A Radical Thought



I don’t know about you, but I’m really concerned about the amount of money being given to various companies to bail them out as a result of their own failures.  I’ll fully admit, I don’t understand the complete economic picture, but I’m willing to concede that having these big companies fail could have a significant impact on the general health of the US economy.

So here’s a radical thought pertaining to just one struggling industry, the auto industry.  During WWII, the auto industry was effectively forced to change from producing automobiles to military equipment.  In these times of serious climate issues, clogged streets, and degrading infrastructure, why not require the bailout money be used by the auto industries to ramp up production that could support alternative transportation?  Have them start producing buses, trains, and materials to support a booming rail industry.  This would keep the people involved with the auto industry employed and yet help take us towards a brighter future.  Wouldn’t this be a better use of our tax dollars?

I feel that the fact that auto industries are now failing is a clear sign that a) the industry was too greedy and focused on producing the wrong type of vehicles and b) the entire infrastructure plan, where a personal automobile is the key to transporation is fundamentally flawed.  What will be different the second time around, if these companies are allowed to continue focusing on a model that the market place has clearly determined can’t be supported?


  • Haidee
    Mar 20, 2009 at 7:57 am

    makes sense to me. i think you hit it on the nose with your reasoning as to why the auto industry is failing (can anyone say 'hummer'). add to that our country's overall short-sightedness when it comes to depending on fossil fuels for something as crucial to our economy as vehicles. i really hope we are on the way to a major paradigm shift in transportation in this country. i'm sorry it took a financial crisis to get us there, but i suppose that's how it's always been.

  • Mar 21, 2009 at 9:51 pm

    As someone who worked in automotive industry for 30 years, I'm here to explain in detail whatever confuses you. You've missed many, many complex roots, all of which directly affect automaking.

    Arrogance of makers who touted "buy American" and made everything overseas.

    Bad government policies.

    Banking deregulation.

    Board of Director rampant greed.

    Cheap imports without tariffs.

    Congressional malfeasance and misrepresentation.

    Deliberate dumbing down of education standards for political correctness (makes spin easier to swallow).

    Evil collusion between Big Oil and Big 3 to waste fuel.

    False perception of quality among Japanese imports (for a while culled best to send, kept clunkers).

    False perception of quality among European imports (actually had worse customer satisfaction).

    Faulty election process relies on lobbyists with foreign loyalties.

    Intentional failure to interdict tons of drugs being imported daily.

    Inventory taxes make it impossible to get spare domestic parts, not foreign.

    IRA and 401K divert trillions from discretionary spending.

    Management and unions both unwilling to compromise.

    Mergers designed to consolidate head counts and rob retirement benefits.

    Reaganomics and union busting.

    Safety regulations and emission standards that only affected domestic.

    SEC declawed and defanged, so no investor protection and rampant securities fraud.

    Shift of tax burden away from capital gains, corporations and highest earners and onto consumers.

    Workforce here unable to compete slave labor overseas; middleclass autobuyers disappear.

    Failure to react to market needs is probably last on a long list. Consumers bought on price, size or status, not quality. To minimize prices, makers had to standardize as much as possible. Market didn't reward innovation, and so suppressed alternatives. Makers always drove out any competitor who threatened their status quo.

    Economists agree that the #1 most important change to raise us out of The Great Depression was BANKING REGULATION. Bailing out banks is lunacy. Who do you think loans the government money to operate? This is not bailout, it's blackmail. Recession? In RI, less than HALF of residents are gainfully employed (485,000 employed to 1,010,000 residents). At depth of Depression unemployment was only 25%. Nowadays they only count NEW UE claims and forget you once your off the dole.

    Bad federal policies caused all ills facing Americans today. The best thing you could do is recall all your Congressmen and replace them, like they did the governor of California. Oops! That's how they wound up with Hummer collecting Scharwenegger. The American public collectively is to blame for not being vigilant, subrogating all their responsibilities to guys in suits who've never worked a day in their lives, and waiting too long to support green approaches. There are solutions to all these issues, but this forum isn't the place to air them. Nobody pays any attention at all, anyway. In RI, 1/6 of the population is functionally illiterate in any language. English isn't even the national language anymore, even though it's the most widely spoken language on Earth (yes, ahead of a billion Chinese, many of whom also speak English).

    We've fallen and we can't get up. Is this what Americans wanted? They chose to become a third world country. Sad.