Essay: A Sense of Perspective - 3.30.09

Michigan Radio's Political Analyst Jack Lessenberry is thinking about the future of the auto industry.

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The other day I was corresponding with the legendary Jack Casey, who has been a public affairs analyst for more than forty years. I knew he'd come to Detroit to be a reporter for the Free Press more than fifty years ago, back in 1957.

Here's what he told me last week. "The first major story I worked on was the release of a major economic study by a University of Michigan team about Michigan's future." What did it say?

"Well, the bottom line was that Michigan must get off its dependence on the auto industry. So what happened?" he said. "Nothing. The attitude in the industry was, 'Why change? We are smarter and nobody can match us.'"

Well, we know what eventually happened. After years of decline, by the end of last year, the entire industry was on the point of collapse. Former President Bush threw Chrysler and General Motors a lifeline then. This morning, President Obama announced his plan. General Motors’ chairman Rick Wagoner is out, and the once-mighty automaker has sixty days to get its act together. Chrysler has thirty days to merge with Fiat, or else.

Nobody is likely to be completely happy with the Obama plan. As we saw last December, a significant faction in Congress thinks the government should just pull the plug and let those two once-mighty automakers declare bankruptcy and, maybe, go out of business.

On the other hand, the Detroit News complained yesterday that the president should stop "bad-mouthing" the auto industry. That's evidently because he said "There's been a lot of mismanagement (of it) over the last several years."

This is an industry that has been losing millions an hour for years, while at the same time stoutly resisting any kind of major and necessary change. If that's good management, Three Mile Island was one heck of a well-run nuclear power plant.

By the way, polls show a majority of voters outside Michigan don't think the President should "bad mouth" the domestic automakers. They think he should just let them die.

What we have to realize is that the President's cuffing the automakers around a bit for their past sins is not only justified, it is probably politically necessary if he is going to help them now.

Everything I've heard from President Obama on this so far has smacked of extreme common sense. Last week, he said he thought that while it is appropriate for taxpayers to provide help, the price should be that the industry reform itself.

Now it is time for a some common sense on our part. The domestic auto industry may survive. But here's the important thing to remember. It will never be what it was. Not only will its market share continue to shrink; never again will masses of unskilled kids be able to leave high school and get good paying jobs on the assembly line, jobs that will last for life.

That's over, forever.

Yes, we need to save the auto industry if we can. But the more important debate should be about how to invent a new future for the rest of us. And we better get started.

After all, we're only about half a century behind.

Comments

[Anonymous]

Jack Lessenberry may be the only member of Michigan's political class who is congratulating Barack Obama on what can only be understood as a craven politcal move in demanding the resignation of Rick Wagoner.

Here is a good question to start with: The firing of Rick Wagoner, in whom the GM Board had considerable confidence, will help GM return to profitability... how?

Additionally, let's ask; replacing Wagoner with Fritz Henderson will improve the GM profitability picture... how?

It seems to me that Obama has made every possible bad decision, in the worst ways possible, over the past 24 hours. He's said to the world and to Fiat, "do whatever you want to with Chrysler; I just dropped the bottom out of whatever negotiating position they had. And GM? They are working for us now."

And in the same breath (this one's a real quote, if you can believe it) Obama actually said;
"The pain being felt in places that rely on our auto industry is not the fault of our workers; they labor tirelessly and desperately want to see their companies succeed. It’s not the fault of all the families and communities that supported manufacturing plants throughout the generations. Rather, it’s a failure of leadership — from Washington to Detroit — that led our auto companies to this point."

Hmmmm. That's nice to know. And so that is why, I suppose, nobody in the Democratic Party is asking Ron Gettlefinger to resign.

But Obama also talked about bankruptcy. Intersting, isn't it, that if a Rpublican Senator from Alabama talks about a GM bankruptcy, Jack Lessenberry interprets it in terms of greed and bribery and parochialism and racialism, in terms evoking comparisons to the Civil War. But if O the Great One talks about bankruptcy it is intelligent, practical, nuanced and sensible. Well here is what Obama said:
"While Chrysler and GM are very different companies with very different paths forward, both need a fresh start to implement the restructuring plans they develop. That may mean using our bankruptcy code as a mechanism to help them restructure quickly and emerge stronger.
Now, I know that when people even hear the word 'bankruptcy' it can be a bit unsettling, so let me explain what I mean. What I am talking about is using our existing legal structure as a tool that, with the backing of the U.S. government, can make it easier for General Motors and Chrysler to quickly clear away old debts that are weighing them down so they can get back on their feet and onto a path to success; a tool that we can use, even as workers are staying on the job building cars that are being sold.
What I am not talking about is a process where a company is broken up, sold off, and no longer exists. And what I am not talking about is having a company stuck in court for years, unable to get out."

Okay, Mr. President. Let's use some bankruptcy tools even if we don't name it bankruptcy or use a bankruptcy court. Let's tear up that UAW Collective Bargaining Agreement that is bigger than the Manhattan phone book. Let's cut through the state-by-state red tape that holds the Detroit Three hostage to superfluous dealer networks. And whole we're at it, why not lift every one of the Congressional mandates that hinders automaker profitability with no discernable benefit, or that saps domestic market share versus the transplants?

Can there possibly be one single serious-minded voter in Michigan who will vote for another term of this clownshow in 2012?

[Thrasher]

Millions of voters in Michigan will vote for Obama in 2012 simply for having the common sense to get rid of Wagoner ( a classic example of an empty suit).

Clowns like Wagoner have destroyed the auto sector in our nation and it is insane some people have pity for losers like Wagoner.

This is a great thresold opportunity for our state and nation to reinvent the manufacturing sector by not making cars but retooling to make public transit units...

Our nation can create a labor intensive market around the themes of massive public transit systems..We can employ people, free the nation from foreign oil, rebuit the entire infrastruture of the nation..

It is foolish to pay attention to the angst of losers like Anonymous who live in fog of anger and grievance..

[Marv Toler]

Rick Wagoner seems like a nice guy, but he failed to get the GM stakeholders to agree to a package that will insure the company's viability. He had to be fired. There's an old saying; friends come and go, but enemies accumulate. Over the years the auto industry has fought people over safety, reliability, and environmental concerns. The automakers have little good will left. Fortunately, Obama will do his best to help them survive.