Yesterday I touched on a little history, and a small part of what Iaccoca did to turn Chrysler around in the early 80s. This time the stakes are so much higher than Chrysler and Michigan alone, and there must be a solid determination of the powers-that-be (in this case the US Congress) to identify which cause affects the manufacturers the worst. Who, in fact carries the role of maximum culpability in the crisis these auto giants face?
The answer I have already given. As the guilt laden perpetrators of the most heinous abuses business has, and will ever face in a supposedly free market environment, Congress carries on pointing fingers and “shaming” the executives at the helm for not being able to drive the radically altered obstacle course known as manufacturing in America.
Note the road a manufacturing entity such as GM must travel to get from point “A,” where need for product is established, to point “B,” which represents final delivery. Think of the road as placed on high plateaus, where missing a turn would surely mean falling into an abyss.
Congress mandates many things for which big business must capitulate to stay in business. Look at each hairpin curve as a labor law, manufacturing safety requirement, tax, or the very worst turns environmental stipulations. Each turn, and each bend must be negotiated not with an eye on the scenery however, but with the eye on the road, because to slow down would mean further losses in profits, and a plunge off the cliffs to the rocks below.
The PROBLEM is the result of the simple creating the complex. The SOLUTION is going to be a matter of allowing the complex thinkers to draw a straight and simple line from point to point. The inverse to look a little more like this:
Consider that the congress set aside at least $25 Billion in the energy department budget to assist the automakers in upgrading to newer “eco friendly” technology. That technology which requires fewer CO2 emissions that Congress MANDATED (because they are such gifted scientists) because the planet was/is warming so fast. Never mind that it is a patently false assertion, and the continued premise as such merely creates more poverty here, and abroad. The money set aside for the automakers as is the case with all government projections, would NEVER be enough to offset the true cost of meeting such mandates.
The solutions CONGRESS must adopt to maintain the health of the automakers and manufacturing in general for a healthy national economy are as follows:
1. Abandon Safety Rules – Bear in mind that product liability issues must still be met with responsibility by the creators of products. Allow them to assess which parts assemble together properly for maximum safety and ultimately the best bottom line return on their own production. There are other benefits to this in the reduction of government employees needed to monitor such things as well as being able to “turn on a dime” and redesign quickly and efficiently without any extended approval processes.
2. Abolish the NLRB – Only when the manufacturer has the ability to truly negotiate without fear of violating any number of draconian rules by government which limit the proper employee/employer bargaining relationship, will they be able to run these businesses as true “free market” enterprises. In this age of choices, and open information it is hardly necessary to hold manufacturer’s feet to the fire in order to secure a decent wage for a job well done.
3. Eliminate environmental restrictions on Automobiles – Or at least reduce them to limits on toxic emissions only. Buyers will not want to buy a car which spews out brown smelly exhaust, so the market will sort this out anyhow. But the reduction in mandated rules always allows for “instant” corrections to be made without costly and time consuming “certification” processes.
4. Eliminate and refrain from establishing federal drilling restrictions. – Allow the local (state) constituencies to negotiate their own drilling guidelines much like Alaska.. Even on Federal lands within their borders. This would ensure that there is a ready supply of oil and resources for vehicle use, and for national security. It also would keep oil and gas prices on an even keel versus the unnatural ups and downs created by an invasive government presence in the process.
These are four items which I believe if acted upon as stated would be a GUARANTEE that the automakers could pay back any loans we as taxpayers are on the hook for. Though I doubt a single effort by THIS congress will be made in the direction as described above, I remain eternally optimistic that we as a nation will at some point in my lifetime rediscover how TRUE free markets really bring about prosperity and health of a nation.