Wednesday, October 31, 2012

Savior of Our Auto Industry? Let me give you my slant!

In an abrupt turnaround, it appears that President Obama has decided to move away from the constant Romney character attacks and embrace his dismal record by painting it as successful. And I quote: “Obama not surprised election is so close despite his accomplishments”. Excuse me, his what? As he continues a campaign tactic that can be summarized with: throw everything against the wall and see what sticks, the Obama campaign is currently feasting on the remarkably sticky claim that he single handedly rescued the American automobile industry. NPR yesterday morning praised the President’s lead amongst mid-western blue collar white voters as being a combination of the president’s saving the American auto industry, and the view that Romney is a corporate raider that sells off corporate assets, makes his money and leaves town. You know, not one of us believes that! How is it that the constant force-fed repetition of misinformation is eventually regurgitated as fact? AOL, which apparently has sold its soul to the Huffington Post, is trumpeting a headline that reads: Romney Ad about the Auto Industry is Misleading. Of course that is the interpretation of the writer, and by writer I mean the HuffPost propagandist du jour. And Mr. Obama keeps repeating the headline of the article Romney wrote, entitled “Let Them Go Bankrupt”, content with the knowledge that most of America doesn’t understand bankruptcy and very few of them will actually read the article.
Newsflash: Bankruptcy, boys and girls, is not the end of the company. Bankruptcy will protect you from your creditors and allow you to restructure so that you may re-emerge as a streamlined, lean, mean profit machine. Yes, the same thing that Obama did minus the streamlined, lean, mean and profit part. The difference is that Romney wanted it to happen with private investment, not on the taxpayers dime. The taxpayer is on the hook in the Obama plan, and should the company fail, the taxpayer is out a lot of dimes. Furthermore, Romney wanted the auto industry to emerge from bankruptcy without the burden of union contracts, whereas Obama predictably pandered to the unions. The reason that America can’t make a profitable automobile is that we pay way too much in union perks. We have too much of the profit on that Chevy going to union pensions and union healthcare plans that are bloated, and economically unsustainable. That is why we have to sell an awful lot of those big old trucks and SUVs, because that is the most profitable item Detroit offers. We just can’t make ends meet on a Chevy Malibu or a Dodge Dart, let alone the Volt (let’s not even venture into that debacle). And apparently those unions just can’t seem to make a quality vehicle anyway. It is highly entertaining that on this same day, a report was released on the reliability of automobiles. The top seven spots were held by Japanese vehicles (yeah, yeah, some are made in America but they are still not the Detroit that Obama claims to have saved) with Chrysler at the bottom and GM barely above that. So Obama may lay claim to having saved the American auto industry, but if he did, he apparently saved a pretty lousy auto industry.

So is it just that Americans cannot build a quality vehicle? If so, how do you explain the scores of Toyotas being produced in American factories by American workers? Is it that Americans cannot design a quality vehicle? We have in the past, and given our propensity for designing some high tech gadgets it is unlikely that we are incapable of producing a product based on century old internal combustion technology. Or could it possibly be a union issue? Has the UAW produced a union contract that is so benefit laden, that it makes the American automobile manufacturer unable to compete? Has the union worker, so content in his job security evolved into a poorly skilled laborer? Perhaps, as Jon Cutler, a sociologist and most likely a socialist, opined in the LA Times back in 2008: “when the UAW exposed the Big Three to insurmountable competitive disadvantages, it cut its own throat*.

So who should we believe on the subject of bankruptcy, business and industry while on the stump? We certainly can’t rely on the objectivity of the mainstream media pundits. How about the successful manager of Bain Capital, the Harvard Business School and Harvard Law School graduate, the man who presided over the Salt Lake City Olympics, the Governor who balanced a Massachusetts budget after a 3 billion dollar deficit, the man who amassed a fortune through his success in the business world. Or would you choose the community organizer, the product of affirmative action, the constitutional scholar, the one-term senator, the Harvard lawyer, the king of demagoguery, the man now running on his accomplishments. Seriously. Given their respective resumes, who would you choose? Sticky indeed.

*It is interesting to note that Jonathan Cutler, a Professor of Sociology at Wesleyan University proposed in the same editorial a solution to the union disparity between US based Japanese auto plants and their American counterparts: Unionize the Japanese transplants. Exactly what you would expect from a socialist. Rather than streamline the inefficient American auto industry, hobble the successful innovators.

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