Interesting article in the WSJ about how Detroit drove the American automotive industry into the ground. The American car companies are losing money hand-over-fist while the Japanese, Korean, and German companies are building new factories. Expect GM and co. to be the next big corporations demanding bailouts in order to "save" the economy, probably sometime next year. Once you open up the bailout trough every pig wants a share.
On a semi-related note, had an interesting conversation over lunch yesterday about the direction of the car industry. There’s a good chance that Tesla Motors, with their all-electric vehicles, is creating the future of cars. It’s worth noting that Tesla is a private company, working with technology (battery power) that experts had largely dismissed as a dead end. Instead, we got public investment in hybrids (an interim solution), the "hydrogen economy" (remember that?), and Ethanol, which even environmental groups are now acknowledging was an unmitigated disaster – environmentally, economically, and diplomatically. This is one of the reasons I don’t trust the government to move us towards a more sustainable future – when the government works on something they pick one or two golden solutions (usually with the "help" of well-funded lobbies), throw all the money at those, and ignore any and all other innovations until long after their chosen path has been shown to be a debacle. Experience is more and more showing that "X-prize"-style competitions between independent organizations yield more diverse and promising innovations. Yet most "X-prizes" are still privately funded.
It’ll be interesting to see if the Detroit/Autoworkers Union lobbies try to put up roadblocks to the success of electric transport in the US. Electric transportation will also drastically change the auto maintenance market – another potential source of push-back. Will an Obama campaign allow more-sustainable alternatives to move forward, or will it "protect" American business by propping up dying industries and regulating nascent ones? Time will tell.
Yup. They were talking about that on NPR this morning. eneral Motor executives are in Washington, D.C., asking for some of the $700 billion financial bailout money.
Because, yanno, actually building cars people WANT, that are (*gasp*) eco-friendly, that would be silly! We’ll just let the gummint bail us out!
A few quibbles..
This is why I don’t trust certain governments (Bush’s “hydrogen economy” was never serious–it was merely an attempt to forestall any imminent change until 20 years in the future…)… to do industrial change.
It’s not as if GM is a governmental organization.. just like Tesla, they are private industry.. and they screw stuff up without any governmental help… If Tesla were huge, they might also seek out government funding to avoid bankruptcy.. (if you were leading such a firm, wouldn’t you? )
I agree, however, that it will be a test to see if Obama doesn’t stand up to them and says “No, we need automobiles in this country–but that doesn’t mean we need your kind of automobiles. You had your chance to evolve over the past years… grow up.”..
In any case, what is an added story here–is that American auto companies overseas actually have truly efficient automobiles–Ford has 5 or six large cars (even almost an SUV) that gets 40+ (55+ for smaller cars) mpg using diesel… but they won’t sell them here because they say that Americans won’t buy them. Bullshit.
So.. it’s not that these private firms don’t actually have some of the necessary tech–they just refuse to grow and that’s why they shouldn’t be bailed out… they need to be shaken up and bitch slapped until they wake up.
As for autoworker unions–I personally wonder if they’d be so opposed to electric transport–it’s not as if an autoworker who installs body parts on current cars, couldn’t also learn to install the body parts on electric cars… Just because the engine is different, doesn’t mean that assembly is something entirely different..
In any case–x-prizes type of stuff are effective–but usually only in the context of the application of already known fundamental knowledge. Getting a corporation to create space flight for the masses–when all of the basic laws of a lot of technical data of space flight–were worked out 40 years ago by the government–is a great idea and has been relatively successful (it’s very similar to the reasoning for why capitalist economies are awesome at making consumer products, whereas socialist countries aren’t…). Offering an x-prize to create an anti-gravity machine, however, or something similar–where basic laws aren’t known–hasn’t been nearly so successful–and probably won’t.. because there is no financial incentive to do so when everyone else can reverse engineer the machine you spent 200 billion dollars on to discover, but then get nothing back on…
If you want a great book on this kind of thing.. read Merritt Roe Smith’s book “Harper’s Ferry” about the development of interchangeable parts in government Armories… It’s pretty good History of Technology…
Re: A few quibbles..
My guess is “yes”, judging by the resistance they’ve had to minor assembly line changes (there are some examples in the article).
My favorite union story: where I used to work, we got an FAA contract to upgrade a system to the level of functionality we’d sold to the Chinese. Part of the contract was to *downgrade* the displays to exactly mimic the old, lower-quality displays because the Air Traffic Controller’s Union refused to accept the controllers having to learn how to use the new displays (not that there was much to learn). We used to talk about “accidentally” switching to “advanced mode” at demos because we were pretty sure the controllers themselves would love the improved display and talk to their bosses about it.
I support the existence of Unions – the alternative is worse – but there is something fundamentally fucked-up about unions in the US.
good points…
.. Unions have to evolve also.. or they’re fucked..
Re: A few quibbles..
Incidentally, I think you could well be right about private business being better at taking research the last mile and turning it into a product than at pure research. For a lot of the pure research that has gone into things like space travel, though, the working formula hasn’t really been “government + academia” – it’s been more along these lines:
Our space program got its start on the backs of German wartime science and made its way to the moon on fears that the Soviets would beat us there. Government pushes research, yes; but it gets its best results when there’s a war on. I find this troubling.
It may be worth noting that Tesla Motors, after surveying the field, decided to go with laptop batteries for their power storage, because laptop batteries are improving in efficiency faster than any other type. I don’t know the scientific history of battery technology very well, but it seems reasonable to assume that someone, somewhere is doing theoretical work on cramming more power into smaller and smaller spaces, and they are doing it at the behest of Toshiba and Sony rather than the Dept. of Energy. I could be wrong.