Saturday, November 29, 2008
Looking Back to the Future
Yes, want to see the future, the new domestic energy sector being proposed as a job-creation measure? It will never work! I mean, that's Jetsons-type stuff, right? (Jack Nicholson, in that video, warning, makes a joke that some Iowans may find offensive or insensitive in light of recent tragedies, but this is still a video worth watching.)
Imagine if GM had pumped out a whole line of these babies in 1980 before Japanese subcompacts came in to steal the show. If we are to believe that unfettered capitalism favors growth of GDP and will find its way to break all binds--that's Marx's definition of it, and short of Milton Friedman there's no bigger free-trader than Marx--then wouldn't these cars, if they were built, have led to Hydrogen sector having developed on its own?
I read something recently that was an interesting idea, a fine capitalist idea, to prevent the elimination of so many American jobs:
ExxonMobil or BP ought to bailout the big three. One good turn deserves another. Do you think Toyota or Honda is going to be so sentimental and weepy when it comes to the internal combustion engine?
I distrust Oil conspiracies as a general rule, and enjoy reading them for fun. (Try Armageddon, Oil, and the Middle East for uncomfortable giggles--if you live in Iowa City, sometimes folks pass this book out in the ped mall, and it's as ludicrous as it is prescient as it is paranoid.)
It is helpful, however, to think about the extent to which America is a capitalist nation anymore. It seems that the Asian tiger economies are the real drivers of the world market, responding to conditions and needs before and as they arise. I don't know if I like being one of those people who considers the past forty years "corporate socialism," but the fact remains, we're an out of date country!
Taking away UAW workers' pensions and retirement medical benefits (that they've already earned) isn't going to catch us up to the world economy. The same folks who rail about the importance of "property rights" are the Chicken Littles crying about how some assembly line retiree shouldn't really be allowed to keep what his contract said he was going to get. Toyota doesn't make its money by screwing its workers and setting up in sweatshops. It doesn't make its money by building crappy cars with exploding gas tanks and taking actuarial gambles ala the Pinto memo. Toyota builds quality cars, anticipates market conditions as they will be, and steps out on the forefront without struggling on a limb. Toyota creates American jobs and doesn't go crying for bailouts.
You know what would cut down on the Big Three's labor costs? Stop laying so many people off. Do you know how much money it costs to keep laying off, paying severance to, and then rehiring the same small pool of workers?
Mitt Romney had a couple of good points about the American auto industry being bloated, even if he couldn't resist pegging it on those greedy little bastards who used to work on the assembly lines and insist on collecting "pensions" that the companies "agreed to" in the "past". But as far as being bloated went, Henry Ford had the right idea with the simplicity of his branding, and Ford today does too--that's why it's not actually begging for a bailout, but asking for a line of credit if the need should arise (it is sufficiently liquid at this time). Ford right now has deemphasized its Mercury and Lincoln lines and has a clear set of cars marketed for specific purposes, from the Focus to the Fusion to the Escape to the Explorer to the F150, 250, and 350. Only the Econoline sucks. (Do they still make it?)
Same thing with Toyota. Yaris, Corolla, Camry, Prius, Tundra, etc. These all meet specific marketplace needs, and Lexus has its own brand identity that doesn't really compete against Toyota directly. But GM? It keeps adding new product lines, new badgings, and it's difficult to even tell which Chevy is aimed towards which demographics. Imagine if the Chevy Malibu and Saturn Aura didn't have to compete for marketing dollars--no wonder the Ford Fusion and Camry and Accord are whupping it. Tell me the different between an Oldsmobile and a Buick, without referring to the median age of its drivers.
American labor conditions aren't stuck in the past, American cars are. Whoever looks into the future and creates a carbon-neutral, sustainable energy business model is going to make a bundle of money. If T. Boone Pickens does it, that spells one direction for the economy. And if Barack Obama does it, that spells another--"good Socialism," the Swedish kind. Either way, though, what are we waiting for?