The end of the road for an American icon

Posted by AzBlueMeanie:

Monday's bankruptcy filing by American icon General Motors (GM) invoked a sense of relief rather than shock or sadness. The country has been sitting at the bedside of this terminally ill patient watching it slowly dying for decades now. Still, one could take little comfort in its final passing, and Americans are right to mourn its death. What was once a proud symbol of America will never be again.

GM has been part of the tapestry of American life for over a century. It built America's industrial towns, not just with its own manufacturing plants, but with the manufacturing that developed around automobiles to meet the growing demands for steel, rubber, glass and a network of parts manufacturers and suppliers, automobile dealerships, mechanical repair shops, gasoline filling stations, lenders of car loans, and auto insurance. These automotive related jobs supported a myriad of other service jobs (including the rise of "automobile culture" businesses like drive-thru and car hop fast food restaurants, motels, drive-in movie theaters, etc.) The 20th Century, the American Century, was also the Automobile Century. Our American popular culture was uniquley built around the automobile.

Automobiles turned America into an industrial giant with the industrial capacity to win a World War and to build an American middle class in the post-war era. And that middle class was made possible by the hard work and efforts of the United Automobile Workers (UAW) Union.

I was reminded of this history in an opinion by Harold Myerson which appeared in the Washington Post last December at the time Republicans were trying to kill any bailout to America's automobile industry and allow it to go into liquidation by its creditors, or to be sold off in pieces to foreing competitors. The United Auto Workers as the Architect of U.S. Prosperity:

In 1949, a pamphlet was published that argued that the American auto industry should pursue a different direction. Titled "A Small Car Named Desire," the pamphlet suggested that Detroit not put all its bets on bigness, that a substantial share of American consumers would welcome smaller cars that cost less and burned fuel more efficiently.

The pamphlet's author was the research department of the United Auto Workers.

By the standards of the postwar UAW, there was nothing exceptional about "A Small Car Named Desire." In its glory days, under the leadership of Walter Reuther, the UAW was the most farsighted institution — not just the most farsighted union — in America. "We are the architects of America's future," Reuther told the delegates at the union's 1947 convention, where his supporters won control of what was already the nation's leading union.

Even before he became UAW president, Reuther and a team of brilliant lieutenants would drive the Big Three's top executives crazy by producing a steady stream of proposals for management. In the immediate aftermath of Pearl Harbor, Reuther, then head of the union's General Motors division, came up with a detailed plan for converting auto plants to defense factories more quickly than the industry's leaders did. At the end of the war, he led a strike at GM with a set of demands that included putting union and public representatives on GM's board.

That proved to be a bridge too far. Instead, by the early 1950s, the UAW had secured a number of contractual innovations — annual cost-of-living adjustments, for instance — that set a pattern for the rest of American industry and created the broadly shared prosperity enjoyed by the nation in the 30 years after World War II.

The architects did not stop there. During the Reuther years, the UAW also used its resources to incubate every up-and-coming liberal movement in America. It was the UAW that funded the great 1963 March on Washington and provided the first serious financial backing for César Chávez's fledgling farm workers union. The union took a lively interest in the birth of a student movement in the early '60s, providing its conference center in Port Huron, Mich., to a group called Students for a Democratic Society when the group wanted to draft and debate its manifesto. Later that decade, the union provided resources to help the National Organization for Women get off the ground and helped fund the first Earth Day. And for decades after Reuther's death in a 1970 plane crash, the UAW was among the foremost advocates of national health care — a policy that, had it been enacted, would have saved the Big Three tens of billions of dollars in health insurance expenses, but which the Big Three themselves were until recently too ideologically hidebound to support.

Narrow? Parochial? The UAW not only built the American middle class but helped engender every movement at the center of American liberalism today — which is one reason that conservatives have always held the union in particular disdain.

Today you will hear the corporate apologists assert that unions were the reason for the death of GM, but don't believe these corporate apologists. GM in the post-war era was one of the wealthiest and most powerful corporations in the world — GM came to see itself as more powerful than the governments in the several countries in which it was located and operated. It could run roughshod over the U.S. Congress with the help of powerful politicians whose districts were dependent upon GM. It became a power unto itself. This gave rise to a corporate culture of extreme arrogance and abuse of power. It was this corporate culture, like a malignant cancer, that slowly gnawed away at GM over the decades before finally consuming its host.

Had GM listened to and incorporated the innovative ideas proposed by its work force and the communities in which it was located instead of actively opposing them at every turn, GM would have survived and thrived and not be in bankruptcy today. Many of America's industrial towns like Flint, Michigan would not be blighted ghettos or abandoned ghost towns today. America's middle class may have continued to expand and thrive rather than contract and decline since 1973. With healthy communities and an employed work force invested in their communities, the American economy would be stronger today. And America would have a stronger society today.

So it is with great cynicism that I listen to these corporate apologists who whine that we can't have government or the unions making management decisions at GM during this bankruptcy, that we must have experienced corporate management in place who know how to run a car company. The corporate apologists, of course, mean the very same managers who ran one of the most successful corporations in the history of the world into the ditch and into bankruptcy with their supposed superior knowledge of how to run a car company. Nothing says success like failure to one of these corporate apologists.

If GM is to be saved from itself and reemerge from bankruptcy as a smaller, leaner and profitable company with a future, it must first rid itself of the malignant cancer of its corporate culture and infuse itself with new blood and new ideas and a new way of doing business in partnership with its work force and the communities in which it is located, and be more responsive to the needs of its customers.

Then, and only then, will GM have the opportunity to realize the name that it has given its corporate headquarters — Renaissance Center (pictured above) — if it has not already sold its headquarters to a competitor before then.