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An America without manufacturing becomes a starkly divided society

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WASHINGTON -- I'm often chided for my passionate support of the domestic automobile industry. But I don't mind the ribbing.

My passion is a product of my faith in America, my belief in its ability to compete and excel, to innovate, to lead.

There is something else -- gratitude ... and the desire to save an industry that put so many of my people on the road to prosperity.

I am a black child of the Deep South who watched legions of neighbors and relatives flee economic apartheid in pursuit of opportunity in the automobile factories of Michigan and Ohio and in the steel plants of Pennsylvania and Indiana.

Those black men and women often were assigned the dirtiest, most dangerous, least desirable jobs in those factories. But if whites happened to be working alongside them, they tended to be paid equally for the same tasks. There was hope for the future in that treatment, a quantum of dignity.

That hope and dignity eventually became codified in contracts between the car companies and the United Auto Workers union, as it did between other manufacturing entities and their labor organizations.

But, alas, hope and dignity were corrupted by greed on both sides -- on the part of unions that always wanted more, and on the part of domestic car companies, which became more interested in building Wall Street portfolios than they were in turning out cars and trucks of superior quality.

People make mistakes. But redemption is found in the good that they do, and the domestic automobile industry has done a lot of tangible good for this nation.

The American Three -- General Motors, Ford and Chrysler -- largely have been responsible for the development of a black middle class in this country. Many children of factory workers followed their parents onto automobile assembly lines. But many others went to colleges and universities, medical and technical schools, thanks to good UAW salaries and educational benefits.

Think about that:

People who left the South as field hands to become factory hands spawned generations of teachers, doctors, lawyers, technicians, engineers, inventors, designers, scientists, politicians -- and more than a few journalists. A country without a viable manufacturing infrastructure, a nation lacking a commitment to excellence and innovation in manufacturing could not have authored such progress.

But things now have gone sadly amiss; and we're all to blame because of our incessant push for more without sacrifice.

The unions demanded more pay and benefits but seldom petitioned for better product quality. Auto executives and their shareholders asked for more profits and productivity but often shied away from expensive innovations to avoid upsetting the moneychangers on Wall Street.

Consumers demanded safer, bigger, faster, higher-quality vehicles at lower prices. They evidenced concern for fuel economy only when they were forced to pay more for gasoline. Politicians kept a finger in the air, trying to determine which way the electoral winds were blowing, asking for more fuel economy when that seemed the popular thing to do but always promising their constituents continued access to the cheapest motor fuel in the developed world.

Foreign car companies globally went on the hunt for low-cost employees, often finding them in the Southern United States with the assistance of politicians and economic development officials offering tax breaks and union-free environments. One form of irrational exuberance led to another.

Things were bound to come crashing down. And now that the collapse has occurred in the form of economic recession, there is little sympathy for the domestic car companies, which are losing sales, market share, money and jobs. Federal rescue triage, it seems, dictates saving banks and mortgage firms first.

In a credit-driven economy, it is difficult to question the wisdom of the banks-first approach. But without a concomitant policy to assist and strengthen our nation's core manufacturing enterprises, it runs the risk of being short-sighted.

An America that manufactures nothing, or an America that owns nothing it manufactures, is an America with a frightfully vulnerable middle class -- an America that threatens to become a society starkly divided between haves and have-nots, a throwback to the Deep South of my segregated youth.

That is not the America I want.

Detroit News Autos Insider
 
What a story. I re-read this a number of times.

I agree that the auto industry created a middle class and I further agree that the problems that we find ourselves in are the product of labor and management. I have more faith in us as a people than I have in the incompetent elected officials that we (yes, me included) put into office. I know there's no right or wrong answer about GM bankruptcy but I slightly favor letting them do so. I understand that the bankruptcy credit market has dried up but good money follows quality so I tend to believe that whatever happens "on the other side" will result in a much more competitive company. Who knows, maybe the Corvette and Cadillac will no longer be part of the GM at that point.

