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The chronicles of a Do-Dah

Contributed by: Francis Miller on 7/20/2006

At the Detroit Auto Show, CEO, Rick Wagoner of General Motors, said that "GM has been number one in the market for 73 years and you can count on us being around another 73 years". Whoa, boy, Whoa!!!

Now, I have owned several Chevies and own three cars made by General Motors subsidiaries and wouldn't buy another one if bent over a barrel and threatened with a beating. So, this comment struck me as the ramblings of a corporate "do-dah". But, I let the matter go and went on to more important things like gardening and worrying about immigration. Then, this week, there was an interview with Rick Wagoner in Newsweek. Essentially, he said the board is tickled pink with his turnaround and doesn't think Kirk Kerkovian is out to get him. Isn't denial a wonderful protective mechanism? If Wagoner knew what the Board had in store for him he would probably be out buying a flexible tail pipe hose to use in his garage.

Here's my open message to Rick Wagoner. Let's start with the product. Let me be kind by saying that it is less than optimal. Anyone who owns a GM product for more than five years will experience doors sagging off their hinges, components engineered to fail, dealerships which are predatory, dashboards which fall off, just after the knobs fall off. Your cars have always commanded a premium and I am no longer willing to accept that you have now fixed the problems and that is all in the past.

The automobile and its associated industries of petroleum, highway construction and financing have been central to the irreversible transformation of the US from an agrarian culture to an industrial society, all in slightly more than 100 years. That has given ample time to R & D the next generation of power plant to move us forward into the 21st century. But, GM has not done that and has been a laggard. The profits accumulated have gone to investors and employees indulged and now society must either wait for a breakthrough from someone working inside his garage. In the meantime, thousands of young men and women will die and be maimed fighting to maintain a paradigm promoted by GM.

GM is all that is both good and bad about society. It has meant a higher standard of living for customers and employees alike, but the hostile co-dependency is now threatening an earlier way of life. The Japanese are eroding market share steadily, year after year and the Chinese and Indians, along with the Koreans are waiting in the wings with products that will likely be sold at Wal-mart and Costco. GM and Ford are not going to be turned around and their assets will either be absorbed through som last minute mergers or written off, if the Japanese see no use for sites surely contaminated over the years and equipment designed for an earlier age.

It is hard to judge whether all of this is good or bad. The consumer will buy what he perceives is best, irrespective of its impact on the balance of payments. Surely, some of those Toyotas and Hondas will be made with non-union labor in the US, so all is not lost. Government, which now relies on gasoline taxes will not do anything to hurt big oil and cars and trucks need highways to run on, so everyone at Exxon/Mobil and Peter Kiewit can breathe easy.

I remember as a child riding in the car with my parents through towns in Montana and Wyoming that were dedicated to coal mining. Men with sorry, pitiful looks sat on the front steps of their shacks and little kids ran around with narry a stitch of clothing on. Women, doing the wash, looked 60, even though most of them were in their 30s. I suppose that is the fate of manufacturing workers structurally displaced from the economic base that our country relied upon from 1890 to present. You can't go back to the farm, and Walmart needs only a few greeters. So, it is a social burden that the rest of us will have to fund to keep these people and their families from melting down in front of our very eyes. I just hate to see their faces pressed up against the glass window when I am eating sushi.

The real betrayal, of course is a system of corporate governance and government policy-making that milks short term rewards at the expense of the long term. While governments and corporate leaders burn the mid-night oil in Singapore, Dubai, Hong Kong, Bangalore, and a dozen other places, we are steeped in the soothing embrace of our denial.

The demise of Rick Wagoner and GM, like the Enrons, World Coms, Tycos, and a hundred other mismanaged enterprises, some of which will likely include Sun, Microsoft and Intel as their brethren at a later date can be judged as either tragedy or comedy. To be a bona fide tragedy, the players must be of high moral character before their downfall. In the case of most political and mercantilist actors, that is a stretch, since most of them treat everything around them as an extractives industry and would be amoral at best, if not downright immoral. So, that makes it a comedy. In the case of Enron it is a melodrama. How bizzare that Ken Lay would live on Shady Lane in Aspen and die right after being convicted? Could you write a better script? Maybe he will be seen riding in a Cadillac convertible with Elvis.

I for one, believe that we live in time of discontinuity, an age of unreason, and all bets are off about the future. Terrorism, natural disasters, destruction of the ice caps, economic downturns and a doze other possible scenarios make the future a fuzzy uncertainty, but the linear extrapolation of the future highly unlikely.


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CONTRIBUTOR INFORMATION

Francis Miller

Parker , CO

Francis Miller has posted 699 stories and 9 comments since joining on 11/17/2005. Francis Miller's average story rating is 4.2.
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