After America - Mark Steyn [107]
In 2009, General Motors had a market valuation about a third of Bed, Bath & Beyond, and no one says your Swash 700 Elongated Biscuit Toilet Seat Bidet is too big to fail.12 For purposes of comparison, GM’s market capitalization was then about $2.4 billion versus Toyota’s $100 billion and change (the change being bigger than the whole of GM).13 General Motors, like the other two geezers of the Old Three, is a sprawling retirement home with a small money-losing auto subsidiary. The United Auto Workers is the AARP in an Edsel: it has three times as many retirees and widows as “workers” (I use the term loosely).14 GM has 96,000 employees but provides health benefits to a million people. How do you make that math add up? Not by selling cars: Honda and Nissan were making a pretax operating profit per vehicle of around $1,600; Ford, Chrysler, and GM a loss of $500 to $1,500.15 That’s to say, they lose money on every vehicle they sell. Like Henry Ford said, you can get it in any color as long as it’s red.
President Obama, in that rhetorical tic that quickly became a bore, likes to position himself as a man who won’t duck the tough decisions. So, faced with a U.S. automobile industry that so overcompensates its workers it can’t make a car for a price anybody’s willing to pay for it, the president handed over control to the very unions whose demands are principally responsible for that irreconcilable arithmetic. Presented with a similar situation thirty years earlier, Mrs. Thatcher took on the unions and, eventually, destroyed their power. That was a tough decision. Telling your political allies they can now go on overpaying themselves in perpetuity is a piece of cake.
When the going gets tough, the tough get bailed out. Your car business operates on a failed business model? Don’t worry, the taxpayers will prop that failed business model up forever. You went bananas on your credit card and can’t pay it back? Order another round and we’ll pass a law to make it the bank’s fault. Your once Golden State has decayed into such a corrupt racket of government cronyism that the remaining revenue generators are fleeing your borders faster than you can raise taxes on them? Relax, we’re lining up a federal bailout for you, too. Your unreadable newspaper woke up from its 96-page Obama Full Color Inaugural Souvenir bender to discover that its advertising revenue had collapsed with the real-estate market and GM dealerships? Hey, lighten up, John Kerry’s already been pleading your case in the Senate.16 Is it really so hard to picture the President calling the Mayor to assure him he has no plans to move the New York Times out of New York?
America is now a land that rewards failure—at the personal, corporate, and state level. If you reward it, you get more of it. If you reward it as lavishly as the federal government does, you’ll get the Radio City Christmas Spectacular of Failure, on ice and with full supporting orchestra. The problem is that, in abolishing failure, you also abolish the possibility of success, and guarantee only a huge sucking statist swamp. From Motown to no town, from the Golden State to Golden Statists. What happens when the policies that brought ruin to Detroit and decay to California are applied to the nation at large?
Nobody did this to Detroit. The city and its business and civic leaders did this to themselves. In once functioning parts of Africa, civil war, a resurgent Islam, and other forces have done a grand job of reversing all the progress of the twentieth century. But the deterioration of Sierra Leone or Somalia is as nothing compared to the heights from which Detroit has slid. Entire blocks are deserted, and the city is proposing to turn commercial land back into pasture—on the unlikely