It Takes a Movement to Save an Auto Industry

The key reforms of the New Deal--Social Security, the Works Projects Administration, the Wagner Labor Relations Act, higher minimum wages--didn't come about simply because FDR was elected and surrounded himself with smart advisors. They also came about because there was an active and militant labor movement pushing FDR and Congress to act.

Likewise, LBJ didn't wake up one morning and decide to spend a good part of his political capital to get the Civil Rights Act passed. The Civil Rights Act was preceded by a decade of a mass civil rights movement marching in the streets, staging boycotts, registering voters, and committing civil disobedience. There was a creative tension between the JFK and LBJ administrations and the civil rights movement--and often anger as well--but this creative tension between Washington politicians and a mass movement is what ultimately drove fundamental change.

This is no less true today. It's interesting to try to read the tea leaves to guess how centrist or progressive Obama will be and to speculate how his super-smart, and largely centrist advisors will influence his direction. But the Obama administration is likely to be more progressive and less centrist if there are organized movements pushing him in a more progressive direction. Obama--the ex-community organizer turned professional politician--certainly understands the sophisticated play between elected officials and popular movements in determining how far elected officials will go to bring about change.

Which brings us to the auto industry. Allowing the auto industry--with its deep interconnections to other businesses such steel and rubber, parts suppliers, and car dealers, which employ 3 million Americans--to go bankrupt would be disastrous for the nation and could push the recession into a depression. But the auto industry, like much of the manufacturing sector where employees shower after work instead of before work, seems to have lost the political clout it once had.

When Citigroup's management screws up, Bob Rubin can spend the weekend on the phone with Tim Geithner and Hank Paulson and walk away Monday morning with $20 billion in Federal bailout funds and $340 billion in guarantees for toxic assets with almost no strings attached--No need to show a plan for Citigroup's long-term viability. Not so with the auto industry.

There's no question the auto industry has been mismanaged, but no worse than the Wall Street masters of the universe like Citigroup, AIG and Bear Stearns have mismanaged the financial service industry, helping cause the current economic meltdown which threatens the homes and jobs of tens of millions of people in America and around the world. But when the auto industry asks for federal help to stave off bankruptcy and save 3 million jobs, politicians and the media demand detailed plans for fundamental restructuring and major give-backs from its workers and unions. It's not that there shouldn't be strings attached to federal bailouts. It's that there's a major imbalance between the ways businesses that make physical things we actually use and businesses that manipulate money are being treated.

To save itself, the auto industry, and particularly its workers, may need to dig deep and rediscover its tradition of militancy and political theater. The CEOs of the Big 3 clearly have a tin ear for political salesmanship. Flying to Washington in their private jets was a bone-headed move (although I never saw politicians and media pundits demand that investment bankers receiving Federal bailout funds give up their private jets and company-paid country club memberships). And doing penance by driving 900 miles back to Washington in hybrid cars doesn't seem to have done the trick in turning around Congress and public opinion.

So here's a better idea--picture a massive caravan of thousands of people effected by the auto industry snaking from Detroit through Michigan, Indiana, Ohio and Pennsylvania to Washington, landing up in front of the Capitol demanding action to save their jobs and staying there until Congress acts. It would be made up of blue and white collar autoworkers, steelworkers, rubber workers, owners and workers from small business that supply auto parts, owners of car dealerships and salespeople who work there, waitresses from the corner café or bar next to factories and showrooms where people go for a burger or a beer after work or shopping for a car. Let the American people, the media and Congress see the faces of the people who would lose their jobs and their homes if the American auto industry goes bankrupt. And then let's see if Congress tells them all to "drop dead".

That's the kind of mass action that helped build the American middle class and that created the political and economic conditions in which someone could graduate from high school, go to work, earn enough to support a family and buy a modest house, and maybe send their kids to college so the next generation could do better than the last. It may take that kind of mass action again to preserve that American dream.

I received a fundraising email with the following quote: "Rosa sat, so Martin could walk. Martin walked, so Obama could run. Obama is running, so our children can fly." Maybe we need to sit, and walk, and march again if we and Obama together are to be able to help our children fly.

Read More:

Should the Government Bail Out the Big Three U.S. Automakers? HuffPost Bloggers Weigh In

Comments

[kstuff]

Where do I sign up?

[Biffmeister]

That's interesting innovation ppthebody , not certain how well it would work. As far as manufacturing non automobile items, my guess is that they should proceed with all due speed in the manufacture of high mileage/electric/hybrid cars. According to the Rocky Mountain Institute they have the basic technology and just need to get it going on it.

[Biffmeister]

Blue collar workers who actually produce a commodity are apparently not worthy. My understanding is that unlike the foreign car manufacturers who merely assemble pieces manufactured elsewhere, the big three are directly connected to the manufacturing of the parts. The repercussions to the economy would be huge.

[ATruthBeKnown]

The problem is these companies are full of good ideas. The management (rich in their glory) isn't in the business of innovation. They are interested in protecting their respective butts. I think if we got the management out of the way these companies could and would take off.

Where is Lee I. when you need him.

[Biffmeister]

Last sentence should read "Should the big three fail, the repercussions to the economy would be huge."

[ppthebody]

Other question: what materials and/or parts can these auto makers quickly and efficiently convert their plants to make? We need to expand our infrastructure. Can Ford, GMC, and Chrysler make parts for railroads, power lines, or bridges? They use steel right? Force Detroit to become distributors/middlemen for industrial parts used to expand the infrastructure. Again, present lump sums to Detroit, not as loans or giveaways but as debits against unearned income and undelivered product.

[squeakyf]

I work at the Ford Assembly Plant in Claycomo (Kansas City, MO) and the response to you question is Yes. KCAP (at a different location in KC) built airplane parts (wings I believe) during WWII. The platforms and assembly parts are still stored at or close to the plant so that should there be such a need, the change could be made. Now are these items outdated? Of course, but in theory, it (change) can happen. Just some ol FYI for ya.

[ppthebody]

Social movements become moot if fueled purely by good intentions. The government or these seemingly idiotic CEO's need innovative, intelligent solutions with at least some modicum of logic. My question is this: how many cars are leased (and/or bought) by the Federal government or with Federal taxpayer dollars? If the U.S. Federal government (FEMA, Homeland Security, Interior, etc.) buy or lease 1,000 cars (thus replacing their current fleet) and the car makers were selling cars for $1,000, it would equal $1,000,000 dollars of money the U.S. government could give to Detroit as unearned income to be exchanged for hybrid autos sometime in the future (2010, 2012, etc.). 1,000 cars X $40,000 (MSRP) equals $40,000,000. OK, $40Million is not that much. Let's expand it to State governments. Have the state governments buy through the Federal government (acting as a distributor) who pays Detroit. If each state uses 200 cars statewide (that's 200 X 50 = 10,000 X $40,000 (MSRP) = $400, 000, 000). Still not all that much, but again, you get the point. The U.S. government would not buy at cost, they would pay retail, which means Detroit would have $440,000,000 in retail sales, not as loans to be paid back in full, but making profit on the sales and retaining jobs. But the U.S. government could give it to them at this very moment.