Jack Lessenberry Essays and Interviews

Essay: Driving into the Future - 3/31/08

Last week the Associated Press filed a story out of Detroit that was meant to show some hope for the auto industry. It featured a 41-year-old computer specialist shopping for a new car. His old car was wearing out, and he needed a bigger one for his growing family.

So what kind of car was he looking at? A Honda Accord, a vehicle that while made in Ohio, is owned by a Japanese firm and is made with non-union labor. Or at least, not by United Auto Workers labor.

The computer specialist said he plans to look at American-made vehicles too, and said he believes General Motors is building better cars now. But he has been driving a Honda Civic.

And you can bet that in the end, he’s most likely to buy a Honda Accord. He’s been driving that Civic for thirteen years, and has been happy with it. Detroit is making better cars now. But a generation of consumers exasperated by poor quality switched to foreign, mostly-Japanese-made cars in the 1970s and 1980s. And Detroit is finding it very hard to win them back. That’s one of the two biggest problems for the auto industry.

The other was dramatically illustrated by something the CEO of American Axle & Manufacturing told the Detroit Free Press: “We have the flexibility to source all of our business to other locations around the world, and we have the right to do so.”

And he added, “We will not be forced into bankruptcy in order to reach a market-competitive cost structure in the United States.”

More than a month ago, workers at American Axle walked off their jobs on strike. That’s because American Axle wants to cut wages in half. The company claims that its current costs are about three times those of its rivals, and it can’t compete.

That is, indeed, a serious problem. But so, union members rightly add, is trying to figure out how to feed and clothe a family on half of what you’ve been used to making.

Walter Reuther and Doug Fraser and the other pioneers of the UAW had plenty of problems getting their union started. But coping with threats to move production to Mexico wasn‘t one of them.

Meanwhile, the United Auto Workers are failing to organize any of the new transplant auto factories. Every year sees UAW membership grow smaller and smaller.

Once, the UAW represented more than a million and a half workers. Now, that‘s down to less than 465,000. That‘s fewer than when the Japanese attacked Pearl Harbor.

The union doesn’t seem to know how to cope with globalization. But the companies don’t seem to realize that if you move all the jobs to other countries, there won’t be much we will be able to buy.

Japan built its auto industry on the philosophy that workers and management would make joint sacrifices for the good of all. We pay lip service to that concept, but don’t really practice it.

But considering the alternative, it just might be worth a try.

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Interview: Sean McAlinden - 3/31/2008

The domestic auto industry has been struggling over the past year, and the challenges keep coming. The strike at American Axle and Manufacturing is now affecting production at GM. Domestic sales for all three automakers seem to have slumped in March… And, Ford just sold Jaguar and Land-Rover for a fraction of what the company paid for them. Sean McAlinden is chief economist at the Center for Automotive Research. Michigan Radio’s Jack Lessenberry spoke with him about the many hurdles that face the domestic auto industry.

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Essay: Weak Dollar - 3/28/08

Years ago, I worked for a publisher who was approaching ninety. He was a marvelous man with a great sense of humor. When I asked what it was like to be his age, he said it was great.

“You don’t have to care about long-term capital gains."

Well, the United States of America is approaching age 232. But unlike my late friend, we have a lot to worry about, especially if we want to be around for awhile. If you look at the national psyche, it is clear some things get way too much worry time, like Lindsay Lohan.

Others get about the right amount, such as Iraq.

But there are other things we don’t think nearly enough about, such as the fragile underpinnings of our economy.

I am not an economist, but I talk to people who are, and read what they write. And for the first time in my life I am seeing sensible, sober economists talking about the D-word, not just the R-word.

As in, Depression. They usually say they don’t think we are likely to have another Great Depression, but they admit the possibility is there. And that should scare the pants off all of us.

What’s worse is that any new depression would probably be far harder to climb out of than the one in the 1930s. Even then, it took a world war to really end the downturn’s effects.

Now, we are much more dependent on other nations. That’s one reason the dollar is weak. We have gotten used to an extravagant consumer lifestyle. For decades, we have been buying far more stuff from other countries than they buy from us. About two to three billion dollars worth a day, that is.

Having a weak dollar helps with that, to some extent. It means the value of the stuff we are selling goes up.

It also makes it much more attractive for foreigners to buy our products or vacation here.

That’s good. But it means it is harder for us to travel, and that the price of electronic stuff is likely to soar.

But that’s not the real worry. The dollar has been the key world currency since World War II, the one other countries use to set prices, such as for crude oil and commodities.

However, there is a strong new kid on the block -- the Euro. Originally, it was designed to be equivalent to the dollar.

