Posts Tagged ‘Micheline Maynard’

First, let us pass in review:

(1) As Romney-apologists tell the story, Romney wanted to run as a competent technocrat, an outsider with the business experience and native genius necessary to “fix Washington.” Only Romney could never stay on message. So what the campaign emitted was unintelligible noise.

In the opinion of observers Romney had tried early on to position himself as a social conservative, only this ridiculously revisionist line never withstood any encounter with the facts of Romney’s record. Romney responded by tacking ever further to the right.

Romney outflanks himself yet again!–poll indicates Romney’s pull to the right alienates independents, centrists, and moderates

(2) After Iowa returned its decision for Gov. Mike Huckabee, Romney suddenly transformed into the “change” candidate.

(3) After New Hampshire returned its decision for Sen. John McCain, Romney transforms himself yet again. Romney abandons his social and economic conservative line altogether. Suddenly Romney wants to nationalize an ailing industry, only in the post-industrial, post-progressive era this assumes the form of a Washington-Detroit “partnership” combined with massive subsidies.

This is Romney himself from a Transcript of Romney’s Speech to the Detroit Economic Club

[...] “First of all, we have to be honest about the problems we have and tackle them head on. If I’m President of this country, I will roll up my sleeves in the first 100 days I’m in office, and I will personally bring together industry, labor, Congressional and state leaders and together we will develop a plan to rebuild America’s automotive leadership. It will be a plan that works for Michigan and that works for the American taxpayer.

“And as part of this, we will directly address and rectify the enormous product cost and capital cost disadvantages that currently burden the domestic automakers. From legacy costs, to health care costs, to increased CAFE standard costs, to the cost of embedded taxes, Detroit can only thrive if Washington is an engaged partner, not a disinterested observer. The plan is going to have to include increases in funding for automotive related research as well as new tax benefits including making the Research and Development Tax Credit permanent.

“I am not open to a bail out, but I am open to a work out. Washington should not be a benefactor, but it can and must be a partner [...]

In an article titled Romney on the Ropes, Byron York of the National Review comments:

[...] [Romney's] plan is to make the United States government a virtual partner of Ford, GM, and Chrysler. “If I’m president of this country, I will roll up my sleeves in the first 100 days I’m in office, and I will personally bring together industry, labor, Congressional and state leaders and together we will develop a plan to rebuild America’s automotive leadership,” Romney tells the Economic Club. “It will be a plan that works for Michigan and that works for the American taxpayer.”

The plan would involve easier-to-reach mileage standards, increased funding and extended tax breaks for research and development, worker health care reforms, and more. “Detroit can only thrive if Washington is an engaged partner, not a disinterested observer,” Romney says. “I am not open to a bail out, but I am open to a work out. Washington should not be a benefactor, but it can and must be a partner.”

Romney’s proposals might not be music to the ears of free-market conservatives who believe Detroit made its own problems and needs to fix itself. But it’s what a lot of people in Michigan want to hear [...]

Might not be music to our ears? Here be the problem, and it has little to do with Romney’s tone deafness: Not only does Romney’s plan to nationalize the US automobile industry reflect yet another complete ideological reversal for the hapless candidate—Not only is Romney’s proposal impracticable and nearly impossible on its face, just the worst possible public policy imaginable—Not only will Romney’s proposal issue into in a furious race to the bottom as Romney himself and the other candidates are forced to out-bid each other promising to bail-out, subsidize, or protect from competition other ailing industries and entire economic sectors—but Romney’s plan for MI is also based on a risibly inaccurate and historically flawed assessment of an already globalized and post-industrial US automobile “industry”. Micheline Maynard of NYT’s The Caucus outlines the case against Romney’s proposals in an article titled Romney Address a Car Industry That Has Changed:

[...] Mr. Romney’s speech to the Economic Club of Detroit on Monday seemed more rooted in a time when Detroit companies dominated the automotive scene, rather than now, when Toyota is No. 2 behind General Motors.

For example, Mr. Romney vowed that if elected, “in my first 100 days, I will roll up my sleeves, and I will personally bring together industry, labor, Congressional and state leaders to develop a plan to rebuild America’s automotive leadership.”

But America’s auto industry now is no longer exclusively American. It includes Toyota, Honda, Nissan, as well as the leaders of European and Asian automakers. All have built factories in the United States over the past 25 years, particularly in states across the South. Collectively, foreign companies held 48.9 percent of American sales last year, when Detroit’s market share slipped to 51.1 percent, its lowest ever.

