The death of GM and our future as “a civilized nation”
I’ve spent most of my adult life wishing that General Motors, who brought us the Hummer, would die and go away. Now it appears that day may be upon us, absent a massive bailout paid for by you and me. I’m not very happy about subsidizing their decision to build Hummers while the world’s oil reserves dwindled, but I recognize there are good reasons for keeping the company alive.
Here’s James Howard Kunstler, who writes and thinks a lot about sustainable communities and life in a post-oil age, introducing one good reason for keeping GM around:
Many Americans have already bought their last car — they just don’t know it yet. The current low-ish price of oil is a total fake-out, having to do much more with asset-dumping in the paper markets than the true resource supply-demand equation. Most of the world (the media for sure) has ignored preliminary leaks from the International Energy Agency’s (IEA) forthcoming report which forecasts global oil depletion to be 9.1 percent in 2009. This is a staggering figure, very likely to offset whatever slack we see in global demand from the worldwide economic crisis. In fact, the global oil markets are poised for the most severe dislocations ever seen, meaning it’s a toss-up what happens first in the USA: a major leg back up in oil prices, or shortages, hoarding, and rationing.
For my money (literally) there are only two main reasons that any portion of the car industry should be rescued at the present time: one, because we need somebody to manufacture engines for military vehicles, and two, because we need somebody to manufacture rolling stock for the revival in passenger railroad service that will have to be a centerpiece of the future economy if we want to remain a civilized nation.
If we really did use GM’s carcass to build a passenger railroad service that was worth something, I would have to say that keeping GM around was worth the money.
–Erik Ryberg
November 17th, 2008 at 10:00 am
GM in particular truly bothers me and deserves a long-deserved death. GM has consistently been making some of the least reliable cars. GM has consistently made some of the largest cars. GM’s success has depended SOLELY upon the idea that you are purchasing an All-American car and therefore are supporting your country, despite the fact that many of the parts and manufacture of said cars are indeed made overseas. Meanwhile, Honda, Toyota, and Hyundai all have manufacturing plants right here, in the USA.
Despite the clear signs that the consumer wants the exact opposite of these things, they continue their completely wasteful, non-innonative ways. What GM commercials have I seen in the last 6 months during the downturn of the economy? Why the Hummer TRUCK version, the Escalade hybrid, which still gets an unacceptable 20 MPG and also the “All-electric” Chevy Volt. The Volt, slated for sale 3 years from now, contains both a gasoline and electric engine thus making it a hybrid. However, GM tends to ignore this fact in advertising, misleading the customer in order to cash in on a “green” image 3 years before it is even released. Nevermind that GM made an ACTUAL all-electric car 10 years ago and scrapped the project to instead focus on monstrous trucks and SUV’s.
In short, the company has done absolutely nothing in the past 15 years to adapt to changing times and I for one will be extremely annoyed when they are bailed out and continue to produce terrible vehicles.
November 17th, 2008 at 1:52 pm
Giant terrible gas-guzzling vehicles like Opel? Saab? Saturn? GM offers several lines of big lumbering dinosaurs, and they offer several lines of smaller, more efficient vehicles – guess which ones sell like hotcakes, and which are more or less just niche-market appeal? We can rail against GM all we want, but in reality all they’re doing is supplying a product that their customers want. (Well, at least what they want when gas is cheap.) If they didn’t make the Hummers, Suburbans, Escalades, etc. – than somebody else will. I’m not certain this is still true, but the last I heard, GM was still the leading vehicle manufacturer in the world, with Toyota coming in second a good bit behind them. Perhaps that’s about to change, or even *has* changed already, but even so, civilian passenger vehicles are actually a very small slice of GMs total product, and I doubt very much that it is *that* division that is the problem – the sudden inability of *all* divisions corporation-wide to float large amounts of credit for the period of time between tool-up and final payment is the more likely culprit.
November 17th, 2008 at 8:56 pm
Actually we can let GM die and then get the factories at firesale prices and build railroad cars in a couple and bicycles in the rest of them…
November 18th, 2008 at 8:01 pm
Hi E,
I’ve been thinking about this for a while, and of course, I don’t care if GM dies.
What I’ve been thinking is WHY do railroads have such a bad rep in this country, yet do so well in Europe.
Here’s what I think — the railroads in this country were built on the highest order of grand larceny — the Railroad Land Grant Acts. This was in essence a ‘privatization’ initiative of what really ought to have been a public service prone to monopolization, not unlike current efforts toward ‘privatization’ that have led to forces like Blackwater, etc. The history of the railroads in the U.S. is filled with people being burnt out of their houses to build the railroad itself, and have led to a hidden cultural hangover regarding the trains themselves.
Contrast to Europe, where the railroads have been and currently are national entities and you have a very different attitude toward rail transport.
It’s made me believe that the best thing to do is let GM collapse, take it over, and nationalize all the railroads, and use the auto manufacturer’s factories to build solar power generators and rail cars.
I’m not holding my breath, but it’s all very interesting.
November 19th, 2008 at 11:33 am
Chuck,
I guess it’s a little unclear to me why it should make a difference in people’s attitudes whether they get forced out of their homes by a private railroad company that had the full backing and support of the US government, of if they had been forced out by the government directly. Especially considering government’s record of being far more heavy-handed in pursuit of what it wants than any private enterprise in history.
And haven’t the railroads already been “nationalized?” Yeah, I know – Amtrak is like the post office, it’s the government… but it’s not really.
November 20th, 2008 at 9:07 am
Hi Scott,
It’s a good subject for debate — but if there was a difference between the railroads and the gov’t, it was that the railroads didn’t discriminate when it came to burning people out of their homes — they did it to everyone. The gov’t only did it to minorities, or others out of the power structure.
And if there’s no difference, why not just privatize the military? There is a difference in behavior.
November 20th, 2008 at 12:26 pm
So are you saying that people would’ve been more accepting of the act of burning families out of their homes/ranches if the victims had only been minorities, or that government would’ve routed the railroads many expensive miles *around* all the white folks property?
I think the difference in attitude towards public transport (and a lot of other social issues) has a lot more to do with the fact that Europeans are just more inclined to obediently do as their government tells them. Nearly all of the malcontents, troublemakers, and people with authority issues have voluntarily purged themselves from polite European society over the last couple of centuries and, well, moved here to live as they please, distrust authority, and breed more malcontent offspring. That theory explains a lot of the differences between Europeans and Americans, and why things that work there, don’t work here.
And Obama just might be all over that privatized military idea, have you seen this video clip from a recent speech?
http://www.youtube.com/watch?v=UHmecy94z-M&feature=related
Seems like a mighty unusual thing for a Democrat to propose.
November 20th, 2008 at 7:25 pm
Hi Chuck, I think you have an interesting point but after ruminating over it a few days I’ve decided it is a difference without a distinction, if you know what I mean. I think you might be right about the way they were built (although I remember a passage in Middlemarch about the railroad taking farmers’ lands by force that was pretty powerful) but I think we Americans don’t have memories that are long enough to care about it. I think we don’t like trains because we can afford cars. Nobody wants to take the train when he can drive, particularly when he is bombarded with advertising that informs him how powerful, free, sexy, rich, beautiful, smart, and creative he is by doing so.
On the other hand, I took the train recently from Portland to Seattle and back and got off relaxed and cheerful and ready for a great day. The drive through the rain, by contrast, is pure hell and not much cheaper, though it is about 25 percent faster.
EBR
December 5th, 2008 at 11:34 am
If GM closes down I think i’ll be scared about the future the rest of my life.