Beyond the Spin: Contradictions on auto mess

Watching the CEOs of the Big Three automakers clumsily beg for a $25 billion loan has been highly entertaining.

Last week, Rep. Brad Sherman took a turn as ringmaster of a circus masquerading as a congressional hearing. "I'm going to ask the three executives here to raise their hands if they flew here commercial," the California Democrat said. Neither Rick Wagoner of General Motors, Robert Nardelli of Chrysler, nor Alan Mulally of Ford raised a hand.

"Second, I'm going to ask you to raise your hand if you're planning to sell your jet . . . and fly back commercial." Again, no hands.

Sherman bellowed, "Let the record show no hands went up."

Rep. Gary L. Ackerman (D., N.Y.) was equally colorful.

"There's a delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hands," he declared. "It's almost like seeing a guy show up at the soup kitchen in a high hat and tuxedo. . . . I mean, couldn't you have downgraded to first-class or jet-pooled or something to get here?"

Many members of Congress missed the point by attacking CEOs of Fortune 500 companies for traveling on corporate jets. Did they expect them to travel by bus? Should they have squeezed into the same VW?

Sure, many of Detroit's wounds were self-inflicted. And a strong case can be made either for letting the Big Three go into bankruptcy or for providing them with a $25 billion bridge loan.

But we need to look beyond the CEOs and consider our often contradictory public policies. For example, federal policymakers say they want the public to conserve gas. At the same time, however, needed road repairs are made possible by gas taxes.

The federal government's primary fund for highway, bridge and transit projects was down $3 billion over the first 11 months of fiscal 2008. That's because Americans drove 90 billion fewer miles than during the same period last year.

In a rare display of public candor, Transportation Secretary Mary Peters said in a statement: "Our current approach has us encouraging Americans to change their driving habits and burn less fuel, while secretly hoping they drive more so we can finance new bridges, repair interstates, and expand transit systems." She added, "We need a new approach that [complements], instead of contradicts, our energy policies and infrastructure needs."

That's not the only contradiction. We also say we favor a strong middle class. The postwar expansion of the American middle class owes much to the United Auto Workers' demands for decent wages and benefits. But now unions are being blamed for the Detroit's problems.

Although U.S. automakers don't enjoy an even playing field in many of the foreign countries where they compete, Toyota, Honda, Mitsubishi, Kia and BMW face no such impediments in the United States. The foreign automakers tend to locate their plants in Southern states with relatively little unionization, offering lower wages and benefits than the American companies do.

Along the way, the foreign manufacturers have developed strong political backing.

Consider the words of Alabama Sen. Richard Shelby, a Republican whose state is home to Mercedes-Benz, Honda and Hyundai plants:

"The Big Three's financial straits are not the product of our current economic downturn, but instead are the legacy of the uncompetitive structure of their manufacturing and labor force," Shelby said in a statement. "The financial situation facing the Big Three is not a national problem, but their problem. I do not support the use of U.S. taxpayer dollars to reward the mismanagement of Detroit-based auto manufacturers in such a way that allows them to continue and compound their ongoing mistakes."

Washington Post auto writer Warren Brown attributes the success of foreign automobile makers to what he calls "the Wal-Mart effect."

"American consumers, in their passionate pursuit of the very best goods at the lowest possible price, have undermined their own economic well-being," he wrote. "It is difficult to maintain high salaries and premium health and pension benefits in a business environment built on profitably moving a maximum number of high-quality products at bargain prices. Something has to give."

Brown concluded, "If consumers can get great cars from Toyota or Honda free of the costs associated with United Auto Workers union-represented labor at General Motors, well, that is what they're going to do. They're not going to look for the union label, let alone pay more for it."

As Congress debates whether to give the Big Three $25 billion, it's time to reexamine many of our contradictory goals and attitudes.