Obama Does Detroit

Brad Plumer: "The knock against Obama is that he often shies away from confrontation, but yesterday he did waltz into a room full of Detroit businessmen and lecture them about the need for stricter fuel-economy standards. (The speech itself was pretty harsh, and he didn't exactly draw applause with lines like this: "Even as [automakers] shed thousands of jobs... over the last few years, they've continued to reward failure with lucrative bonuses for CEOs.")

Good for him. The US auto companies are sort of sitting ducks for criticism at this point, but the car industry is probably the toughest one for a Democrat to take on thanks to the UAW and the general swinginess of Michigan.

Comments

Obama did shy away from confrontation with a traditional Democratic constituency that's at least equally culpable in Detroit's woes: the UAW. Unionized auto workers have bled the industry for decades, demanding outrageous benefits (e.g., getting paid not to work for years in the "jobs bank") and taking no initiative to keep down health care costs, with their smoking, drinking and over-eating. Toyota and Honda have profitably built cars in the U.S. for years with non-unionized (though well-paid) workers.

Posted by Fred | May 8, 2007 1:46 PM

Petey's Internal Debate

Petey: Ignore the post. Just ignore it.

Petey: You can't ignore it. I bet Obama wouldn't be saying things like this if he was in the Senate five years ago.

Petey: What?

Petey: It's obvious.

Posted by Petey's Conscience | May 8, 2007 1:56 PM

"Petey: Ignore the post. Just ignore it."

Actually, my first reaction was to comment and say that taking on the auto industry is precisely the kind of psuedo 'courageous stance' one would expect a goo-goo wine-track candidate to take.

My second reaction was to resist the urge since it seemed to me like a substance-free cheap shot that unfairly belittled what seems to be an admirable position from Obama.

But I think a non-cheap shot is to say that if stuff like this were a standard part of Obama's repertoire, rather than the odd exception, he'd be a lot more suited to being the Democratic standard bearer in 2008.

Posted by Petey | May 8, 2007 2:08 PM

Good stuff from Obama. If he speaks clearly about say ethanol subsidies in Illinois and does some "confronting" of the other side as well, that will seriously erode my misgivings about him.

Posted by rilkefan | May 8, 2007 2:14 PM

Petey has a fanclub now, huh.

Clearly this is just the beginning of Obama's policy rollout. The "empty suit" charge against his candidacy was always the lamest of them all.

Posted by Korha | May 8, 2007 2:27 PM

Toyota and Honda have profitably built cars in the U.S. for years with non-unionized (though well-paid) workers.

The Risk Pool

How long has GM and Ford been paying retirement and health costs? How long have Honda and Toyota been paying health costs in the US? How many old(needing a lot of healthcare)/retired workers do you think Toyota and Honda have in the US compared to GM and Ford? How does Japan's healthcare system affect their legacy costs for workers at home(affecting worldwide pricing)?

taking no initiative to keep down health care costs, with their smoking, drinking and over-eating

Nanny state!!

Posted by Rambuncle | May 8, 2007 3:13 PM

It doesn't matter, because as the alternating gnashing of teeth and smugness might indicate, HRC has already sewn up the nomination, right? Inevitable? Right?

Posted by JMS | May 8, 2007 3:51 PM

Obama did shy away from confrontation with a traditional Democratic constituency that's at least equally culpable in Detroit's woes: the UAW.

The UAW would have to be pretty dumb not to recognize call for heavier regulation of the auto industry as contrary to their longtime stance on this question.

Posted by Matthew Yglesias | May 8, 2007 3:52 PM

Even the anti-union GOP isn't stupid enough to go around lecturing union members on how they eat too much fried food.

Posted by Steve | May 8, 2007 4:00 PM

Auto Extremist

To get a bit of the mentality in the Detroit auto industry, I'd encourage anyone to read the above blog. It's written by a former ad exec in the auto industry. His father was a bigwig at GM back in the 50's/60's.

