  Mayor_sekou Member Username: Mayor_sekou Post Number: 834 Registered: 09-2006 |
Why America should care about Detroit Posted Today 09:20 AM by Angus MacKenzie Filed under: Editorial, The Big Picture Okay, this might be a bit of a stretch, but for a moment let's just suppose GM, Ford and DaimlerChrysler have figured out exactly what they needed to do to get out of trouble. Would Motown's glory days be back? Nope. Here's why: America doesn't really care whether it has an auto industry any more. Let's start at the top, shall we. It took George Bush almost six years to get around to meeting the three Detroit CEOs. Sure, the President is a busy man. But even last year's American Idol contestants got face time in the Oval Office before the guys who run businesses that directly employ hundreds of thousands of Americans, indirectly benefit millions more, and generate billions of dollars worth of economic activity every year America's auto industry ain't much of a priority over on Capitol Hill, either. The Washington-mandated CAFE rules simply transformed Detroit's automakers into truckmakers as they exploited loopholes to meet the demands of consumers enjoying cheap gas. The cheap gas bubble has burst, never to return, leaving Detroit tooled up to build precisely the wrong kind of products for a carbon-constrained world, but no politician talks about finding ways to get out of that mess. Back in the 50s and 60s, you'd find the masters of the universe on Woodward Avenue, not Wall Street. Detroit used to attract some of America's best and brightest, but to today's college kids manufacturing is, like, so yesterday. In 2001 only seven percent of all bachelor degrees in the U.S. were in engineering, compared with 18-20 percent in countries such as Germany, Italy and Japan. By 2010 China is expected to be awarding more engineering doctorates than we are. You won't be surprised to learn we produce more lawyers than any other country. Manufacturing - led by automaking - used to be the engine room of the American economy. Back in 1950 manufacturing accounted for nearly one-third of the U.S. gross domestic product (GDP), the term economists give for the total market value of all goods and services produced by a country. By 2003, however, manufacturing had slumped to just 12.7 percent of GDP, leaving it a distant second to the financial services sector, which accounted for 20.4 percent. In other words, the main business of America now is simply moving money around rather than actually making stuff. Does that matter? You bet. America needs a vibrant, viable auto industry, because if you know how to make a car (still the most complex and costly mass-produced item in the world) you know how to make a lot of other stuff - everything from air conditioners to aircraft carriers. It's one of the reasons newly industrialized nations race to establish an auto industry of their own, even though the costs are huge and there are already too many auto factories making too many cars. Just look at what China is doing. What Germany is doing is more relevant to the U.S., though. According to estimates in the CIA World Factbook, the world's largest exporter in 2006 was Germany, with exports totaling $1.133 trillion. That was $109 billion more than we managed, even though we have almost four times the population. Most of Germany's exports were manufactured goods. Stuff made by Germans in Germany, including a lot of Mercedes-Benzes and BMWs, Audis and VWs. Of course, the total value of Germany's exports will soon be swamped by those of third placed China, a country with more than 10 times the number of people and a rapidly expanding industrial base built on cheap labor costs. But the real point is Germany's export earnings (worth about $13,800 per citizen, four times more than the U.S. figure) come from a country with wages, benefits and production costs as high, or higher, than those right here. So why can Germany do what we can't do? Because in Germany, making stuff is still important. Some economists will argue that America is moving towards a post-industrial age; that we don't have to make stuff because we can simply buy everything we need from the profits generated by the finance-driven economy. (For the record, Germany's 2006 exports were worth $217 billion more than its imports, while U.S. exports were worth $845 billion less than imports. We're sure buying a lot of stuff.) Maybe those economists ought to read a little history, because three other countries - Spain, Holland and Britain - all once dominated the global business of moving money around like America does now, and subsequently slipped into decline when they forgot the importance of making stuff themselves. That's why America should care about its battered and bruised auto industry. http://blogs.motortrend.com/62 07244/editorial/why-america-sh ould-care-about-detroit/index. html A lot of stuff we already know but maybe the rest of the world doesn't, anyone disagree? BUY AMERICAN!!! | ||
