6
The End of the American Automobile Industry
To understand what doomed the American automobile we should give up on economics and turn to melodrama. Politicians, journalists, financial analysts, and other purveyors of banality have been looking at cars as if a convertible were a business. Fire the MBAs and hire a poet. The fate of Detroit isn’t a matter of financial crisis, foreign competition, corporate greed, union intransigence, energy costs, or carbon emissions. It’s a tragic romance—unleashed passions, titanic clashes, lost love, and wild horses.
Foremost are the horses. Cars can’t be comprehended without horse sense. A hundred and some years ago Rudyard Kipling wrote a poem, “The Ballad of the King’s Jest,” in which an Afghan tribesman avers:
Four things greater than all things are,—
Women and Horses and Power and War.
Insert another “power” after the horse and the verse was as true in the suburbs of my boyhood as it was in the Khyber Pass.
Horsepower is not a quaint leftover of linguistics or a vague metaphoric anachronism. James Watt, father of the steam engine and progenitor of the industrial revolution, lacked a measurement for the movement of weight over distance in time, what we’d call energy. (What we’d call energy wasn’t even an intellectual concept in the late eighteenth century, in case you think the 2008 financial crisis was history’s most transformative moment.) Watt did research using draft animals and found that, under optimal conditions, a dray horse could lift 33,000 pounds one foot off the ground in one minute. Watt—the eponymous watt not yet existing—called this unit of energy “one horsepower.” It is, by the way, equal to 746 watts. Thus your supposedly thrifty Honda Insight could illuminate a fair stretch of Broadway, causing enough harmful light pollution to offset the detrimental air pollution that you prevented by not buying a Cadillac Escalade.
In 1970 a Pontiac GTO (may the brand name rest in peace) had horsepower to the number of 370. In the time of one minute, for the space of one foot, it could move 12,210,000 pounds. And it could move those pounds down every foot of every mile of all the roads to the ends of the earth for every minute of every hour until the driver nodded off at the wheel. Forty years ago the pimply kid down the block, using $3,500 in saved-up soda-jerking money, procured might and main beyond the wildest dreams of Genghis Khan whose hordes went forth to pillage mounted upon less oomph than is in a modern leaf blower.
Probably Genghis Khan and the pimply kid were just looking for dates. Horses and horsepower alike are about status and being cool. A knight in ancient Rome was bluntly called “guy on horseback,” equesitis. Chevalier means the same, as does Cavalier. Lose the capitalization on Cavalier and the dictionary says, “insouciant and debonair; marked by a lofty disregard of others’ interests, rights, or feelings; high-handed, arrogant and supercilious.” How cool is that? Then there are cowboys—always cool—and the U.S. cavalry that coolly comes to their rescue plus the proverbially cool-handed “Man on Horseback” to whom we turn in troubled times. (One reason that it’s impossible to keep a straight face at anything Washington says is a mental picture of Barney Frank astride a prancing steed in the Lone Ranger manner, “Hi, ho, Executive Compensation! And away!”)
Early witnesses to the automobile urged motorists to get a horse. But that, in effect, was what the automobile would do—get a horse for everybody. Once the Model T was introduced we all became Sir Lancelot, gained a seat at the Round Table, and were privileged to joust for the favors of fair maidens (at drive-in movies). The pride and prestige of a noble mount was vouchsafed to the common man. And woman too. No one ever tried to persuade ladies to drive sidesaddle with both legs hanging out the car door.
A car isn’t necessarily cheaper than a horse, just cheaper than a horse you’d want. At about the time Henry Ford was peddling his Model T for $780, a yearling filly named Sceptre (admittedly with excellent racing bloodlines) sold at Newmarket for 10,000 guineas. In current U.S. dollars 10,000 guineas is... Let’s just say that if ousted General Motors CEO Rick Wagoner—instead of a stallion called Ornament—had been the stud who sired Sceptre, it would have been GM telling the White House to get new management.
Cars, especially the cars of yore, were not reliable. But neither are horses, and at least with cars it isn’t personal. Horses have complex psychologies and itty-bitty brains. Horses are like your adolescent children. Cars are like your computer. The computer may be balky, slow, even worthless, but it never dresses itself all in black, gets every part of its keyboard pierced, screams that you just don’t understand, and goes out and takes drugs and is brought home by the police at three in the morning. Actually, horses don’t either. But you know what I mean.
