong for several years, the money went to executive compensation and Wall Street's unsustainable profit demands. Put all this together and the results are not surprising. Toyota, the hybrid leader, pays its top executives less and is less a slave to institutional investors, investment bank games and short-term thinking.

The essential point is that all of Detroit's weaknesses were well-known in the late 1980s. The leadership of the Big Three, with few exceptions, abrogated their responsibilities and went for the short fix of SUVs, trucks and minivans. So why should we bail them out?

We shouldn't — if America still had a vibrant manufacturing base in the Midwest. But too many other things got away — think televisions, washers and dryers, computers and printers. The auto industry was always a huge backbone of the economy, with a vast supply train and sustaining good jobs. Now it's more critical than ever. The suppliers for Honda in Marysville, Ohio, won't offset the loss of Chrysler and GM. And those laid-off workers, whose families risk falling out of the middle class, are not going to become stem-cell researchers or write code for Nintendo.

Thus the Obama administration has little choice but to try. Unfortunately, the working people will take the brunt, whatever the president says about saving jobs. And, incrementalist that he is, Obama will not demand fundamental reform. I'm not even sure government can turn a hidebound GM into a Toyota or Honda. It could use part of the manufacturing base to retool to build transit and trains (GM did this with the old Frigidaire plant in Dayton in the 1980s, from appliances to light trucks). But this won't happen. Failure with these automakers will further jaundice generations of Americans who have no knowledge of what government can do well. The right-wing commentariat will not mention that Obama is cleaning up from the free-market looting and short-sightedness that the conservatives preach.

This Buick 225 was built for a different world. Gasoline was plentiful and America was about eight years from its national oil peak. The nation had 110 million fewer people than today — think about that — so in most places driving (and flying) was pleasant and seemed to be the future. We were killing off the best passenger rail system in the world.

We will have cars in our future. But the pressures against the 1965-era driving age, which persists today, will only increase: expensive oil, greenhouse pollution, worsening congestion. Americans will fight to keep driving in single-occupancy vehicle trips, keep expecting some miraculous hydrogen car to appear in their exurban driveway, hoping oil will be abundant once again, that global warming is a hoax. We can still manufacture something: magical thinking.