Detroit-Washington Shotgun Wedding
American automakers are sinking fast in a quagmire of their own making.
It’s now pay-up time for automakers who hedged their bets – and a million U.S. jobs – on bigger, heavier gas-guzzlers, while thwarting demands to boost fuel efficiency and cut their unrestrained contributions to global warming.
Car sales have dropped more than 14 percent this year, and more than 100,000 people have lost their jobs in the auto industry over the past two years. General Motors is teetering. Merger talks with Chrysler were called off, and now there’s talk of bankruptcy.
GM executives are demanding yet another federal bailout, and again, there is no assurance that taxpayer assets would be used responsibly to keep the industry afloat. Some suggest GM should be allowed to go the way of any other poorly managed business.
The aider-and-abettor-in-chief of Detroit’s mismanagement has been George W. Bush’s White House, hell-bent on blocking environmental regulations and efforts to reduce greenhouse gas emissions. For the Bush administration, the Humvee came to symbolize America’s do-anything spirit.
Enter President-elect Barack Obama, with a bulging briefcase of promises to rebuild America’s diminished industrial base while also restoring a healthy environment.
Obama can now strike a bargain that could become the model for 21st century government intervention: bailouts for social and environmental responsibility. Economists could never have envisioned such a perfectly arranged marriage.
In exchange for feeding at the public trough, the auto industry would submit to a strong regulatory regime: no more multimillion-dollar marketing campaigns to gin up demand for monster-size cars and trucks; instead, they would be mandated to invest in green technology research and development, and show that each new model would meet a strict set of environmental and safety regulations. They would also commit to cleaner manufacturing and keeping jobs at home.
And from Capitol Hill comes word that Rep. John Dingell, D-Michigan, perhaps the most intransigent defender of Detroit polluters in the Democratic Party, may be pushed aside as chair of the Energy and Commerce Committee, thus easing the way for Congress to begin holding U.S. automakers accountable for their harmful behavior.
In the long term, such a bargain can demonstrate that social costs and opportunities can be factored into the productive process without forsaking an honest profit.
Brian Barger is a veteran investigative journalist based in Washington.
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