Changing a tire on a car is no fun but it’s easier than shoeing a horse. And you won’t get kicked or bitten or have manure dumped on your head while you’re changing a tire, unless you change it in a very bad neighborhood.
Cars may be put in dark, cramped, ill-ventilated places and left there for months and the ASPCA will not protest. For that matter cars may be thrashed in the street without raising public ire. (Although it’s best if you own the car.)
Even when OPEC is doing its worst, cars are more efficient to fuel than horses. (Although a roll in the hay is preferable to a roll in the petroleum.)
And anyone who thinks that cars add to greenhouse gases and horses do not hasn’t spent enough time behind a horse.
For the purpose of ennobling us schlubs, the car is better than the horse in every way. Even more advantageous than cost, convenience, and not getting kicked and smelly is how much easier it is to drive than to ride. I speak with feeling on this subject, having taken up riding when I was nearly sixty and having begun to drive when I was so small that my cousin Tommy had to lie on the transmission hump and operate the accelerator and the brake with his hands so that I could steer.
After the grown-ups had gone to bed Tommy and I shifted the Buick into neutral, pushed it down the driveway and out of earshot, started the engine, and toured the neighborhood. The sheer difficulty of horsemanship can be illustrated by what happened to Tommy and me next. Nothing. We maneuvered the car home, turned it off, and rolled it back up the driveway. (We were raised in the blessedly flat Midwest.) During our foray the Buick’s speedometer reached 30. But 30 mph is a full gallop on a horse. Forget what you’ve seen of horse riding in movies. Possibly a kid who’d never been on a horse could ride at a gallop without killing himself. Possibly one of the Jonas Brothers could land an F-18 on a carrier deck.
Thus cars usurped the place of horses in our hearts. Once we’d caught a glimpse of a well-turned Goodyear, checked out the curves on the bodywork, and gaped at that swell pair of headlights, well, the old gray mare was not what she used to be. We embarked upon life in the fast lane with our new paramour. It was a great love story of man and machine. The road to the future was paved with bliss. Then we got married and moved to the suburbs.
Being away from central cities meant Americans had to spend more of their time driving. Over the years, away got farther away. Eventually this meant that Americans had to spend all of their time driving. The playdate was forty miles from the Chuck E. Cheese. The swim meet was forty miles from the cello lesson. The Montessori school was forty miles from the math coach. Mom’s job was forty miles from Dad’s job and the three-car garage was forty miles from both.
The car ceased to be object of desire and equipment for adventure and turned into office, rec room, communications hub, breakfast nook, and recycling bin—a motorized cupholder. Americans, the richest people on earth, were stuck in the confines of their Lexus crossover, squeezed into less space than tech-support call center employees in a Mumbai cubicle farm. Never mind the six-bedroom, eight-bath, pseudo-Tudor with cathedral-ceilinged great room and thousand-bottle controlled climate wine cellar. It was a day’s walk away.
We became sick and tired of our cars and even angry at them. Pointy-headed busybodies of the environmentalist, new urbanist, utopian ty
pe blamed the victim. They claimed the car had forced us to live in widely scattered settlements in the great wasteland of big box stores and the Olive Garden. If we would all just get on our twenty-speed derailleurs or hop a trolley, they said, America could become an archipelago of cozy gulags on the Portland, Oregon, model with everyone nestled together in the most sustainably carbon-neutral, diverse, and ecologically unimpactful way.
But cars didn’t shape our existence; cars let us escape with our lives. We’re way the heck out here in Valley Bottom Heights and Trout Antler Estates because we were at war with the cities. We fought rotten public schools, idiot municipal bureaucracies, corrupt political machines, rampant criminality, and all the pointy-headed busybodies. Cars gave us our dragoons and hussars, lent us speed and mobility, let us scout the terrain and probe the enemy’s lines. And thanks to our cars, when we lost the cities we weren’t forced to surrender, we were able to retreat.
