A key provision of the auto maker rescue package (which passed the house last night and is now headed for the Senate) is the requirement that the car companies surrender some of their management control to the government. Yes, who better than federal government legislators and regulators to bring efficiency and accountability to a troubled industry?
Within the last few days, I’ve heard and read a number of people excitedly discussing the idea of the feds putting Apple’s Steve Jobs in charge of GM to straighten the company out.
This origin of this shiny piece of brilliance seems to be Thomas “The World is Flat” Friedman.
Friedman is reputed to be some sort of futurist genius, but I must say, the more I hear and read him, the less I get what all the fuss is about.
But I digress.
Behind Friedman’s and everyone else’s enthusiasm for putting Steve Jobs in charge of GM is a deeply flawed assumption. Namely, that GM’s primary problem is leadership/management.
The accepted wisdom is that the car companies are run by imbeciles with no imagination.
Of course, the real problem for America’s car companies can be summed up in a single word:
It is no coincidence that America’s most troubled industries are her most unionized. The airlines and the automakers are hopelessly entangled in miles and miles of innovation and efficiency-stifling contracts, collective bargaining agreements, and pension commitments.
For decades, strikes and strike threats have strong-armed auto makers into agreements that destroy the companies ability to adapt quickly and respond proactively to changing market conditions.
Sure, nationalize the car industry and put Steve Jobs in charge. Nothing will change. It can’t as long as the big three are locked into paying assembly line workers $74/hr on average.
Get rid of the outdated, obsolete, uneccesary unions and their coercive power . . . and I could run GM profitably.