
“Just Say No” to auto bailout
As a young staff member in the office of U.S. Secretary of Commerce Malcolm Baldrige, I was asked to help compile some documents for a senior staff meeting,who were going todiscuss the problems of the U.S. auto industry during the 1982 recession. When I asked my boss at the time if the focus of the discussion would be the auto industry’s constant caving-in to their labor unions, thus pricing low and moderate end autos out of the market in the face of heavy Japanese competition, he said, "oh no, we aren’t going to discuss labor; don’t include anything on the cost of labor, we are just going to talk about productivity."
Of course, productivity is labor. It is making labor more productive that creates better productivity. And the cost of laboris one of the biggest factors in whether it is ultimately productive.
But it was easier for the government to ignore the problem of high labor costs and the hard decisions needed to change union contracts, when they could have their meeting and talk about how robotscould help the ailing auto industry, rather than getting to the heart of the matter: a history of… Read More