Tuesday, December 9, 2008

What an Auto Bailout Will Bring


Fast forward 20 years and the future of the auto-industry with a bailout is clear. Over the last several days, I have heard congressman like Barney Frank talk about how, with government control, they will be able to make the right cars. Emmanuel Cleaver, congressman from Missouri, said that with government money, the government will get to choose how the industry is run.

Is this what we really want? Did we elect the representatives so that they could run businesses. I hate to say it, but most of them are in the line of work they are in because they couldn't run or work for businesses in the private sector. I have not in my life time, nor in any time past, seen a single example of a government run business that is successful. The current crop in Congress very much want this control. They want to limit the number of models available, green up the cars, and keep the unions in place. They want to eliminate the very market forces needed to save this industry.

We have seen what this kind of government intervention leads to. Look at some of the wonderful automobiles that were produced behind the iron curtain. The soviet era AvtoVAZ, the Volkswagen of the people, minus the dependability. Do we want a nation of Yugos and VAZs. Go ahead and let the government take it over. The only choice you will end up with for domestic cars is what color car you want to have, who's paint will chip off anyway. I'm sure the Japanese are lovin this.

9 comments:

thejotus said...

Are you referring the chipped paint to your van?

jrchaard said...

Yes. Or as it is called here at work, "Brown top"

Kansas Bob said...

Ann and I were just talking about how sad it is that Japan builds better quality cars that Detroit. I get that they can build cheaper cars but how did Japan ever surpass us in engineering and quality. I am opposed to the bailout.. but guess that no one will solicit my advice on it

jrchaard said...

Obviously, I'm opposed too. I think that Japan has lower production costs, which allow for better engineering. When US labor costs are so high, they have to trim some where. It was only a matter of time before they eclipsed us.

Kansas Bob said...

One of the arguments the automakers give is that Japan has socialized health care. What do you think about that?

jrchaard said...

Socialized healthcare comes out of tax money that the workers and manufacturers must pay. So their profits are still hampered by this cost.

Kansas Bob said...

It is a conundrum isn't it Scott.. I mean really.. how Japan makes better cars than we do?

It seems that America should be able to do better.. once upon a time we did.. I remember how much of a joke it used to be to buy a Toyota or a Datsun.. it wasn't that long ago.

I think that my generation dropped the ball during the decade of greed (the 80s).. both executives and workers let it happen.

Generation X doesn't seem to get it either.. seemingly no commitment to quality.. just what is in it for me.. from my limited perspective dealing with them in software development anyway.

Once upon a time I had tremendous loyalty towards the corporation that I worked for and retired from. I just don't see it these days in the execs or the workers. Until it changes other countries that have "hungry" execs and workers will continue to eat our proverbial lunch.. making better and cheaper products.

Sorry to be so negative.. just don't see a positive future for the auto industry or many other "American" industries.

jrchaard said...

it is kind of like sports. There was an era when a player would play and retire for just one or two teams. The team meant something. Now, players are not a team, but a group of individuals that just go from paycheck to paycheck. Even the Army is now an Army of One.

Kansas Bob said...

It may be an Army of One but my son will tell you that there is a tremendous amount of camaraderie on the front lines in Iraq.. but he may not say such kind things about those calling the hot in Iraq :)

I guess I am hoping to see some kind of inspirational leadership arise in Corporate America.. leaders who will tell it like it is.. leaders who will say no more to greed.. who will take care of their workers AND stock holders.. leaders who care about long-term AND short-term success.. alas.. I preach to the choir :)

I get so tired of (political AND corporate) executives that make excuses instead of taking responsibility. Really.. can we just have leaders like Missouri's favorite president who said The Buck Stops Here?