Posted inUncategorized

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?

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Posted inPolitics: National

The Big Lie about unions

Somewhere over the past few decades, Americans became something new: followers. They became, as an earlier generation put it with disdain, "easily led." Keeping them that way requires a successful propaganda offensive in the case of the Big Three automakers. You see, it's all the union's fault. It's all the workers' faults. Just keep repeating that, over and over. Who knows what might happen if you failed to believe. Belief in the god "free markets" has been shaken by the incompetence of the Bush administration — and by the inevitable consequence of law-of-the-jungle capitalism: the worst economic calamity since the Great Depression. Who knows what might happen if working Americans were suddenly not so easily led.

They might follow the example of 240 workers at Republic Windows and Doors in Chicago, who staged a sit-in after Bank of America cut off credit to the company — and the company, in the way of today's America, laid off the workers without even a severance. They occupied the factory until the bosses and the bank capitulated. The action was hailed as a new sign of backbone, but there was a critical difference between these workers and most average Americans. A difference between them and the 35,000 employees that BofA itself is cutting. They were members of a union.

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Posted inUncategorized

Change? You can’t be serious

Let the excuses begin.

The New York Times leads off:

Just as the world seemed poised to combat global warming
more aggressively, the economic slump and plunging prices of coal and
oil are upending plans to wean businesses and consumers from fossil
fuel.

The Washington Post weighs in:

Many members of Congress believe they know what the car company of the future should look like. "A business model based on gas — a gas-guzzling past — is unacceptable," Sen. Charles E. Schumer (D-N.Y.)
said last week. "We need a business model based on cars of the future,
and we already know what that future is: the plug-in hybrid electric
car."

But the car company Schumer and other lawmakers envision
for the future could turn out to be a money-losing operation, not part
of a "sustainable U.S. auto industry" that President-elect Barack Obama and most members of Congress say they want to create.

That's
because car manufacturers still haven't figured out how to produce
hybrid and plug-in vehicles cheaply enough to make money on them.

Expect to hear more in the coming days and months. We will see a potentially debilitating alignment of old thinking and old, yet still politically powerful, economic interests. If it succeeds, the country will face much worse pain in the years ahead.

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Posted inUncategorized

Weekend myth busters

Heard the one about the $70-an-hour autoworker bringing down the Big Three? Read the truth in Jonathan Cohn's New Republic article. Another Big Lie from talk radio -- and I've…
1
Posted inUncategorized

Missing the point on a Detroit rescue

An industry that has been poorly managed, with executives looting it for huge bonuses and protected employees compensated far beyond the average American, making products that have caused untold damage to the planet, comes to Washington seeking a bailout. Without it, the executives say, the entire economy could be severely damaged. Of course lawmakers should say "hell no."

But they didn't. When the so-called financial services industry asked for a "rescue," lawmakers couldn't move fast enough.

American automakers are a different matter. Asking a fraction of what has been plowed into Wall Street — with not much to show for it — they are getting the brush off from the Bush administration and much of Congress. Myths proliferate about union compensation, this from the same people who hail obscene executive compensation and bonuses for the top swindlers on the Street. In fact, the union has been giving back for 20 years.

It's striking that the same people who celebrate the bootstrapping entrepreneur and the sanctity of contract are contemptuous of blue-collar workers who have created most of the wealth in a given business and painstakingly negotiated labor agreements that allowed their families to reach the middle class. And there's much carping about how the top executives failed to build cars for an expensive-energy future or to protect the environment. Yet policymakers consistently refused to insist on even modest improvements. Now it's so easy to say to Detroit: Drop dead.

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