But our poor cars paid the price. They were flashing swords beaten into dull plowshares. Cars became appliances. Or worse. Nobody’s ticked off at the dryer or the dishwasher, much less the fridge. We recognize these as labor-saving devices. The car, on the other hand, seems to create labor. We hold the car responsible for all the dreary errands to which it needs to be steered. Hell, a golf cart’s more fun. You can ride around in a golf cart with a six-pack, safe from Breathalyzers, chasing Canada geese on the fairways, and taking swings at gophers with a sand wedge.
We’ve lost our love for cars and forgotten our debt to them and meanwhile the pointy-headed busybodies have been exacting their revenge. We escaped the poke of their noses once, when we lived downtown, but we won’t be able to peel out so fast the next time. In the name of safety, emissions control, and fuel economy, the simple mechanical elegance of the automobile has been rendered ponderous, cumbersome, and incomprehensible. One might as well pry the back off an iPod as pop the hood on a contemporary motor vehicle. An aging shade tree mechanic like myself stares aghast and sits back down in the shade. Or would if the car weren’t squawking at me like a rehearsal for divorce. You left the key in. You left the door open. You left the lights on. You left your dirty socks in the middle of the bedroom floor.
I don’t believe the pointyheads give a damn about climate change or gas mileage, much less about whether I survive a head-on with one of their tax-sucking mass transit projects. All they want is to make me hate my car. How proud and handsome would Bucephalus look or Traveller or Man O’War with seat and shoulder belts, air bags, 5 mph bumpers, and a maze of pollution control equipment under its tail?
And there’s the end of the American automobile industry. When it comes to dull, practical, ugly things that bore and annoy me, Korean things cost less and have more cupholders.
The American automobile is—that is, was—never a product of Asian-style institutional industrialism. America’s steel, coal, beer, beaver pelts, and PCs may have come from our business plutocracy, but American cars have been manufactured mostly by romantic fools. David Buick, Ransom E. Olds, Louis Chevrolet, Robert and Louis Hupp of the Hupmobile, the Dodge brothers, the Studebaker brothers, the Packard brothers, the Duesenberg brothers, Charles W. Nash, E. L. Cord, John North Willys, Preston Tucker, and William H. Murphy, whose Cadillac cars were designed by the young Henry Ford, all went broke making cars. The man who founded General Motors in 1908, William Crapo (really) Durant, went broke twice. Henry Ford, of course, did not go broke, nor was he a romantic, but judging by his opinions he certainly was a fool.
America’s romantic foolishness with cars is finished, however, or nearly so. In the far boondocks a few good old boys haven’t got the memo and still tear up the back roads. Doubtless the Department of Transportation is even now calculating a way to tap federal stimulus funds for mandatory OnStar installations to locate and subdue these reprobates. Among certain youthful Americans of Hispanic and Asian extraction there remains a fondness for Chevelle lowriders and hopped-up Honda “tuners.” The pointy-headed busybodies have yet to enfold these youngsters in the iron-clad conformity of cultural diversity’s embrace. Soon Wong and Juan will be expressing their creative energy in a more constructive way, planting bok choy in community gardens and decorating homeless shelters with murals of Che.
I myself have something old school under a tarp in the basement garage. I bet when my will has been probated, a child of mine will yank the dust cover and use the proceeds of the eBay sale to buy a mountain bike. Four things greater than all things are, and I’m pretty sure one of them isn’t bicycles. There are those of us who have had the good fortune to meet with strength and beauty, with majestic force in which we were willing to trust our lives. Then a day comes, that strength and beauty fails, and a man does what a man has to do. I’m going downstairs to put a bullet in a V-8.
7
The Trade Imbalance
There is no such thing as a trade imbalance. Trade can’t be out of balance because a balance is what trade is. Buyers and sellers decide that one thing is worth another. All free trade is balanced trade. Saying there’s an imbalance in freely conducted trade is like saying there’s an imbalance in freely conducted sex. It’s like admitting you screwed some half-baked videographer who was hanging around your presidential campaign, and then claiming she had sex and you didn’t. But you’re not John Edwards.
There is no such thing as a trade deficit. It doesn’t matter if America imports all its goods from China and exports nothing but pieces of paper. The Americans want the iPad and the Chinese want the handsome portraits of Benjamin Franklin. This is free trade. No coercion is involved. The only coercion existing in U.S./China trade comes in the form of import and export restrictions imposed by both countries to keep the trade from happening.