56packman Member Username: 56packman Post Number: 1280 Registered: 12-2005 |
Mayor, your honor--I knew the gig was up when LaSalle bank was being sold for three times as much as Chrysler. A freakin' bank, a bunch of branches with laon officers, tellers and ATMS running out of some central office is worth more than all of Chrysler, with plants that employ tens of thousands of people? Years ago the bank was Chrysler's bitch! | ||
Lilpup Member Username: Lilpup Post Number: 2106 Registered: 06-2004 |
Comment #5 in response to that blog is the typical American attitude toward Detroit. The west coast in particular bows down before the rising sun. | ||
Ramcharger Member Username: Ramcharger Post Number: 247 Registered: 05-2006 |
The U.S. displays many the classic symptoms of a civilization in decline; a slowing birth rate and an aging population, a military stretched to the breaking point, huge trade and budget deficits, an increasing portion of its’ wealth concentrated in a smaller percentage of its’ citizens and a decreased reliance on manufactured goods as the basis of our economy. For generations Detroit has been the canary in the coal mine for the U.S. economy. The canary is now gasping for air and no one is paying attention. Our business leaders are blinded by greed and our political leaders are either too stupid to see what’s happening right before their eyes or too inept to do anything about it. It’s only a matter of time before the rest of the country succumbs to the same recession that now afflicts Detroit. Unfortunately, by then it will be too late to do anything about it. | ||
Iheartthed Member Username: Iheartthed Post Number: 731 Registered: 04-2006 |
Actually, there have been a few economists sounding the alarms about production not keeping pace with the creation of wealth in this country. You've got all these 29 year old multi-millionaires walking around here on Wall St but from doing what? Moving money. If/when the correction comes, it's gonna be a nasty one. Also, towards the end of last year, either Bernanke or Greenspan (can't remember which one) wrote an editorial sounding the alarms about the widening wealth gap. That's one of the most pressing issues facing the American economy in the future. I've heard murmurs of this place becoming the next Israel in terms of social services burdens (ironically, remember that article about the suburbs matching the city in Salvation Army requests yesterday?). | ||
Iheartthed Member Username: Iheartthed Post Number: 732 Registered: 04-2006 |
As an addendum, even NYC government officials have become very vocal about the disappearing middle class in the city and what it means about the future vitality. | ||
Cambrian Member Username: Cambrian Post Number: 1079 Registered: 08-2006 |
This post deserves the "Best Post of 2007" award. The writer of the article really gets it. He/ She is obviously the head of the class. Too bad only that class's dunces were the ones to get jobs on Wall street. | ||
Focusonthed Member Username: Focusonthed Post Number: 965 Registered: 02-2006 |
n/m (Message edited by focusonthed on May 11, 2007) | ||
Warrenite84 Member Username: Warrenite84 Post Number: 90 Registered: 01-2007 |
A lot of innovation comes from manufacturing. NASA is another area that adds to our know-how. We just give it away so now China, Japan and others can do what we do but with pennies of investment. If a knowledge based economy is what we are moving toward, you would think we would guard it with all our might. | ||
Kathinozarks Member Username: Kathinozarks Post Number: 462 Registered: 11-2006 |
ok, now I'm depressed. | ||
Waxx Member Username: Waxx Post Number: 152 Registered: 09-2006 |
If anyone's up on the history of Detroit, this city has contributed a great deal to this country. Case in point: The 1st (American) Automobile the 1st freeway the 1st shopping mall (Northland) the 1st suspension bridge (I might be wrong on that one) the 1st skyscraper (might be wrong there, too) and in spite of the fact that this great city of ours still rising from the ashes, as it were, there are still parts of it as Kathinoarks would put it, DEPRESSING! | ||
Jasoncw Member Username: Jasoncw Post Number: 362 Registered: 07-2005 |
You're a moron. You think Detroit invented the first suspension bridge? The first skyscraper? Also, I don't think we were the first American car makers either. | ||
Themax Member Username: Themax Post Number: 662 Registered: 09-2005 |