Today, one Euro is worth about $1.60. If OPEC, the Organization of Petroleum Exporting Nations, were to start setting prices in Euros, we would have to pay a lot more for oil.

Our other problem is that we are now heavily dependent on borrowing from China. We owe China, in fact, a trillion dollars. If China were to decide to start investing in Eurobonds instead of American bonds, we’d be looking at a lower standard of living.

These problems are serious and real.

So, don’t you think it’s time the presidential candidates talked more about this stuff, and a whole lot less about where anybody goes to church?

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Interview: Dana Johnson - 3/28/08

The dollar has plunged to record lows against the Euro. But a weak dollar is not necessarily bad news for everyone… In fact, it may actually be good news for Michigan’s auto industry. Dana Johnson is Chief Economist at Comerica Bank. Michigan Radio’s Jack Lessenberry spoke with him.

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Essay: Card Games - 3/27/08

You may not believe it, but we had planned to talk to Richard Thompson Ford about his new book, “The Race Card,” long before the current scandal involving Detroit Mayor Kwame Kilpatrick.

But timing is everything, and I suspect that if Ford’s book were just now going to press, there would be a strong temptation to put Kilpatrick on the cover. Detroit’s mayor indeed has been formally charged with eight felonies. But he deserves his day in court, and should legitimately be regarded as innocent unless and until proven guilty. That is, he hasn’t been proven guilty of perjury and obstruction of justice. He is certainly guilty of playing the race card.

Consider this:

Two weeks ago, at the end of his annual State of the City address, the mayor shocked even his supporters by pronouncing the taboo N-word, saying that since the scandal began, he had been called that name “more than any time in my entire life."

He claimed that this was really about trying to destroy his family, and that an “unethical, illegal lynch-mob mentality” was literally threatening the lives of his wife and children.

The clear implication was that it was those familiar sinister white racists behind all this. That’s a compelling argument that was designed to push emotional buttons.

It has worked before. When he was running for re-election, he bought a full-page ad accusing me of being part of a “Media Lynch Mob” for criticizing him. One of my fellow mob members was Mildred Gaddis, a very black talk show host from the South.

Absurd as it was, that seems to have helped him them.

But this time, his argument is so absurd that it is hard to imagine anyone not seeing through it.

Just to recap: Kilpatrick got in major league trouble over 14,000 text messages that he exchanged with his chief of staff.

Turns out the two, both of whom are black, seemed to have lied on the witness stand about whether they had an affair. If proven in court, that’s called perjury. They also seemed to have lied about whether they conspired to fire a deputy police chief, who is black.

Further text messages appear to show that Bobby Ferguson, a crony of the mayor’s who also happens to be black, got improper inside information and sweetheart contracting deals with the city.

When all this became known, the MetroTimes, a newspaper whose editor happens to be black, called for the mayor’s resignation, as did six out of seven black members on the City Council.

This week, Wayne County Prosecutor Kim Worthy, who happens to be black, announced she was filing charges against the mayor and his former chief of staff.

Black people are accusing the mayor of lying to black people and improperly using public money collected mostly from black people. Somehow, the hand of the Ku Klux Klan doesn’t seem visible here. What we have instead is perhaps the world’s most politically absurd attempt to play the race card.

Let’s hope that this time, everyone is able to recognize a joker.

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Interview: Richard Thompson Ford - 3/27/08

Race has been an underlying issue in Mayor Kwame Kilpatrick’s text message scandal. The mayor shocked many last month, when he used the “N-word” in his State of the City Address. He went on to say that he was the victim of a “lynch mob mentality.” Richard Thompson Ford is the author of the book, “The Race Card: How Bluffing About Bias Makes Race Relations Worse.” Michigan Radio’s Jack Lessenberry spoke with him about whether or not Kilpatrick is playing the “race card.”

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Essay: Health Care - 3/26/08

Michigan has lots of economic problems, but here’s one area in which we are still doing better than most states: Health Care.

According to a Gallup poll commissioned by the non-profit Council for Excellence in Government, eighty-five percent of people in metropolitan Detroit have health insurance. We can thank unions for that, and a legacy of strong, employer-paid health plans. And most of the people who have health care plans were very happy with them.

But for those who don’t have health care, and even for some who do, life can be a nightmare of confusion and worry. They often don’t know what their options are. Too often, they end up using hospital emergency rooms as their primary medical care provider, clogging up the system. And ominously, one out of four Detroit-area residents said they put off medical treatment in the last year because of inability to pay.

And now for the bad news.