One of his points, in his latest post speaks to Obama's fuel economy speech : "Peruse any major newspaper in the West, Northwest and Northeast, or just tune-in to some of the ill-informed and misguided comments emanating from the representatives in Washington from those areas, and the vitriol directed against what's left of the Big Three is shocking in its relentless negativity. There is no middle ground or an occasional voice of reason to be found either. "Detroit" has been relegated to the same territory that the railroads occupy. It used to be that it could be distilled down to the simple Detroit=Bad, Toyota=Good formula, because Toyota won the PR/Image/Lobbying war a long time ago. But now it's just Detroit=Bad, as if an entire region of the country has become the national Whipping Boy for whatever environmental problems exist in the U.S., or anything else for that matter. The attack on the automobile in this country has become open season on Detroit itself, with the Asian and German manufacturers somehow getting a free pass in the discussion as if they don't build the so-called "bad" cars (as the Greenies classify them) like Detroit does. For instance, Toyota never gets called out for making giant SUVs that barely get 13 mpg in the city - it's as if it never happened. But Detroit's image is so far buried in this teeming Sea of Negativity that they can't even get a word in edgewise."

Posted by anon | May 8, 2007 5:24 PM

Matt:

"The UAW would have to be pretty dumb not to recognize call for heavier regulation of the auto industry as contrary to their longtime stance on this question."

Perhaps, but in the excerpt of Obama's speech that I heard, he talked about auto workers suffering due to the mistakes of management -- as if those autoworkers' demands played no role in the decline of the big three.

Posted by Fred | May 8, 2007 5:31 PM

Well anon Toyota never hired battalians of lobbyists and lawyers to fight against raising CAFE standards in DC over the last 25 years either. They hired engineers instead and let Detroit do that heavy lifting for them. Now when the day inevitably has come when higher mileage and lower emission cars are necessary the Big Three are stuck. Anybody older than 40 knew these days were coming since the oil shocks of 1973 and 1979. Detroit decided to stick their heads in the sand.

Posted by markg8 | May 8, 2007 5:39 PM

From what I've heard about Obama in the past, this sort of confrontation actually is the kind of thing he does pretty frequently. He's able to tell his immediate audiences what they don't want to hear. And good for him.

But seeing him push for a sensible-centrist (and genuinely sensible) position like stricter fuel economy standards doesn't really affect the basic progressive worry about Obama very much. Is he willing to carry the progressive banner on an issue (say, health care) where there's a risk that elite centrist opinion will abandon him? The last sign of this we got was 2002, and he was so far under the radar then that it's hard to know how relevant that is.

Posted by Neil the Ethical Werewolf | May 8, 2007 5:42 PM

markg8,

All the auto companies, including Toyota, lobby in Washington.

Toyota makes a 13 mpg SUV.

If poor mileage and hiring lobbyists are your criteria for criticizing Detroit based automakers, you must hate Toyota as well.

Posted by anon | May 8, 2007 5:54 PM

Basing your profitability on selling huge quantities of SUVs and pickup trucks, while investing virtually zero money into the development of fuel efficient technologies are much better criteria for criticizing the Big Three.

Posted by daveNYC | May 8, 2007 6:17 PM

It's amusing how conservatives have such faith in the free market and the incontestable correctness of market forces - except when it comes to unions, who are routinely excoriated by the Right for doing nothing more than behaving like any other market actor.

The salient difference between labor and management is that management actually gets to run the company. If management decides to allocate some resources towards a long-term strategy of developing more fuel-efficient vehicles, they can do it. If labor thinks that would be a good idea, on the other hand, they have absolutely no power to implement it.

The unions have the option of making less burdensome demands on management (again, conservatives would never dream of expecting this from any other sort of market actor), but they have no assurance that the company's newfound wealth will go towards anything other than the CEO's benefits package.

