The Human Conspiracy Blog-space

In the children’s’ nursery rhyme, Humpty Dumpty was a giant, sentient egg that, having fallen off the wall, could not be reassembled by a team of government horses and men.

It’s the perfect metaphor for the American automobile industry.

Generous Motors is the Terry Schaivo case writ large. 

Ironic, isn’t it?  The liberals ridiculed the social conservatives’ obsession with a judge’s decision to pull life support from a brain damaged patient.  Now the conservatives are ridiculing the liberals in their obsession with attempts to resuscitate another patient on life support. 

We should not be talking about resuscitation of the almost-dead, but recovery of a garden.

The American automobile industry is a complex ecosystem, much like a garden of imported organisms, ill suited for the current growing conditions and artificially supported by a system of “climate adjustments”.  I’m taking about plant nutrients, artificial rainfall, supplied heat in the winter and air conditioning in the summer, that sort of thing.  Except that the federal government - in its infinite political wisdom - has been supplying air conditioning in the winter and a furnace in the summer...

So here is the single most radical solution yet proposed:

Let the U. S. automobile market adjust itself to natural conditions.  The same organisms will not grow in the same abundance?  Good. Eliminate all of the distorting climate adjustments – in the form of government imposed edicts about how to run the car business.  And do it yesterday.

Of course there is the problem of the weeds and pathogens, and the need to continue the water supply during the transition.

The water supply is ongoing credit.

The weeds and pathogens include antiquated union contracts, hidden subsidies to foreign competitors and the unbearable legacy costs of an antiquated and burdensome pension system.  Unless there is a bankruptcy or two (and I’m agnostic about whether that would or would not be a good step right now), the union contracts will not (and should not) be abrogated; they will simply die a natural death during renegotiations.

Now, I’m no heartless fool. Fixing these things will require federal help. For example, we will need to remove or ameliorate the burden of pension obligations without cheating the pensioners.  This will require federal subsidies and a completely revamped pension system, replaced by a new one for current and future workers that no longer provides defined benefits and encourages workers to stay in the game much longer than the present system does.  But that is another thorny topic for another rainy day.   

Here’s what can be done right now with little or no actual appropriated federal money (but not without “revenue” costs, of course – I’m not that naïve!):

(1) Repeal the complex and outmoded tangle of laws and regulations that govern the automobile dealership and parts supply networks.

(2) Repeal the anti-trust laws as they apply to the American automobile industry for at least 15 years. [Anti-trust laws presume that we need to take steps to preserve competition.  We’ll be lucky to emerge with a single American car manufacturer able to compete on the world stage.]

(3) Provide a 100% investment tax credit for all product innovation, manufacturing relocation and retooling (within the US).

(4) Freeze all safety and environmental regulations at their 2004 levels for 8 years. There would only remain voluntary compliance for all the newer requirements as market conditions permit. [the market is already safety and environmentally driven.  Bureaucrats are just getting in the way and adding costs.]

(5) Forbid all private-citizen class action suits against American car manufacturers (allowing for cases brought by state attorneys general only).

(6) Pass a national “right to work” law specifically applicable to the US automobile industry for the next 15 years. [No we’re not eliminating the unions, just making them work for members.]

(7)Tie the corporate income tax for American car manufacturers to the lowest number for any foreign nation that sells cars in the US. [this does not fully level the international playing field, but it’s a healthy start.]

The market place works.  The critics of the free market are playing a game: Clog the market with a network of impossible barriers, distortions, subsidies and regulations to the point that it fails, then make the claim - “See! Capitalism has failed once again!”

Free market economics represents are elementary ecological principles applied to commerce.  Where are the really smart environmentalists when we need them?

JBG