Nobody is making Americans buy Chinese goods. It’s not like the Opium Wars of 1839–42 and 1856–60 when the British forced the Chinese to accept shipments of, shall we say, pharmaceutical exports. Maybe the Chinese will fight a war with America—the Consumer Electronics War of 2011, with Chinese gunboats cruising the fountains in America’s malls. But it hasn’t happened yet.
I look around my house and everything except the kids and dogs is made in China. And I’m not sure about the kids. They have brown eyes and small noses. All the Chinese got in return were those pieces of paper and an occasional 747 and some Yahoo software. Even if the software is illegally copied 1.3 billion times—and it has been; I’ve seen it for sale in Shanghai—China would appear to be getting the short end of the stick. Because here’s another economic principle that’s as inexorable as free trade: imports are good, exports are bad. Imports are an income, exports are an expense. Imports are Christmas morning, exports are January’s Visa bill.
There’s no such thing as a trade deficit, but there is such a thing as a current accounts deficit. The Chinese have decided to import money instead of things they can immediately enjoy—my black Lab would make quite a stir fry. China holds an enormous amount of U.S. money and we don’t hold any of theirs. This worries America. I’ll be damned if I know why.
The U.S. dollar is a promissory note from the Federal Reserve Bank, and it’s not a promissory note that promises much. It’s not backed by gold or silver or shares in Apple. If Hu Jintao brought a $100 bill to Washington and took the $100 bill to the Treasury Department—which he easily could do, if he could get a moment off from being annoyed and patronized by our president, because the Treasury building is right next door to the White House—all Hu could get for that $100 bill is a hundred dollars. He could get it in twenties. He could get it in tens. He could get it in shiny new dimes. But Treasury won’t give anything to anybody for their American money except more American money.
China has the same kind of big, honking IOU that you’ve got in your Social Security account. (Hope all the Chinese don’t decide to retire at the same time as us baby boomers!) When China holds an enormous amount of U.S. money, China is giving an interest-free loan to our Federal Reserve Bank.
Maybe American policy w
onks are worried that China will suddenly spend all that cash and that this will somehow damage certain sectors of the American economy worse than America itself has managed to damage them. I’ve spent time in China and have eaten my share of its regional delicacies, and I will admit that if the Chinese spend all their U.S. dollars our pet shops will be stripped bare.
Or maybe America’s policy wonks are worried that the current account deficit with China will cause the U.S. dollar to be devalued. In that case they can quit worrying about Chinese exports because every Hot Wheels car will be as expensive as if it had been hand-crafted by Louis Vuitton. This—in households such as mine where the annual demand for Hot Wheels cars is larger than a Toyota recall—will cause rampant inflation. Then the policy wonks can worry about that.
One more thing the wonks worry about is that the renminbi is too cheap, that in order to make Chinese exports more attractive the Chinese government is artificially keeping the value of China’s currency too low. It is. And, when it comes to buying exports, the other fellow’s currency can’t be too low. It’s like the importer has gone to a Hollywood real estate agent who says, “There’s a house in Beverly Hills. The price is five million dollars. But my client will take five million Mexican pesos instead.”
Has Chinese economic development cost American workers their jobs? Sure. That’s the price of progress. The invention of fire cost Cro-Magnon workers their jobs—all those people you paid to sit on you to keep you warm. But no American politician, whether elected, appointed, or squatting on the New York Times editorial board, is going to go on Hardball and tell us that when we lose our job, due to some guy in Guangzhou being willing to do it for $145 a month, it’s because what we did wasn’t worth a shit.
When you’re doing something that isn’t worth a shit (and I speak as a print journalist), you’ve got two choices. Either you can do something that is worth a shit or you can try to make everyone else do something that’s as shit worthless as what you do. You can be Chinese or you can be French. You can build cars or you can burn them in the suburbs of Paris. We don’t want the Chinese doing things that aren’t worth a shit such as crossing the Yalu in hordes the way they did during the Korean War or wading the Formosa Strait to belatedly settle Chiang Kai-shek’s hash in Taiwan. Let’s keep them busy making money.
Don’t Vote Page 13