In a perfect world, maybe the company and the union would sit down at the bargaining table and each agree to give up a little piece of the pie for the sake of implementing a particular longterm strategy. However, before criticizing the union as being equally to blame, it would be nice to have some evidence that such a bargain was actually on the table at some point.

Posted by Steve | May 8, 2007 6:27 PM

Does this count as a Sister Souljah moment? I mean, sure, Detroit isn't "extreme," except maybe in their truck ads, and there's no racial component, except, well, for Obama himself, so I'm not sure if this is part of the normative semiotics, as it were.

Posted by James Killus | May 8, 2007 6:29 PM

Criticism of Obama's stance relative to Edwards and Clinton at DK.

Posted by rilkefan | May 8, 2007 6:47 PM

Bashing auto industry management isn't exactly courageous even in Michigan. Most auto workers consider the head honchos a pack of idiots too.

Posted by Jonf | May 8, 2007 7:10 PM

"Criticism of Obama's stance relative to Edwards and Clinton at DK."

Huh. Now I'm glad now that I couched my words upthread:

what seems to be an admirable position from Obama.

Dude ought to print up bumperstickers:

Barack Obama for President
Paid for by The 50 Yard Line Party

Posted by Petey | May 8, 2007 7:30 PM

Um... anyone who's been seriously paying attention to Obama knows that criticizing the audience inside the room for the sake of the audience outside the room has been Obama's MO for a while.

But dumbass pundit common wisdom being dumbass pundit common wisdom...

Posted by dk | May 8, 2007 8:24 PM

In many ways, Obama is like a terrorist, albeit a soft terrorist. He hates the West and wants to see its fall.

It is only natural that Obama would hate many of the industrial towns: afterall, they are populated by poor white people, the people Obama despises most. If Obama had his way, he'd just globalize the entire industry and line up all these whites and shoot them.

People need to wake up. Obama hates Western Civilization and wants to see its destruction. He is a very dangerous man.

Posted by Michael Oakeshott | May 8, 2007 9:57 PM

Wow, you know a parody comment was weird when it's the last in a thread and doesn't get called out for over three hours.

Posted by Reality Man | May 9, 2007 1:16 AM

Ford, GM, and Chrysler are overlooking a much more affordable solution to healthcare and pensions for retirees.

I'm sure they could make it look like an accident, too.

Posted by Jon H | May 9, 2007 2:08 AM

"Toyota makes a 13 mpg SUV."

So? The main thing is that they don't pin their entire business on that SUV.

The US car firms, on the other hand, keep thinking the way out of their hole is to come up with a new SUV.

As I've said elsewhere, the difference between US carmaker management and Japanese carmaker management is that the US firms are run by hot rod buffs who get off on powerful engines and chrome, whereas the Japanese carmakers are managed by technocrats who, like at Honda, can get excited about making little dancing robots.

At the end of the day, the Japanese guys have robot technology that might be applied to the car business, while the US carmakers have a warmed over 30 year old Hemi which gets them nowhere.

It's no wonder Honda and Toyota are getting ahead.

Posted by Jon H | May 9, 2007 2:18 AM

If the downfall of the big three is due solely to stupid management, why don't the auto workers start their own car company? It's not as if they don't have the money to start a small one, focussed on one or two smart products: tens of thousands of UAW members are accepting six-figure buyouts. Why not put some of those $ billions where their mouths are and do better?

Posted by Dave | May 9, 2007 12:51 PM

"The US car firms, on the other hand, keep thinking the way out of their hole is to come up with a new SUV."

This confuses cause and effect. Trucks and SUVs are the only products U.S. firms sell that have profit margins high enough to support UAW-imposed costs such as the "jobs bank" that pays thousands of hourly employees not to work.

Posted by Fred | May 9, 2007 1:35 PM

GM, Ford and Chrysler all have full product lines. Profits are low in mid-sized sedans, because every company in the world is selling mid-sized sedans in the USA.

Posted by anon | May 9, 2007 3:28 PM