There are no easy answers here and it pains me to think of the human toll that will result. I don't know what I would do but I would do everything that I could to keep my family together.

I thought long and hard about you point about manufacturing. I think I remember the following statistics correctly - 10% of every job in the US has some connection to the auto industry and before the global financial bust 20% of all jobs in the UK had some connection to the financial industry. The UK hit a recession before we did and I pretty much look at that as a lesson for us also - that there is vulnerability in having too much concentration in one industry. I know, if autos isn't the answer, then what is??

About the only thing that I can refer to is the growth of China and India. They used manufacturing as a stepping stone to leverage the growth of technology jobs in IT, pharmaceutical research, customer service. They made the transition in about one-fifth the time that we did (arguably) and they made the same mistakes that we did - polluted their world and sickened their citizens at the cost of progress, overbuilt capacity and believed the boom would never end.

I'm not sure that retaining manufacturing is the answer. I don't have any better ideas, I admit. Somehow, we have to implement a balance into our economy. Otherwise, we become Europe where government IS the main industry.
 
Chapter 11 would be the toughest and best-way for the Big 3 to go, most people today like the easy way which usually makes puzzy's of all involved and everyone eventually ends up in a very deep ditch.

It takes Great Leaders to make tough decisions! ;)

L8TR - D
 
Nor an america I want. I am however tired of hearing how mismanagement and the unions destroyed GM. First, GM built cars people wanted. When gas is a buck eighty a gallon america wanted big trucks , suvs and fast sports cars. GM could have built all the 80mpg golf carts in the world. WE WOULD NOT HAVE BOUGHT THEM. They gave us what we wanted. GM could have told us a gas crunch was comming 2 years ago and that we should buy these little cars, we would not have. Second, the government says they should have been tougher in their negotiations with the UAW.They are paid to much. The new president says "I don't care about millionaire CEOs, I care about the lives of the working people who made those guys rich". OK, then don't say GM gave the UAW to much.They paid them well and took good care of them(Just what the libs say companies don't do) You can't have it both ways. I am in favor of letting GM go the chapter 11 route. The will emerge from it healthy, though a lot of people will suffer, it will keep big brother out of the car biz. Believe me once Pelosi and her crew get the paws on the controls of the auto industry they will never let go. They will dictate what kind of cars GM will build based on some deranged sense of social and moral rightousness instead of what the market demands. Pelosi has already stated she wants to nationalize the oil companies, they already have the banking industry, now the car biz too. This is not the america I want to live in. Hell this sounds like the russia I don't want to live in.
 
Nor an america I want. I am however tired of hearing how mismanagement and the unions destroyed GM. First, GM built cars people wanted. When gas is a buck eighty a gallon america wanted big trucks , suvs and fast sports cars. GM could have built all the 80mpg golf carts in the world. WE WOULD NOT HAVE BOUGHT THEM. They gave us what we wanted. GM could have told us a gas crunch was comming 2 years ago and that we should buy these little cars, we would not have. Second, the government says they should have been tougher in their negotiations with the UAW.They are paid to much. The new president says "I don't care about millionaire CEOs, I care about the lives of the working people who made those guys rich". OK, then don't say GM gave the UAW to much.They paid them well and took good care of them(Just what the libs say companies don't do) You can't have it both ways. I am in favor of letting GM go the chapter 11 route. The will emerge from it healthy, though a lot of people will suffer, it will keep big brother out of the car biz. Believe me once Pelosi and her crew get the paws on the controls of the auto industry they will never let go. They will dictate what kind of cars GM will build based on some deranged sense of social and moral rightousness instead of what the market demands. Pelosi has already stated she wants to nationalize the oil companies, they already have the banking industry, now the car biz too. This is not the america I want to live in. Hell this sounds like the russia I don't want to live in.

