The Plight of G.M.

The last time the United Auto Workers union walked off en masse from General Motors plants, some 400,000 workers stayed off the job for 10 weeks in an attempt to win a weeks vacation between Christmas and New Years Day. The year was 1970, when cars of foreign origin were considered either an exotic luxury or a cheap imitation of the real thing.

It was the golden age of the great American gas-guzzler, when consumers were paying about 30 cents for a gallon of gas, and only Jack Benny complained about the price of filling up. In Bennys case, of course, it was just an acthilarious because it was so patently absurd. Gasoline was cheap and plentiful, and there was no reason to think it would ever be anything else.


The U.A.W. recently struck G.M. againsort of. The strike lasted only a day or so, but it wasnt the strike so much as the figures attached to it that caught the eye. This time there were only 73,000 workers left to walk the picket lines. It was a reminder of how the great American job has disappeared, replaced bywhat? The very day of the strike, The New York Times reported that outsourcing companies in India are beginning to, yes, outsource their work, because Indians are getting too used to decent pay. Andwouldnt you knowsome of those outsourced jobs are returning to the United States. But they are not returning with decent wages and benefits. Those days, as the G.M. workers know well, seem to be gone forever, at least for blue-collar America.

Consider what prompted the U.A.W. strike: the union was demanding not a year-end vacationhow quaint the very idea seems nowbut protection from further layoffs and cuts to benefit packages.

The plight of G.M. and the American auto industry is not a study in how the mighty have fallen. It is a study in how the mighty took a flying, headlong leap from the heights of power and affluence. And as a result of this corporate freefall, thousands of American jobs have disappeared, and more will follow regardless of the unions action.

G.M. says it needs more flexibility to compete with the likes of Toyota and Honda. But that battle ended two decades ago, and G.M. lost. It lost not because of the unions inflexibilityafter more than a quarter-century of labor peace, one can hardly point fingers at a supposedly recalcitrant unionbut because of the collective greed and cynicism of the industry itself.

Simply put: At a time when the nations dependence on oil is threatening its national security and Japanese car companies are taking the lead in developing vehicles that run on alternative fuels, the great American contribution to automaking over the last decade has been the gas-guzzling sport utility vehicle.

Thanks a lot, folks.

When the rise and fall of the American auto industry is written years from now, the United Auto Workers union no doubt will be portrayed as an innocent victim of corporate cynicism, shortsightedness and outright stupidity. Rather than innovate, the industry used its muscle to persuade Washington to exempt light trucks, that is, S.U.V.s, from fuel-efficiency standards. Even worse, the sticker price of S.U.V.s is in essence subsidized, thanks to friendly tax loopholes.

That was Detroits response to the innovation, creativity and marketing ability of Toyota, Honda and other global carmakers. Rather than make better cars, Detroit chose to make bigger cars, imperiling not only its market share but nothing less than Americas national security. The result? An industry that is absolutely, positively addicted to a product that is the bane of the highway and a boon to those who wish us harm.

The U.A.W. has been caught in this economic buzzsaw. It could hardly be accused of standing in the way of innovation, because there has been precious little in the way of new thinking from management. Even the most vocal critic of unions could not say, in fairness, that the U.A.W. has refused to work with management in an effort to help reverse Detroits decline. The union is far from flawless, but it is to be admired for the ways in which it chose cooperation over confrontation over the last two decades. It has worked with the companies to reduce work forces and help pay for skyrocketing health care costs.

Surely it did not have to be this way. At some point 20 years ago or so, Americas car companies could have attempted a more creative response to consumer demand for good, dependable sedans. Instead, the Japanese companies, especially Toyota and Honda, became richer and more powerful thanks to their fleets of midsize and compact cars: the Camry and the Accord, the Corolla and the Civic. Those models proved astoundingly popular, but by the time G.M. responded with its Saturn models, the game was over. And so G.M. has given us the Hummer, a vehicle designed for a rapid deployment force, while other U.S. companiesaided and abetted by the friends they have purchased in Congressmock the very idea of energy independence and national security with their own gas-guzzling nightmares.

And who is paying the price for these awful strategies? The workers, of course. And as long as G.M. and the other U.S. car companies continue to self-destruct, the future looks bleak for the folks who work the assembly lines.

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10 years 12 months ago
I do not buy America Magazine to read pseudo-analysis of topics of which the America staff or columnists have little knowledge or expertise. If I want to understand what put the U.S. auto industry in the toilet I will certainly look some place other than America Magazine. (I would look to a source that has professional knowledge about the auto industry.) My desire is for an objective, honest analysis and not one burdened by the columnist's pro-union, liberal bias.


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