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- This stuff is beginning to sound alarmingly familiar to me
This stuff is beginning to sound alarmingly familiar to me
- By Richard Burger
- Published 05/26/2009
- Commentary
- Unrated
What would it take to “save” the U.S. auto industry? What I really mean, of course, is saving General Motors and Chrysler Corporation, or whatever the president wants it to be called, now that it’s been acquired by Fiat. Really, I feel kind of sorry for Chrysler. First it was the Germans and now the Italians. It’s kind of hard to think of Chrysler as an American company any more.
Anyway, it seems to me there’s been precious little discussion about what is meant by saving those companies. I mean, the whole mess got started when it was decided that they were too big to fail. To my way of thinking, failing means going out of business. So not failing must mean staying in business, and that must mean being able to build and, more importantly, sell vehicles at a profit, if you’re a car company.
Though there has been plenty of discussion, so far it’s all been about who’s going to get the money the government has been borrowing and doling out hand over fist and how much they’ll get.
For the sake of argument, let’s forget the fact that the federal government has no authority whatsoever to act to prevent any corporation from ceasing to do business, and focus for a minute on what it would take to keep GM and Chrysler from folding up their respective tents. Obviously, the money they’ve been given so far didn’t do the trick. It seems to me that all the auto bailout money has done is provide the basis for a new definition of “toxic asset.”
Firing GM’s a chief executive, and strong-arming Chrysler’s creditors doesn’t seem to have done much good so far, either.
Now U.S. automakers get to deal with accelerated (what a terrible pun) and ever more stringent corporate average fuel economy standards. The most likely result of that move by the federal government will be to force the Not-So-Big Three to make at least some of their cars so small and so light that they should by all rights be forced to carry a warning label that says something like “This vehicle meets all federal standards for fuel economy at the time of manufacture. WARNING: Operating this vehicle on the public highways may be hazardous to your health and may result in serious injury or death in the case of accidents with vehicles that don’t meet all federal standards for fuel economy.”
If you think that’s a joke, the National Academy of Science has linked mileage standards to about 2,000 highway deaths per year, and the National Highway Traffic Administration has estimated that every 100-pound reduction in the weight of cars results in an increase of more than 700 fatalities annually.
Call me crazy, but if I have to choose between a little climate change and the prospect of being smashed like a bug in my new GM or Chrysler car, it won’t be much of a contest. My guess is that might be true for a lot of other potential car buyers, too.
Of course, electric cars would probably be heavier, being chock-full of batteries and all, but there’s that pesky problem of having to recharge them all the time, and I haven’t heard anyone talking about where all the extra electricity will come from.
Except, of course, when the president said before he was elected that he’d make it a point to put any new coal-fired power plant out of business. Then again, that was a few months ago. He’s probably changed his mind about that by now.
I’ve more or less given up trying to make any sense out of what’s coming out of DC. It’s beginning to sound more and more like someone has taken a page from the Vietnam era: “In order to save the auto industry, it became necessary to destroy the auto industry.” -RB
Anyway, it seems to me there’s been precious little discussion about what is meant by saving those companies. I mean, the whole mess got started when it was decided that they were too big to fail. To my way of thinking, failing means going out of business. So not failing must mean staying in business, and that must mean being able to build and, more importantly, sell vehicles at a profit, if you’re a car company.
Though there has been plenty of discussion, so far it’s all been about who’s going to get the money the government has been borrowing and doling out hand over fist and how much they’ll get.
For the sake of argument, let’s forget the fact that the federal government has no authority whatsoever to act to prevent any corporation from ceasing to do business, and focus for a minute on what it would take to keep GM and Chrysler from folding up their respective tents. Obviously, the money they’ve been given so far didn’t do the trick. It seems to me that all the auto bailout money has done is provide the basis for a new definition of “toxic asset.”
Firing GM’s a chief executive, and strong-arming Chrysler’s creditors doesn’t seem to have done much good so far, either.
Now U.S. automakers get to deal with accelerated (what a terrible pun) and ever more stringent corporate average fuel economy standards. The most likely result of that move by the federal government will be to force the Not-So-Big Three to make at least some of their cars so small and so light that they should by all rights be forced to carry a warning label that says something like “This vehicle meets all federal standards for fuel economy at the time of manufacture. WARNING: Operating this vehicle on the public highways may be hazardous to your health and may result in serious injury or death in the case of accidents with vehicles that don’t meet all federal standards for fuel economy.”
If you think that’s a joke, the National Academy of Science has linked mileage standards to about 2,000 highway deaths per year, and the National Highway Traffic Administration has estimated that every 100-pound reduction in the weight of cars results in an increase of more than 700 fatalities annually.
Call me crazy, but if I have to choose between a little climate change and the prospect of being smashed like a bug in my new GM or Chrysler car, it won’t be much of a contest. My guess is that might be true for a lot of other potential car buyers, too.
Of course, electric cars would probably be heavier, being chock-full of batteries and all, but there’s that pesky problem of having to recharge them all the time, and I haven’t heard anyone talking about where all the extra electricity will come from.
Except, of course, when the president said before he was elected that he’d make it a point to put any new coal-fired power plant out of business. Then again, that was a few months ago. He’s probably changed his mind about that by now.
I’ve more or less given up trying to make any sense out of what’s coming out of DC. It’s beginning to sound more and more like someone has taken a page from the Vietnam era: “In order to save the auto industry, it became necessary to destroy the auto industry.” -RB