Rick Wolff: GM -- The system strikes back; Michael Moore: `Convert the factories to build trains, buses, windmills'
By Rick Wolff
June 5, 2009 -- The greatest tragedies among many in the collapse and bankruptcy of General Motors (GM) concern what is not happening. There are those solutions to GM's problems not being considered by Obama's administration. There are the solutions not being demanded by the United Auto Workers Union (UAW). There are all the solutions not even being discussed by most left commentators on the disaster. Finally there are crucial aspects of GM's demise not getting the attention they deserve.
Let's start with an example of the last. For 50 years, the world market for automobiles has grown spectacularly. The company best positioned to have ridden that rising tide to success was GM, the global market leader for most of that time. Instead, GM failed catastrophically. Those responsible, who planned, adjusted, and competed poorly, have a name. They are the corporation's Board of Directors: the handful of individuals chosen by and responsible to the handful of major GM shareholders. That Board and those shareholders proved across decades that they lacked the understanding, vision, and flexibility to succeed. A rising tide is supposed to lift all boats, but GM's captains managed to sink its boat.
President Obama promises not to interfere in decisions of the next post-bankruptcy GM Board of Directors despite the government being GM's largest shareholder. He further promises quickly to sell the government's shares to "re-privatise" GM (he promises the same for collapsed banks, insurance companies, and other corporations revived by infusions of taxpayer money). Obama's plan returns decision-making to the same Boards who just brought us the worst economic crash in 75 years.
GM's bankruptcy cuts employees and the wages and benefits of remaining workers. That will further damage already reeling Midwestern states dependent on the auto industry. Were our culture less subservient to capitalist interests and mentalities, the government would have developed -- years ago, but certainly during the last crisis-ridden year -- major plans to maintain employment and the regional economy by converting closed auto plants into, for example, production of ecologically sensitive mass transportation systems. That would be a growth industry as many regions seek to reduce the ecological damage from private automobile-based transportation systems. Obama supporters talk about such things but his administration does not do them.
Likewise the government might have developed programs to utilise closed plants, warehouses, and showrooms to help laid-off workers organise and operate their own enterprises. For a tiny fraction of the billions given to banks, the government could finance such workers using their skills, their largely untapped managerial capabilities, and their knowledge of and commitment to local needs. This, too, is not happening.
The UAW no doubt accepted the horrific terms of Obama's GM bankruptcy plan because otherwise bankruptcy threatened even worse for workers. It was "the best deal possible in the circumstances." However, those circumstances could have been different if the UAW and its allies had fought for them earlier. Suppose, for example, that the UAW, other unions, and the political left had fought for and won laws obligating the government to finance massive investments in new enterprises (producing new things and organised in new ways) whenever private capitalists laid off workers in large numbers. Then the UAW would not have had to accept the sort of horrific deal Obama and GM just pushed on them. UAW workers would have refused because they would have known the government was obligated to provide them with new jobs, enterprises, and new supports if a bankrupt GM fired them. The government's costs of bailing out GM through bankruptcy would have had to include the expenses of providing the new jobs and supports to fired workers. The government might then have put heavy pressure on GM for a bailout with many fewer lost jobs. In any case, if such laws had been won, UAW members laid off in a bankruptcy would not face unemployment nor would their communities face the devastation now underway.
The point is that nothing in the Obama-GM tragedy was necessary or unavoidable. The political struggles not undertaken and the laws not passed created the circumstances that drove UAW capitulation to the Obama bankruptcy as their least awful option. Knee-jerk apologists for the status quo are wrong to dismiss talk of what might have been. What might have been -- but was not won or even fought for -- determines today's mass sufferings as the GM tragedy unfolds. Without past labor-left alliances struggling for laws such as the example above describes, the way was cleared for GM and Washington to devise a choice for the UAW that made its members losers either way.
GM played by the capitalist system's rules. First, it always aimed to profit by driving its employees as hard as possible and paying them as little as it could. Second, GM secured the US market for its cars and trucks by blocking the development of high-quality mass transportation here. Auto workers fought, through the UAW, and eventually won decent wages and benefits that became goals for all other unions and workers for decades. US citizens' efforts to get quality mass transportation failed (hence Europe's far superior mass transport systems).
