The Big Three Uniquely American? My Eye!

Ilana Mercer, December 12, 2008

Americans oppose a Detroit bailout by 61 percent to 36 percent. Nevertheless, their elected representatives in Congress passed it. That’s how democracy works. Representatives are elected not to uphold the Constitution and the limitations it places on power, but to pass lots of laws, some of which their constituents will like; others they will dislike.

Small mercies, the bailout billions to Ford, General Motors and Chrysler will likely croak in the Senate due to Republican opposition there. Senate Republicans, who’ve approved trillions toward the “rescue” of the mortgage and financial sectors, oppose this latest transfer of fiat money from government’s empty coffers to the empty coffers of the car companies.

As far as I can tell, the appointment of a car czar has stuck in the collective—and collectivist—craw of the Republicans, not because they reject the nationalization of Detroit by President Bush, “Congress and the Sierra Club.” Rather, the overweening and reckless Republicans would like their car-czar apparatchik to have more powers than Democrats are willing to give him. To wit, Judd Gregg (R., N.H.) expressed the fear that instead of a czar; he’d get “a little Caesar.”

Whoever said Republicans don’t think big—Big Government.

However, if Democrats get their wastrel, wayward way, what will come after a car czar? A People’s Car like the Russian Lada? The Lada was the mobile scrap metal manufactured by decree of the former USSR’s Ministries Council. Or will Senator Harry Reid order us to relax. After all, things Russian have been in vogue in America for some time. As The Economist quipped, America has already had a drug czar, a war czar, a bird flu czar, a bank bailout czar, and, soon we’ll have a climate czar, who’ll attempt to control the weather.

Besides, or so we’re lectured, the automobile industry is a “uniquely American” industry; its workers more American—and, hence, more deserving—than the rest of us. Since equality before the law is no longer apple-pie, I’d like to know what’s so quintessentially American about a failing industry. If anything, failure is un-American.

Detroit is circling the drain because its uniquely American workers and their union bosses have extorted from the car companies pay that exceeds their productivity. The Big Three sell cars, perhaps as many as their Japanese competitors; they just lose money on each sale, due to the cost of their uniquely American workers and their syndicate, the United Auto Workers.

How uniquely American is a $75.86 hourly compensation package? How many un-uniquely American workers are rewarded to the tune of $133,000 a year? The truly American (because productive), local workers of Toyota and Honda cost their employers, all told, $44 an hour. The Bureau of Labor Statistics puts the average hourly remuneration for regular Americans, benefits and all, at around $28.50. The workers of

The Big Fat Three are unique alright; they’re freaks of industry, as they receive 150 percent more in compensation than the average, American working stiff. The UAW mafia has also managed to extort what are known as “legacy costs” in lieu of health care and pensions for millions of its current and former workers. The “cradle-to-grave” care, courtesy of the car companies is as unmatched as it is unsustainable.

If sated and spoiled is American, then the beggars of the Big Three are American. If gripping business in the vise of union-imposed entitlements and government regulation is American, then Detroit’s auto-industry is it.

On the topic of pensions and perks in perpetuity, once established, a new government position is seldom, if ever, eliminated. The car czar and his cronies will be here to stay. The new fiefdom will feed off the few, remaining, real American individuals and industries.

Still, in czarist America, government alone can correct an (allegedly) errant market. After all, there is nothing like the inverted, perverse incentives that govern a government department to inspire industry. The more (fiat) money the new fiefdom devours—the more it fails and flails in its task, which it will—the greater the bailout it, in turn, can give itself.

December 12

CATEGORIES: Business, Economy, Federal Reserve Bank, Political Economy, Socialism, Technology

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