Barak recently said some things about the auto industry to the Detroit Economics Club. http://www.michiganliberal.com /showDiary.do?diaryId=8860 "We all know the statistic - health care costs currently account for $1,500 of every GM Car. So here's the deal. We'll help to partially defray those health care costs, but only if the manufacturers are willing to invest the savings right back into the production of more fuel-efficient cars and trucks." | ||
Nere Member Username: Nere Post Number: 4 Registered: 04-2007 |
I think it's a little sad that a thread about bakeries has more replies than this one... I think Detroit could be revived in the off-chance that we come up with a new kind of industry to focus on. | ||
Dds Member Username: Dds Post Number: 232 Registered: 10-2006 |
quote: Well, two out of five ain't bad. | ||
56packman Member Username: 56packman Post Number: 1293 Registered: 12-2005 |
The first American (production) car was manufactured by the Duryea brothers in Massachusetts, in 1896. News flash: Henry Ford did NOT invent the car or the assembly line | ||
Lilpup Member Username: Lilpup Post Number: 2138 Registered: 06-2004 |
No, he didn't, but he was smart enough to recognize where the mass market for autos was and worked hard enough to drive production costs down to achieve his dream of affordable cars for the working class. Prior to Ford cars were just toys for the wealthy. Add to that his higher wage scale and starting up of trade schools for kids, hospitals for workers, free English classes for immigrants, a mill system to provide farmers with extra income, etc. and the "Jew hating, union buster", as I've seen him labelled, did a hell of a lot for the working class around here. And he did it despite having to deal with Wall Street. Fat chance trying to get a company to be as progressive now (except maybe a non-traditional like Google). | ||
Rb336 Member Username: Rb336 Post Number: 53 Registered: 02-2007 |
How about this -- 1/3 of all US research occurs in SE Michigan | ||
Cambrian Member Username: Cambrian Post Number: 1081 Registered: 08-2006 |
"And he did it despite having to deal with Wall Street." Nope! Henry couldn't stand Wall Street whining about producing profitable quarters. He bought the company from the share holders about 1915? It was a privately owned entity until 1955? When HF2 made the company public again. | ||
Lilpup Member Username: Lilpup Post Number: 2139 Registered: 06-2004 |
Ah, perhaps that's true - he may have had stockholding partners without being publicly traded. | ||
Karl Member Username: Karl Post Number: 7413 Registered: 09-2005 |
Lilpup, just a guess - but it would appear that the wildly successful Japanese auto companies have both a non-union and a non-Jewish workforce. Perhaps Microsoft is the same? | ||
56packman Member Username: 56packman Post Number: 1294 Registered: 12-2005 |
Henry maniacally forced his early investors to sell out at his cooked-book value after the Model T took off and his financial future was assured. Two such shareholders who stopped and said "wait a minute, I think we got robbed" were John and Horace Dodge. They made a huge percentage of the early Ford cars, which Henry's man assembled. Whenever Henry couldn't make his bills to the Dodge bros. he issued them more stock. They took him to court in 1919 and won, walking out of the courthouse with a check for about $20,000,000. They went to the DAC, came in the door and said "drinks and food are on us". Later that evening when the waiter presented the bill they tried to pay with the huge Ford check. | ||
Crew Member Username: Crew Post Number: 1263 Registered: 02-2004 |
56pack remembers that night well and can still taste the Rob Roy he had that night at the DAC bar. | ||
Lilpup Member Username: Lilpup Post Number: 2143 Registered: 06-2004 |
But Couzens, a major stockholder and the one Sorenson thought would buck the $5 day, stuck with Ford until Couzens ran for office. quote:wtf is this meant to imply? | ||
Kslice Member Username: Kslice Post Number: 35 Registered: 04-2007 |
Racism... We cannot let the chinese beat us, because they are not free!!! They are a communist country! The global economy is just an excuse for ignorant people to buy japanese cars. American car companies help America, Toyota doesn't give a damn about you. If America had another depression would they care? NO, they'd just sell more cars in other places to replace your dollars. We need to beat japan and the rest of our competitors back into submission before it's too late. We need to start putting our own welfare first! | ||
Lilpup Member Username: Lilpup Post Number: 2145 Registered: 06-2004 |
quote: anything postable to back this up?? | ||
Quozl Member Username: Quozl Post Number: 602 Registered: 07-2005 |
According to nemw.org data from 2000, the WHOLE State of Michigan accounts for only 7.7% of the US R&D total. Only off by 25.3%, not too bad... | ||
Jerome81 Member Username: Jerome81 Post Number: 1439 Registered: 11-2003 |
Chicago had the first skyscraper.... |