Under capitalism's rules, the decent wages and working conditions won by the UAW provoked GM to strike back by moving production where wages and benefits were lower. Thus GM's vehicle production inside the US peaked in the late 1970s (over 6 million) and has since fallen steadily (over 2 million in 2008). GM profited more from the much cheaper labor in China, Brazil, India, and elsewhere. The big losers have been the hundreds of thousands of laid-off, retired, and the few still employed auto workers, and everyone in Detroit and all the other consequently devastated communities. This week's GM bankruptcy creates still more losers to "rebuild GM's profitability."
Workers who struggle successfully for decent wages and working conditions always find that the system strikes back. That's how capitalism works, how capitalists profit. Republicans and Democrats alike proudly serve that system. And the lesson for GM and other workers is...?[Rick Wolff is a professor emeritus at the University of Massachusetts in Amherst and also a visiting professor at the graduate program in international affairs of the New School University in New York. He is the author of New Departures in Marxian Theory (Routledge, 2006) among many other publications. Check out Rick Wolff’s new documentary film on the current economic crisis, Capitalism Hits the Fan, at www.capitalismhitsthefan.com. This article first appeared at MRZine and is posted at Links International Journal of Socialist Renewal with permission.]
Goodbye GMBy Michael Moore
June 1, 2009 -- MichaelMoore.com -- I write this on the morning of the end of the once-mighty General Motors. By high noon, the president of the United States will have made it official: General Motors, as we know it, has been totalled.
As I sit here in GM's birthplace, Flint, Michigan, I am surrounded by friends and family who are filled with anxiety about what will happen to them and to the town. Forty per cent of the homes and businesses in the city have been abandoned. Imagine what it would be like if you lived in a city where almost every other house is empty. What would be your state of mind?
It is with sad irony that the company which invented "planned obsolescence" -- the decision to build cars that would fall apart after a few years so that the customer would then have to buy a new one -- has now made itself obsolete.
It refused to build automobiles that the public wanted, cars that got great gas mileage, were as safe as they could be, and were exceedingly comfortable to drive. Oh -- and that wouldn't start falling apart after two years. GM stubbornly fought environmental and safety regulations. Its executives arrogantly ignored the "inferior" Japanese and German cars, cars which would become the gold standard for automobile buyers.
And it was hell-bent on punishing its unionised workforce, lopping off thousands of workers for no good reason other than to "improve" the short-term bottom line of the corporation. Beginning in the 1980s, when GM was posting record profits, it moved countless jobs to Mexico and elsewhere, thus destroying the lives of tens of thousands of hard-working Americans. The glaring stupidity of this policy was that, when they eliminated the income of so many middle-class families, who did they think was going to be able to afford to buy their cars? History will record this blunder in the same way it now writes about the French building the Maginot Line or how the Romans cluelessly poisoned their own water system with lethal lead in its pipes.
So here we are at the deathbed of General Motors. The company's body not yet cold, and I find myself filled with -- dare I say it -- joy. It is not the joy of revenge against a corporation that ruined my hometown and brought misery, divorce, alcoholism, homelessness, physical and mental debilitation, and drug addiction to the people I grew up with. Nor do I, obviously, claim any joy in knowing that 21,000 more GM workers will be told that they, too, are without a job.
But you and I and the rest of America now own a car company! I know, I know -- who on earth wants to run a car company? Who among us wants $50 billion of our tax dollars thrown down the rat hole of still trying to save GM? Let's be clear about this: The only way to save GM is to kill GM. Saving our precious industrial infrastructure, though, is another matter and must be a top priority. If we allow the shutting down and tearing down of our auto plants, we will sorely wish we still had them when we realise that those factories could have built the alternative energy systems we now desperately need. And when we realise that the best way to transport ourselves is on light rail and bullet trains and cleaner buses, how will we do this if we've allowed our industrial capacity and its skilled workforce to disappear?
Thus, as GM is "reorganised" by the federal government and the bankruptcy court, here is the plan I am asking President Obama to implement for the good of the workers, the GM communities, and the nation as a whole. Twenty years ago when I made Roger & Me, I tried to warn people about what was ahead for General Motors. Had the power structure and the punditocracy listened, maybe much of this could have been avoided. Based on my track record, I request an honest and sincere consideration of the following suggestions:
1. Just as President Roosevelt did after the attack on Pearl Harbor, the president must tell the nation that we are at war and we must immediately convert our auto factories to factories that build mass transit vehicles and alternative energy devices. Within months in Flint in 1942, GM halted all car production and immediately used the assembly lines to build planes, tanks and machine guns. The conversion took no time at all. Everyone pitched in. The fascists were defeated.