The number of the uninsured seems certain to grow, as the impact of the auto layoffs and buyouts continues to be felt. Those who are still insured are finding that the cost of their coverage is continuing to increase. In some cases, that’s happening even as the breadth and quality of their health care goes down. New employees are sometimes finding it difficult to get health care at all.

People are aware of all this. What they don’t understand is what can be done about it.

The Council for Excellence in Governments is making what sounds like a good faith effort to get perspective from the grass roots about health care. Certainly, anything that spurs discussion about health care is valuable. We’ve largely had our heads in the sand since 1994, when Hillary Clinton’s attempt at health care reform failed.

Since then, things have gotten worse. I am not sure, however, how they expect anything meaningful to come out of tonight’s meeting, which will be moderated by CNN’s Frank Sesno. They are going to have a large audience, a panel with four regional experts, including the surgeon general of Michigan, and the whole event is only scheduled to last an hour and a half.

Nevertheless, there seems to be a growing awareness that we have to do something, or the elephant will soon fill the entire room. All three presidential candidates are talking about providing some form of near-universal health care coverage.

The devil, of course, is in the details, and in who pays. But the longer we put off tackling the problem, the worse it will be. The Gallup poll commissioned for tonight’s conference showed that Michiganders have two major priorities when it comes to health care.

We want to control fast-rising healthcare costs -- and provide health insurance for all children. We also want to be allowed to take our health care with us when we change or lose a job.

Accomplishing all those things may be difficult. But we may finally be at the point where it is politically unacceptable and morally impossible not to try.

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Interview: Patricia McGinnis - 3/26/08

There is one issue the vast majority of Americans agree is huge in this election:  Health Care.  Two-thirds of voters say they are paying close attention to the candidates’ positions on health care.  Tonight, the non-profit Council for Excellence in Government is conducting a town hall meeting in Detroit on the future of health care.  Patricia McGinniss is president and CEO of the council.  Michigan Radio’s Jack Lessenberry spoke with her.

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Essay: Great Lakes, Great Region

You might not be automatically turned on by a report called “The Vital Connection: Reclaiming Great Lakes Economic Leadership in the Bi-National U.S.-Canadian region.” In fact, if you found one lying around, a glance at that title might make you read the wallpaper instead.

But this is a fascinating document. If you do pick it up, or download it, as I did, you are likely to learn things about our region you never imagined. In some ways, this study should make you both confident about our collective future – and worried at the same time.

To start with the good news, the Canadian provinces and American states surrounding the lakes are an economic powerhouse, far more so than most of their citizens’ suspect.

Nearly two-thirds of all trade between the United States and Canada flows through the Great lakes states. That’s more than $1.2 Billion dollars every day. The lakes themselves contain ninety percent of our nations’ supplies of fresh water. Additionally, entire industries and communities have grown up around them.

For a long time, most of us barely realized that we were one economic zone that straddled two nations. Then came September 11th. Suddenly, we became paranoid about security, especially after a totally false story claimed that the hijackers had come through Canada.

Suddenly, the border was real. Inspections were taken seriously. And it became common to face long waits to get across.

Some of this has been good. It is clear that since the fall of 2001 more people on both sides of the border have come to realize how closely our economies and our interests are intertwined, and how much we depend on each other. This study also goes beyond those concerns to detail the threat our economies face from globalization.

Most importantly, it is designed to help both nations take steps to move from our declining industrial legacy to a modern knowledge-based economy. Both countries have a lot of work to do.

On some issues, however, it seems clear that more Canadians get it than we do. To risk messing up the ecology of the Great Lakes by water depletion is to risk dooming all of us.

Yet most states, including Michigan, have yet to ratify the first baby step in the right direction, the Great Lakes compact. We have been far too slow to do much to check the spread of invasive species that arrive in the ballast water of ocean-going vessels.

And for whatever reason, we have been content to depend almost totally on an ancient privately owned bridge for half a billion dollars a year in trade. If anything happened to the Ambassador Bridge, Michigan and Ontario would be plunged into economic depression.

Yet we have been reluctant to commit to any alternative. The Vital Connection makes a number of recommendations aimed at building a joint future. Not all of them will come to pass. But some are essential. What we don’t need to do is to keep putting our heads in the sand. Especially when the old familiar tides are running out.

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Interview: John Austin - 3/25/08

The Great Lakes region is essential to both the U.S. and Canadian economies. Now, a new report suggests that they are even more important than most of us know. And, that both nations need to make some big changes to remain economically competitive. John Austin is director of the Brookings Institution’s Great Lakes Economic Initiative. He is also the main author of the new report entitled, “The Vital Connection: Reclaiming Great Lakes Economic Leadership.” Michigan Radio’s Jack Lessenberry spoke with him.

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