the Wall Street Journal's online opinion site, Michael Barone postulates that the impending failure of GM is due to
<cue scary music> the unions and their socialistic intentions. Marx gets his name dropped in the same breath as
the UAW's former president, forcing one to wonder if some corollary to Godwin's Law should be invoked.
What Barone somehow fails to explain is how the Big 3 were overcome by manufacturers who also employed well-paid unionized labor. Workers for Japanese companies weren't exactly paid peanuts, VW kicked ass in the small-car market for a couple of decades using labor that was likely better-paid than UAW workers, and a quick glance at South Korea shows a country that embraces labor unions and long-term commitments to workers.
Now, I?m not trying to organize some sort of group hug for the UAW, since one can point at that particular union?s resistance to change as a huge factor behind the Big 3?s inability to change with the times. But let?s make the root cause clear and work our way outward, instead of laying vague blame on benefits such as health care and retirement pay that many of us expect to receive in a modern society - it all comes down to product. Face it - had the US car industry been able to better adapt itself to changing customer demands, the most we?d be hearing about from Detroit with regards to health care, pensions, and so forth would be a bit of mild grumbling about reduced profitability.
I think it?s telling that in the past 30 years, it?s possible to point to exactly one American mid-sized car that history might consider to be revolutionary (that?s the Taurus, for those not paying attention). A few more hits like that might have done a much better job of funding pension and health-care commitments. Do those commitments currently pose an obstacle to product improvements? Quite possibly, but I feel that certainly wasn?t the case until quite recently.
Interestingly enough, I was pointed to this article by Glenn Reynolds? Instapundit blog. In Reynold?s Slate/MSN column this week, he posts reader feedback to an article he wrote on GM?s situation a few weeks ago. The blame there is, shall we say, a bit more balanced.