Mr. Romney also referred to a series of areas where the industry ought to engage with Washington, ranging from its pension and health care expenses, known as legacy costs, to mileage standards, known as corporate average fuel economy, or CAFE.

“From legacy costs, to health care costs, to increased CAFE standards, to embedded taxes, Detroit can only thrive if Washington is an engaged partner, not a disinterested observer,” Mr. Romney said.

However, G.M., Ford Motor and Chrysler reached contracts with the United Automobile Workers union last fall that will shift their burden for retiree health care costs, the major portion of legacy costs, to an independent trust that will be administered by the U.A.W. Moreover, the companies and the union pledged to spend money creating a new think tank that will lobby for federal health care reform.

Speaking of fuel economy, Mr. Romey said, “Of course fleet mileage needs to rise, but discontinuous CAFE leaps, uncoordinated with the domestic manufacturers, and absent consideration of competitiveness, kills jobs and imperils an industry,”

Mr. Romney added: “Washington-dictated CAFE is not the right answer.”

But the auto companies just finished taking part in a spirited Congressional debate over CAFE during 2007. And while they fought increases in fuel economy standards early on, the automakers wound up supporting the new law that requires them to achieve 35 miles per gallon by 2020.

Mr. Romney also had a vintage perspective on his father’s former company, American Motors.

“I used to ask my dad, ‘How in the world can you compete as head of America Motors when you’ve got such huge competitors, GM, Ford, Chrysler, the Big Three — how do you possibly think you can succeed?’” Mr. Romney said. “And he’d say in a way that I have not forgotten: ‘Mitt, there’s nothing as vulnerable as entrenched success. There’s nothing as vulnerable as entrenched success.’”

Yet it was A.M.C. that was vulnerable in its final years. It first turned to Renault of France for a rescue, selling a 46 percent stake to the French auto company in 1980, earning it the nickname, “Franco-American Motors.” In 1987, Chrysler purchased A.M.C. from Renault, and the company vanished from the automotive scene [...]

Back to Byron York:

[...] From the beginning of his campaign, Romney has argued that he is the only candidate who can unite the three main elements of the Republican party: economic conservatives, national-security conservatives, and social conservatives. But Romney is really mostly an economic conservative; his foreign-policy credentials aren’t much, and his social conservatism — highlighted by the famed flip-flop over abortion — has earned him as many critics as fans. That hurt him in Iowa and New Hampshire, but on the last day of the campaign in Michigan, it’s economy, economy, economy, and that is where Romney is strongest [...]

Remarks:

(1) Contra York, the National Review itself argues that Romney “is the only candidate who can unite the three main elements of the Republican party: economic conservatives, national-security conservatives, and social conservatives.” See:

So here you have York, a writer for the National Review, arguing that Romney really isn’t a conservative at all—correction: York argues that Romney is really only an “economic conservative,” even though Romney’s policies, as York admits with his “music” comment, are anything but conservative. What does this say about the goof-balls at the National Review!?

(2) Romney’s proposal for the US automobile industry is not economic in content or in character—this is not an economic proposal.

It is a political proposal.

It assumes in advance that the performance or non-performance of a US industry is a political question. It assumes in advance the priority of political agency over private activity. And it arrives at the conclusion that the US taxpayer should subsidize the wrongheaded and shortsighted decisions of US automobile executives, and that Washington should supervise—as a partner—and assume the costs of, an entire economic sector.

So why should Romney’s proposal not apply also to e.g. US agriculture, or the technology sector? This is the logical contradiction of Romney’s proposal: it admits of no conceptual limit or limit in principle. It is not enough to argue that the automotive industry is the “canary in the coal mine” for the US economy and therefore deserves special attention—every sector of the economy, it can be argued, is vitally important—that’s part of what it means to be an economy—every sector is interrelated, interdependent.

The empirical contradiction of Romney’s plan is this: it cannot be done. History has already returned its verdict on heavy industry as an economic driver. The cash value of manufactured goods has declined for the past 25 years. Industrial capacity is more generally distributed in the world. Information processing technology and technique drives up productivity so more can be made with less labor, and this drives down prices—etc., etc.—no longer can heavy industry be the material basis of the US middle class. It is simply impossible at this historical stage.

Romney’s plan is not merely government activism, it is government atavism. It is an attempt to reverse history.

Our conclusion: Romney is not a conservative. Not in any sense of the term. Also: Romney has successfully bought a primary contest by issuing a check he cannot possibly cash.

Michigan belongs to Romney now. He can have it.

yours &c.
dr. g.d.

P.S. Credit goes to eyeon08.com for the Byron York article.





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