Howard_T

Automotive Depression: Government Needs to Let the Weak Fail

All of us have heretofore overlooked that one reason Detroit (and everyone else) is selling fewer cars is the fact that the cars that have been built over the past 10 to 15 years last longer than older models did. It used to be that, even with careful maintenance, a vehicle would wear out within 5 years, and it would be necessary to purchase a replacement. Vehicles now are built with better materials, better design (yes, even from GM, Ford, and Chrysler), and because of the repeatability of robotic manufacturing techniques, better workmanship. They just don't wear out as fast, as long as they are relatively well maintained. (I know, try telling that to anyone who has fried the transmission on a Chrysler minivan) So now the automakers are caught in the unintended consequence of having to build more reliable automobiles in order to remain competitive. There are many factors at work here, but increased life span is one that we have overlooked.

Turning Japanese: The Audacity of Reality (Part 3 of 3)

Mr. Jeremy Needham has the correct slant on things for those who believe massive spending, a la WW II, will generate a recovery. Anyone who believes that throwing massive amounts of paper at the crisis will bail us out, just because it worked to end the depression of the 30's, hasn't looked at reality. In the late 30's, the US was the only economy among the major nations to be producing consumer goods. Europe and the industrial nations of Asia had been on a war footing for at least 3 years prior to 1941. During WW II we spent massive amounts of treasure to produce the means to fight the war, but at the end of 1945 we were the last nation left standing. Our productive capacity had not been touched, and with the pent up demand for goods fueled by the savings of a fully-employed population, the economy recovered to a consumer footing with blinding speed. Europe and Asia were forced to buy from us, and whatever treasure we had used during the war was rapidly replaced.

Perhaps once the population of the US figures out the ineptitude of our political leaders, we will take the correct 14 steps Mr. Quinn has proposed. Then maybe someone will emulate an impoverished Japanese mechanic at the end of WW II. This guy bought some surplus electrical generators from the US Army, removed the gasoline engines from them, and mounted the engines on bicycles to make motorbikes. He did pretty well thereafter. His name was Honda Shoichiro.

Why We Need Higher Gas Prices

As I understand it, the argument is that higher petroleum taxes, and thus higher fuel costs, will encourage the manufacture and purchase of fuel-efficient vehicles, lessen the amount of oil imported, help to reduce emissions and global warming, and provide funds to repair road infrastructure. All these are noble causes, and should be encouraged. The problem is that higher fuel costs translate to higher costs for all goods and services used in the United States. It amounts to a tax on everything, and it hits the poorest among us the hardest by essentially taxing the basic necessities of food and clothing.

One can argue that tax exemptions could be applied for fuel used in the transportation of goods, but what of the local repair man, delivery service, building contractor, and the like? As soon as selective exemptions are applied, some government bureaucrat is now picking winners and losers, and the probability of corrupt practices grows. Let the markets dictate the price, and let the economy heal itself.

Does the Auto Industry Deserve To Be Bailed Out?

After the high-demand times of WW2, the textile industry in the Northeast began to fall on hard times. The mills were old, energy costs were high, and the workers didn't come cheaply. One-by-one, the manufacturers packed up and moved south. There was no such thing as a bailout available. In my home town, there was no industry left to speak of. What was still available was "Yankee Ingenuity". Electronics moved in where cloth moved out, and the Northeast, particularly in areas where good colleges were located, began to boom. It would seem to me that the educational institutions of the industrial Midwest could take a hard look at their curricula and start putting out graduates who could lead the recovery. If bailed out, the "Big 3" will just keep on with the old ways, the fat cats will get out with their bonuses, and the rest of the workers will watch the industry die. I don't blame the unions for what they get. The old adage is that you do not get what you are worth, but what you negotiate. It will not be easy on the workers, but the mill hands of 60 years ago survived and are now the parents and grandparents of today's engineers and technicians.

Ten Cars That Could Save Detroit

The GMC Acadia is not the savior for anyone. I rented one a few months ago, and while it ran well and had lots of nice "bells and whistles", a fundamental flaw soon came to light. I was using the vehicle for work on unimproved roads and hills in desert terrain. I had a tire go flat, and found that the vehicle not only did not have a full-size spare, it had no provision for carrying one. Even though GM promised that the donut spare could go several hundred miles at moderately high speeds, once the spare was on, the vehicle would not handle correctly at low speed, and anything more than 30 mph was out of the question. Oh, by the way, jacking up the vehicle to put on the spare was even more frustrating. The jack is built so that the handle is nearly on the ground, and it is not hinged in any way. This meant that one can only get a half-turn on the jack before having to remove and re-insert the handle.

The whole experience tells me that the stylists and bean counters have kicked the engineers out of the automobile industry, and the traditional American auto makers will soon become extinct. Once auto makers (and sadly, many other American industries) begin to design and build useful and reliable products, the US will again become competitive in the world's markets.