The expression “The Big Three” continues to be used, but the truth is these former American behemoths aren’t what they were. Without government intervention, it’s unlikely they would even exist.
Chrysler would have folded in 1979 if not for Jimmy Carter saving the company. Almost thirty years later, in 2008, George W. Bush re-defined Republican Capitalism by going along with rescuing not only Chrysler, but GM and all of Wall Street. Ford wasn’t going bankrupt, but it was included in the rescue package.
Considering that government intervention saved these companies, I think Biden was justified in joining striking unionized workers on the picket line. With all of the Trump lovers among the rank and file, however, I won’t be surprised if the UAW doesn’t endorse Biden.
I re-watched Michael Moore’s 1989 movie Roger & Me, and I’m re-reading his pal Ben Hamper’s entertaining and enlightening book Rivethead (1991), about working the line at GM. Hamper talks about the layoffs he went through, and he says in 1980 the pay was “$12.82 an hour.” Before overtime and not including other benefits, that comes to about $100,000/year in today’s money.
Here’s the thing for me. Detroit got into trouble because American cars sucked. Traveling on business for fifteen years, from the early 80’s through the mid-90’s, I rented many Ford, GM, and Chrysler cars. Year after year, every one one of them, without exception was, at best, disappointing, and most were awful. A particularly bad memory was a new model year Pontiac breaking down, leaving me stranded on a return drive to an airport. The rare occasion when I was given a Toyota rental, I was amazed by the quality. Detroit had a decade-and-a-half chance with me, and it failed. As a result I have never purchased a new American car, and I never will. (That includes Tesla, but for a different reason, named Musk.)
The decline of the American automobile industry was due, in my opinion, to the deadly embrace between management and union leadership that gave Japan an opening in the market. Rampant inflation in the 70’s may have started with the gasoline crisis, but it was fueled in part by union wages, at the same time that Detroit had no fuel-efficient models to offer. What did they come up with? The Ford Pinto and Chevy Vega, two of the worst cars ever made.
For a business, being “fat, dumb, and happy” can be fatal. As I saw at my own former place of employment, it means that contentment with past success can result in a failure to see competition coming up in the rearview mirror. By the time a competitor has passed you, it’s too late to catch up. Fat, dumb, and happy is exactly how Roger Smith comes across in Roger & Me, but it’s also how the GM assembly line workers could be in Rivethead, until the layoffs began
The problem for automobile management and workers today isn’t just climate change, it’s the reality that there is only so much oil left in the world. We have no choice but to find another way to power transportation. The money to pay for the cost of developing alternatives to internal combustion engines will have to come from somewhere.
Will competition between companies result in excellent technologies, or would it be smarter for the government to take the lead and pool technical resources in a singular effort? There are only so many brilliant energy scientists, electrical engineers, and mechanical engineers in the world. China seems to be educating a large percentage of them, often in the United States.
With automation already cutting the number of workers needed to assemble a car, the next generation of products will require even less labor. This is something the UAW will have to accept. A point they are rightly harping on is inflated executive pay, especially at the CEO level. Being tone deaf about income inequality isn’t a way for leadership to negotiate in good faith. And with that, I should end this rambling tirade.