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  1. #1 Let Detroit Go Bankrupt by Mitt Romney 
    Let Detroit Go Bankrupt
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    By MITT ROMNEY
    Published: November 18, 2008
    Boston
    IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.

    Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.

    I love cars, American cars. I was born in Detroit, the son of an auto chief executive. In 1954, my dad, George Romney, was tapped to run American Motors when its president suddenly died. The company itself was on life support — banks were threatening to deal it a death blow. The stock collapsed. I watched Dad work to turn the company around — and years later at business school, they were still talking about it. From the lessons of that turnaround, and from my own experiences, I have several prescriptions for Detroit’s automakers.

    First, their huge disadvantage in costs relative to foreign brands must be eliminated. That means new labor agreements to align pay and benefits to match those of workers at competitors like BMW, Honda, Nissan and Toyota. Furthermore, retiree benefits must be reduced so that the total burden per auto for domestic makers is not higher than that of foreign producers.

    That extra burden is estimated to be more than $2,000 per car. Think what that means: Ford, for example, needs to cut $2,000 worth of features and quality out of its Taurus to compete with Toyota’s Avalon. Of course the Avalon feels like a better product — it has $2,000 more put into it. Considering this disadvantage, Detroit has done a remarkable job of designing and engineering its cars. But if this cost penalty persists, any bailout will only delay the inevitable.

    Second, management as is must go. New faces should be recruited from unrelated industries — from companies widely respected for excellence in marketing, innovation, creativity and labor relations.

    The new management must work with labor leaders to see that the enmity between labor and management comes to an end. This division is a holdover from the early years of the last century, when unions brought workers job security and better wages and benefits. But as Walter Reuther, the former head of the United Automobile Workers, said to my father, “Getting more and more pay for less and less work is a dead-end street.”

    You don’t have to look far for industries with unions that went down that road. Companies in the 21st century cannot perpetuate the destructive labor relations of the 20th. This will mean a new direction for the U.A.W., profit sharing or stock grants to all employees and a change in Big Three management culture.
    Very interesting article!

    More at the link.
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  2. #2  
    Senior Member Molon Labe's Avatar
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    It's good to see Romney writing pieces like this again. Gives me hope for the conservative future.
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  3. #3  
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    If the government gives Detroit any money, it will want to dictate what Detroit HAS to produce whether we want to buy it or not. Since when has the government dictating anything worked out for the betterment of anything at all.
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    Mr Romney's plan sounds good but it will never work. Management and the unions are so entrenched in their own stupidity and greed. Let them go under and maybe Toyota, Honda or some other entity will take them over without union employees and astronomical benefits.
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  5. #5  
    Super Moderator BadCat's Avatar
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    Quote Originally Posted by Speedy View Post
    If the government gives Detroit any money, it will want to dictate what Detroit HAS to produce whether we want to buy it or not. Since when has the government dictating anything worked out for the betterment of anything at all.
    There was some moonbat talking head on Fox this morning saying just that...IF the government can make Detroit make, her words now..."green cars", the bailout money will be worth it.

    I guess the libs have never seen a Lada.

    rm -rf obama*
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  6. #6  
    Senior Member NonConformist's Avatar
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    And Mitt Romney aint no conservative!
    "Those who would give up essential liberty to purchase a little temporary safety deserve neither liberty nor safety." - Benjamin Franklin

    "Necessity is the plea for every infringement of human freedom. It is the argument of tyrants, it is the creed of slaves." -William Pitt




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  7. #7  
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    Quote Originally Posted by NonConformist View Post
    And Mitt Romney aint no conservative!
    He is posturing for a re-run in 2012. RINO's is what has screwed the Repub. party up.
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