We are now in a different kind of war -- a war that we have conducted against the ecosystem and has been conducted by our very own corporate leaders. This current war has two fronts. One is headquartered in Detroit. The products built in the factories of GM, Ford and Chrysler are some of the greatest weapons of mass destruction responsible for global warming and the melting of our polar icecaps. The things we call "cars" may have been fun to drive, but they are like a million daggers into the heart of Mother Nature. To continue to build them would only lead to the ruin of our species and much of the planet.
The other front in this war is being waged by the oil companies against you and me. They are committed to fleecing us whenever they can, and they have been reckless stewards of the finite amount of oil that is located under the surface of the earth. They know they are sucking it bone dry. And like the lumber tycoons of the early 20th century who didn't give a damn about future generations as they tore down every forest they could get their hands on, these oil barons are not telling the public what they know to be true -- that there are only a few more decades of useable oil on this planet. And as the end days of oil approach us, get ready for some very desperate people willing to kill and be killed just to get their hands on a gallon can of gasoline.
President Obama, now that he has taken control of GM, needs to convert the factories to new and needed uses immediately.
2. Don't put another $30 billion into the coffers of GM to build cars. Instead, use that money to keep the current workforce -- and most of those who have been laid off -- employed so that they can build the new modes of 21st century transportation. Let them start the conversion work now.
3. Announce that we will have bullet trains criss-crossing this country in the next five years. Japan is celebrating the 45th anniversary of its first bullet train this year. Now they have dozens of them. Average speed: 165 mph. Average time a train is late: under 30 seconds. They have had these high speed trains for nearly five decades -- and we don't even have one! The fact that the technology already exists for us to go from New York to LA in 17 hours by train, and that we haven't used it, is criminal. Let's hire the unemployed to build the new high speed lines all over the country. Chicago to Detroit in less than two hours. Miami to DC in under seven hours. Denver to Dallas in five and a half. This can be done and done now.
4. Initiate a program to put light rail mass transit lines in all our large and medium-sized cities. Build those trains in the GM factories. And hire local people everywhere to install and run this system.
5. For people in rural areas not served by the train lines, have the GM plants produce energy efficient clean buses.
6. For the time being, have some factories build hybrid or all-electric cars (and batteries). It will take a few years for people to get used to the new ways to transport ourselves, so if we're going to have automobiles, let's have kinder, gentler ones. We can be building these next month (do not believe anyone who tells you it will take years to retool the factories -- that simply isn't true).
7. Transform some of the empty GM factories to facilities that build windmills, solar panels and other means of alternate forms of energy. We need tens of millions of solar panels right now. And there is an eager and skilled workforce who can build them.
8. Provide tax incentives for those who travel by hybrid car or bus or train. Also, credits for those who convert their home to alternative energy.
9. To help pay for this, impose a two-dollar tax on every gallon of gasoline. This will get people to switch to more energy saving cars or to use the new rail lines and rail cars the former autoworkers have built for them.
Well, that's a start. Please, please, please don't save GM so that a smaller version of it will simply do nothing more than build Chevys or Cadillacs. This is not a long-term solution. Don't throw bad money into a company whose tailpipe is malfunctioning, causing a strange odor to fill the car.
One-hundred years ago this year, the founders of General Motors convinced the world to give up their horses and saddles and buggy whips to try a new form of transportation. Now it is time for us to say goodbye to the internal combustion engine. It seemed to serve us well for so long. We enjoyed the car hops at the A&W. We made out in the front -- and the back -- seat. We watched movies on large outdoor screens, went to the races at NASCAR tracks across the country, and saw the Pacific Ocean for the first time through the window down Highway 1. And now it's over. It's a new day and a new century. The president -- and the UAW -- must seize this moment and create a big batch of lemonade from this very sour and sad lemon.
Yesterday, the last surviving person from the Titanic disaster passed away. She escaped certain death that night and went on to live another 97 years.
So can we survive our own Titanic in all the Flint Michigans of this country. 60% of GM is ours. I think we can do a better job.