About a year ago, on one of those television panel shows where we all pretend to know everything, I was railing about the shortsightedness of the U.S. auto industry in cranking out huge SUVs that could be seen from space at a time of rising gas prices. It reminded me of the last time disaster struck Detroit, when the car companies got caught with stockpiles of enormous boats with ridiculous tail fins no one wanted, allowing foreign imports to hijack the American market for small, well-built, fuel-efficient cars.
The reason I remember the show is that Republican state Rep. Jeff Stone lectured me like a child. Apparently, I didn’t realize, Stone said, that those big SUVs being produced in Janesville were General Motors’ most profitable vehicles.
Apparently, Stone and General Motors didn’t realize that dinosaurs have extremely short life spans. Last week General Motors announced it was closing the Janesville plant, eliminating about 2,600 jobs there, along with three other plants in Ohio, Canada and Mexico. That’s right, plants in Canada and Mexico, too.
GM’s overproduction of gas-guzzling behemoths and $3.3 billion in losses in the first quarter of this year means not even cheap Mexican labor can get the company into heaven anymore. “Did GM just wake up yesterday and realize gas prices were high?” Gov. Jim Doyle demanded to know. “Why didn’t they get some lines in here that could withstand these prices?” Doyle has every right to question GM management. In 2004, Wisconsin agreed to contribute $10 million to a $175 million plant upgrade in Janesville. As part of that agreement, GM promised to keep 3,330 workers at the plant through 2010.
Now, 2010 is the date when all production at the plant is scheduled to cease. The first cuts in July will eliminate 750 jobs. With employment in Janesville around 2,600 at the time of GM’s announcement of the closure, it appears the company already has been in violation of its agreement with the state.
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Lack of Vision
Politicians should know better than to trust the word of a company such as General Motors. That’s because politics and big business have exactly the same problem with what the first George Bush once called “the vision thing.” Politicians typically look no further ahead than the next election. That is what prevents government from tackling long-term solutions to the most pressing problems we face.
Global warming? National health care for everyone? Creating a solid, financial structure to protect Social Security for future generations? Those are all major problems that require long-term solutions. We can count on a couple of fingers the presidents within memory who had the vision to think long-term. They were President Franklin Delano Roosevelt, who created Social Security, and President Lyndon Johnson, who passed Medicare, Medicaid and the Civil Rights Act.
The last president in a position to extend Social Security for future generations and to create universal health care was President Bill Clinton, whose conservative handling of the economy created record budget surpluses. Unfortunately, Clinton’s administration was followed by that of George W. Bush.
Instead of using those record surpluses to benefit all Americans, Bush decided to give away all the money to rich people in the form of tax cuts weighted heavily toward the wealthiest 1%. Voila, record budget surpluses became record budget deficits.
The only people more small-minded than most politicians are the corporate leaders of American business. America’s business leaders don’t even have the same vision as politicians who only look two to four years ahead. They typically look exactly three months aheadto the next quarter. The grossly inflated salaries, bonuses and stock options for top executives all depend on the short-term bottom line. They fatten themselves by cutting costs and increasing profits each quarter.
The last thing corporate executives want to do is to spend any money before they have to, just to position their companies for the future. Future, schmuture. By the time the future gets here, the present corporate officers figure they will have bailed long ago with their platinum parachutes.
Unless, of course, you happen to be the present management of GM and other U.S. car companies caught red-handed while scattering mammoth dinosaurs across a landscape that can no longer sustain them. U.S. automakers couldn’t see around those gas-sucking mountains of metal to notice foreign car companies gaining an enormous head start in developing the gas-conserving hybrid technology of the future.
It’s funny how avoiding future disaster seems to be closely tied to having knowledge of the past. President Bush wouldn’t have been so eager to get us into an open-ended war if he had attended a few of those Vietnam teach-ins when he was in college. And U.S. carmakers should have recognized the similarities between the Tyrannosaurus rex and the Hummer.
What’s your take? Write: editor@shepex.com or comment on this story online at www.expressmilwaukee.com.