I'm not sure that I agree with the view that Detroit built what "we" asked for. If they had a product that successfully competed with the imports, "me" and my family would not have permanently switched over to imports. Between the three of us, we've had 14 Lexus and 3 Hondas since our last American car, a Buick Somerset Regal that was a maintenance nightmare (BIG items like replacing the entire HVAC system on warranty). Our total maintenance costs for all the Jap iron, outside of routine maintenance, was one set of spark plug wires for the original Lexus GS that I owned.

For years, Detroit turned a blind eye to the imports and to the market that they symbolized. The imports are strongest on the coasts so it's pretty obvious that Detroit was mortgaging its future by relying on purchases from Middle America. Nothing wrong with that but it was, with the benefit of hindsight, the wrong strategy. The interrelationship between Detroit and selling to customers who had a vested interest in seeing Detroit succeed is broken and it will never come back.

Why the heck shouldn't we blame Detroit Management and the Unions - who else is to blame? It's NOT the consumers who let their hard earned money go to better quality products! You're telling me that you'll lionize people like Smith, Stempel, HFII and even people like Juergen Shremp (remember him?) in a time like this??? Let Wagoner, Nardelli and Mulaly beg on their knees, it's good for them.

Pelosi in control? Hell, I am no socialist but could she and the Obama Pretty Boys do any worse?
 
Talk about biting the hand that fed you, Ouch:

Romney, who was born in Detroit and whose father was an auto industry executive, wrote: “Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.”



Did we bail out Big Oil during the '70s? No.

Did we bail out IBM when distributed data processing caught them unawares? No.

Did we bail out Chrysler in the 70s? Yes, and look at where it got us.
 
I belong to Maine Mfg assoc. and I can tell you that when Maine decided that they didn't want Mfg in the state it was a fatal mistake.Tourisum and service industry will not drive an economy.Maine has become a socialist state because of this attitude.
 
I take the point about Maine and manufacturing but I'm not saying that the auto industry will disappear from Michigan. I'm saying that it will be substantially different and smaller.

If BMW, Honda, Toyota, Hyundai and now the Chicoms can make cars at a profit when assembled in the US, why can't the Big Three? I don't hear that the American workers who labor for the imports are living at or below the poverty line, either.

And now Barney Frank says that not bailing out the auto industry is just like union busting. Happy that you folks voted these rocket scientists into office?
 
I agree that the others will pick up the slack if the big 3 go down.And I agree that workers at Toyota are well fed .But the profit don't stay in the U.S .
 
Why the heck shouldn't we blame Detroit Management and the Unions - who else is to blame?

What about the US Government. I've been reading a little bit about CAFE Standards and the Two Fleet rule that requires a manufacturers’ domestic and import fleets to separately meet the CAFE standard.

Under this rule the auto manufacturers have to produce high mpg cars in the US to offset the low mpg cars. And the automakers make minimal, if any, profits on the high mpg cars produced in the US due to their high cost structure.

A mere tweak by Congress would help a lot -- simply allow Detroit to meet CAFE standards by counting the cars it makes at home and abroad. Never going to happen.
 
What about the US Government. I've been reading a little bit about CAFE Standards and the Two Fleet rule that requires a manufacturers’ domestic and import fleets to separately meet the CAFE standard.

Under this rule the auto manufacturers have to produce high mpg cars in the US to offset the low mpg cars. And the automakers make minimal, if any, profits on the high mpg cars produced in the US due to their high cost structure.

A mere tweak by Congress would help a lot -- simply allow Detroit to meet CAFE standards by counting the cars it makes at home and abroad. Never going to happen.

THIS IS A TEST : What was the last thing congress did right ?
 
Talk about biting the hand that fed you, Ouch:

Romney, who was born in Detroit and whose father was an auto industry executive, wrote: “Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.”



Did we bail out Big Oil during the '70s? No.

Did we bail out IBM when distributed data processing caught them unawares? No.

Did we bail out Chrysler in the 70s? Yes, and look at where it got us.
How about this question .Did GM bale out the US in WWII. Churchill said for 2 years the germans are building a huge army for a reason. The US gov did nothing to prepare for the ineviable. So we go to war unprepared, thank God GM (and others) stepped up and immediately switched over to designing and building aircraft and tanks. Time for a little payback?
 
