The Chris Moeller Archives

Dave got played

The carmakers still don't get it. Last night, General Motors sent some guy on "The Late Show with David Letterman" to talk about the state of the auto industry. It wasn't the president or CEO of the company. It was Bob Lutz, who's listed as a Vice Chairman. Lutz is 77 years old, retiring later this year, and, based on his conversation with Dave, spends much of his life already piloting airplanes. He came across to me as more of a Vice Chairman-Emeritus sent on national television by his boss to play the role of the rugged Korean War vet able to communicate to the American consumer some marketing department-manufactured "straight talk."

During the interview, Lutz conceded that the auto industry had made mistakes-- this fact would have been hard for him to dispute-- but he pinned most of the blame for the industry's woes on government regulators. (According to his Wikipedia entry online, Lutz once called global warming "a total crock of shit.") After powwowing with Dave over a mutual interest in classic American muscle cars (Lutz spearheaded the development of the Dodge Viper back when), the guest claimed that Americans have always desired a vehicle with the powerful V-8 engine. This, he says, is because the U.S. has traditionally enjoyed $1.50 to $2/gallon gasoline, compared with $6 or $7 per gallon in Europe. Then he implied that that was still the case today now that last year's record-high gas prices have come back down.

Do the stock-price assassins in the GM boardroom really still believe that Americans are looking for a V-8, high-performance engine under the hood? Are the American people really the ones to blame? This is how I connected the dots of what Lutz was saying. But this idea is laughable. If it were true, General Motors wouldn't be broke. Detroit has given us plenty of big engines to choose from over the last three decades, and Americans have treated these cars like the ugly kid at the prom.

American automakers like Lutz still have their heads in the sand, and continuing to keep their companies solvent with your taxes and mine is a fool's errand. For decades, they've rejected calls for more fuel-efficient vehicles. They've fought-- and quite astonishingly, still continue to fight-- legislation that would raise the national efficiency standards for the road (or that would allow individual states to do the same). Then, despite having eliminated nearly all of their domestic manufacturing jobs over the years, they continue to insist they're too economically-vital to the nation to be allowed to fail.

If you'll permit me to make myself unambiguous: Let 'em fail. If their executives still think that it's only government regulators and not consumers that want greener engines, their hubris is off-the-charts dangerous. As taxpayers, we can force restructuring of the industry-- with the laborers taking over ownership of significant portions of the new companies-- and start building the efficient cars Americans want to own and drive. We're not getting any of this now in return for our bailout payments.

Unfortunately, the restructuring that will take place will look nothing like this. Congress ceded restructuring authority and oversight to the Executive branch, then the Executive delegated it to an unelected and largely unaccountable task force comprised of cabinet officials and high-level appointees. The people are being shut out as we're once again asked to simultaneously trust the new president's best intentions and foot the bill.

posted by CM @ 8:44 PM