America's Big Three deserve help from America

As a native of Highland Park, Michigan, the birthplace of the American auto industry and home to the original assembly plant that produced the first Ford Model T cars, I am appalled that so many are ready to shove the "Big 3" into oblivion.

This past week we watched again as members of Congress berated the executives of GM, Ford and Chrysler. We've all heard the complaints about making cars that are not "green" or producing big cars when we are a fuel-challenged or energy-challenged country. But in fairness, America has to look at the entire picture to get a better understanding. 

First, we could start with the terminology: it's a loan--to be paid back with interest--not a bailout.

Second, this is not the 1970s of vehicular largess. There was a time when American automakers were making bad cars. That time has come and gone. 

The problems of the 70s ceded after Chrysler landed a near $2 billion loan guarantee 19 years ago this month when Congress (spearheaded by a young Michigan Congressman named James Blanchard) passed the "Chrysler Corporation Loan Guarantee Act." With Lee Iacocca at the helm, the introduction of the K-car platform, and the popular new mini-vans selling, Chrysler paid off the loan in 1983, ahead of schedule. The government got its cash back with interest and actually made money off the extension of help to Chrysler.

Later, Ford would come out with the Taurus which became a standout and favorite of car buyers the world over. General Motors gave us Saturn which put GM back on track to making responsible, safe and enduring vehicles. More recently, Ford has the ever dependable Fusion which, (full disclosure, I own one) is a splendid vehicle that comes, even fully loaded, at a reasonable price and gets good gas mileage. 

Third, if America is to compete it has to have a "level playing field." As Sen. Carl Levin (D-Mich.) points out, foreign capitals are providing billions in loan guarantees to foreign car companies facing similar problems. Further, the United Auto Workers Union President Ron Gettlefinger points out many foreign companies set up shop here knowing that the battle to win their business will yield states providing unheard of incentives. Gettlefinger says since 1992 states have put in more than $3 billion dollars in incentives. In Alabama for example, Hyundai Motor Company has received $252 million in incentives. Toyota there has gotten $29 million in incentives; Honda, $158 million; and Mercedes $253 million. 

Yes, America's automakers have a lot to learn from their foreign counterparts, however, it would be foolhardy to abandon them. My dad worked for "Fords" most of his adult life, and both my father and mother drove Chevy Impalas while I was growing up in Metro Detroit, so perhaps you could say I'm biased. Maybe so. But my vent this week about the so called "bailout" is rooted in the fact that in Washington and in the cushy corridors of New York Banks and financiers lays a depository of hypocrisy and classism.

I don't recall Senators or Congressmen asking Citicorp executives to come and grovel to get a bailout. Do you? They got $25 billion. Former Secretary of the Treasury Robert Rubin has earned in the neighborhood of $120 million from Citigroup where he was the architect of the company's strategy of taking on more risk in debt markets--which has led to its near collapse. Rubin, however, wasn't called up to the Hill to explain what went wrong and why--or how Citigroup was going to spend its taxpayer-funded handout--let alone its plans for recovery. So why did the auto execs get dressed down? Why did House leaders demand that they "show us the plan . . . before we show them the money?" Sure they flew in jets for their first hearing, which was a PR nightmare, and then overcorrected by driving to DC last week. But really, how many members of Congress drove to Washington after the Thanksgiving break? Even House Speaker Nancy Pelosi has a taxpayer-funded jet that flies her from Washington to her home in California. 

One more thing: while it's easy to blame the "suits" for the problems, and yes they are the heads of these companies, let's remember who will really hurt if we allow GM, Ford and Chrysler to go under. It will be the more than 3 million people who have jobs that are directly or indirectly connected to the American-owned car companies. We're talking dealerships, parts and services companies, and more.

You think we are in a financial mess now. Imagine if we added another three to four million people to the jobless rate that was just released Friday by the Labor Department. The Bureau of Labor Statistics commissioner testifying before Congress' Joint Economic Committee said it's the worst jobs report since the beginning of the Bureau--124 years ago.

Despite all that, there are still many legislators like Sen. Richard Shelby (R-Ala), who maintain a hardened position calling for the Big Three to go bankrupt or "out of business." Perhaps they have forgotten American history. It was the industrial midwest autoworkers, the rust belt steelworkers and coal miners who built what we call, and many of us still have pride in saying, "made in the USA." 

Lest we forget, long before Toyota, Honda, or Hyundai were investing in America, it was Henry Ford, Walter Chrysler, and Billy Durant who paved a path for all of America. Not to mention that it was GM that helped us win World War Two when it converted 100 percent of its production to the Allied war effort in 1942.

Perhaps these lawmakers maintain their disdain for Detroit, because the bankrupt scenario could prove beneficial to the foreign car companies with plants and operations in their states or congressional districts. Isn't it a shame that on the eve of an historic inauguration, where so many Americans of different stripes and colors have come together for change and hope,  that we have some U.S. lawmakers calling for the demise of a genuine American industry that helped build and make America great. 

Detroit deserves better than that.

Hopefully Washington will deliver.