I'm not sure that I agree with the view that Detroit built what "we" asked for. If they had a product that successfully competed with the imports, "me" and my family would not have permanently switched over to imports. Between the three of us, we've had 14 Lexus and 3 Hondas since our last American car, a Buick Somerset Regal that was a maintenance nightmare (BIG items like replacing the entire HVAC system on warranty). Our total maintenance costs for all the Jap iron, outside of routine maintenance, was one set of spark plug wires for the original Lexus GS that I owned.

For years, Detroit turned a blind eye to the imports and to the market that they symbolized. The imports are strongest on the coasts so it's pretty obvious that Detroit was mortgaging its future by relying on purchases from Middle America. Nothing wrong with that but it was, with the benefit of hindsight, the wrong strategy. The interrelationship between Detroit and selling to customers who had a vested interest in seeing Detroit succeed is broken and it will never come back.

Why the heck shouldn't we blame Detroit Management and the Unions - who else is to blame? It's NOT the consumers who let their hard earned money go to better quality products! You're telling me that you'll lionize people like Smith, Stempel, HFII and even people like Juergen Shremp (remember him?) in a time like this??? Let Wagoner, Nardelli and Mulaly beg on their knees, it's good for them.

Pelosi in control? Hell, I am no socialist but could she and the Obama Pretty Boys do any worse?
I don't mean to make this personal (OR MAYBE I DO) American car companies can not sell a car in Japan because the Japanese have a thing we seriously lack.It's called national loyalty. They support their own through thick and thin. Maybe if the people on the east and left coast had a little less self indulgence and selfishness and showed some national pride we wouldn't be having this conversation. I always buy AMERICAN no matter what, because I am not just buying a car I am supporting a lifestyle by supporting the US economy. My father died in WW11, you may have forgotten that epic struggle and that Japan tried for 3 years to destroy us, but I haven't. Without a manufacturing base you are a weak country. What are we going to do if China decides to get aggressive, Order some planes and tanks from Japan. Yah, right.
 
Chapter 11/Restructure...

Tough Love is Good: People learn to change instead of a breeding a freaking nation of U Owe Me's. ;squint:

L8TR - D
 
I don't mean to make this personal (OR MAYBE I DO) American car companies can not sell a car in Japan because the Japanese have a thing we seriously lack.It's called national loyalty. They support their own through thick and thin. Maybe if the people on the east and left coast had a little less self indulgence and selfishness and showed some national pride we wouldn't be having this conversation. I always buy AMERICAN no matter what, because I am not just buying a car I am supporting a lifestyle by supporting the US economy. My father died in WW11, you may have forgotten that epic struggle and that Japan tried for 3 years to destroy us, but I haven't. Without a manufacturing base you are a weak country. What are we going to do if China decides to get aggressive, Order some planes and tanks from Japan. Yah, right.



I regret that you lost your father in the war. Mine came back from the Atlantic Theater.

That being said, I understand the fact that some will never forget and will never buy a Japanese product. I respect that.

Ever heard of W. Edwards Demming? He's the American that our government sent to Japan as part of the program to rebuild their industrial base after WWII and he firmly established the concept of Statistical Process Control that the newbies call SixSigma. So, we rebuilt the enemy, they learned from their mistakes and we didn't. Now we got the shit kicked out of us and its time to see if we learn the correct lesson.

Screw the Japanese, everyone is worried about the Chicoms and Indians..even the Koreans are worried about them.

Not buying Japanese cars is politically correct but buying tools, cell phones, and wide screen TVs made in the PRC is politically correct?

Explain that to me.

Also, explain to me why buying Middle East oil, which has resulted in the largest transfer of wealth in the history of civilization, is politically correct when that money goes to support terrorists who murder innocents? Put in this broader context, maybe buying Japanese cars ain't so bad?
 

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