Reading Between the Lines

Vitality shows in not only the ability to persist, but the ability to start over.

–F. Scott Fitzgerald (1896-1940)

In an op-ed piece running in The New York Times today, former Massachusetts Gov. Mitt Romney (R), who fought John McCain for the GOP presidential nod, makes a cogent case for letting Detroit’s Big Three go bankrupt.

That is not the prescription I offered here yesterday by any means. But I have to say that despite having governed a New England state, Gov. Romney knows a whole lot more about how Detroit works than most people. According to the governor, his father, George Romney, who also ran for president (in 1968) and was himself Governor of Michigan (1963-69), is still studied in business schoools for how he saved American Motors Corp. (AMC) back in 1954.



George, the first Gov. Romney to run for president, knew a bit about saving Detroit too

On top of that, Mitt himself has that whole saviour-of-the-Salt-Lake-Olympics thing going for him so I am quite willing to concede he may have the far better idea on what to do about Ford, GM and Chrysler. And that he also admits to being a car nut– which I daresay most of us in trucking tend to be to one degree or another– stands him well in my estimation.

Anyway, it is Mitt’s view that if the Big Three get bailed out, “you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.” Those are the harshest words I ever heard the gentlemanly Governor utter, but he is addressing a subject worth getting worked up over.

Romney argues that given a bailout, the Big Three “will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.”

Romney goes on to lay out a multi-part plan he says the Big Three should follow to dig themselevs out of the ditch.

He then states they are not wrong to ask for federal aid, “but the automakers should come up with a win-win proposition. I believe the federal government should invest substantially more in basic research — on new energy sources, fuel-economy technology, materials science and the like — that will ultimately benefit the automotive industry, along with many others. I believe Washington should raise energy research spending to $20 billion a year, from the $4 billion that is spent today. The research could be done at universities, at research labs and even through public-private collaboration. The federal government should also rectify the imbedded tax penalties that favor foreign carmakers. But don’t ask Washington to give shareholders and bondholders a free pass — they bet on management and they lost.”

Romney calls his tough-love prescription a “managed bankruptcy” and suggests his way “may be the only path to the fundamental restructuring the industry needs. It would permit the companies to shed excess labor, pension and real estate costs. The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.”

He adds that in a managed bankruptcy, “the federal government would propel newly competitive and viable automakers, rather than seal their fate with a bailout check.”

Mitt may well be right. Anyway, we do agree that, as he put it, “the American auto industry is vital to our national interest as an employer and as a hub for manufacturing.” And, like me, he thinks the top managment of the Bg Three ought to– how can we say this diplomatically?–make way for new leaders.

What’s right about America is that although we have a mess of problems, we have great capacity– intellect and resources– to do something about them.

–Henry Ford

Girding itself for the political equivalent of war, the Ford Motor Co. has prepared an explosive internal document that details the massive ripple effect its failure would potentially have on the U.S. economy in terms of thousands of jobs being lost in every state.

If you did not believe so before now, then learning of this eyeopening little missive may convince you that the mess the automakers have gotten themselves into– with the hearty help of all of us who could not buy enough SUVs and “personal use” pickups these last 20-odd years, I will add– ain’t just Detroit’s problem.

As reported in The Wall Street Journal today, the analysis shows that 25 states could lose 3,000 Ford-related jobs or more if the auto maker were to disappear. And let’s underscore that would be Ford-related job losses only– if Chrysler and GM go down as well, there would be plenty more to worry about.

“To be sure, the job loss would be felt most acutely in the nation’s Rust Belt,” writes Matthew Dolan in his Journal piece. “In Michigan, Dearborn-based Ford employs 38,380 auto workers and relies on 3,111 auto parts suppliers, according to the document. In Ohio, the numbers are also high, with 8,540 workers at Ford. But a state like Kentucky would also feel the pain, with 5,615 employees working directly for Ford. Thousands more employees who work for suppliers and dealers at Ford would only add to the potential job loss.”

Food for thought: One can only imagine what Henry thinks of today’s Detroit!

The Ford analysis was no doubt rushed into production as the head honchos of the Big Three have apparently come to realize (boy, do they realize anything early on?) they must sway Congress– and the public opnion that sways Congress!– beyond the Michigan delegation if they hope to get any kind of federal bailout before it’s simply too late for them to stave off disaster.

In his report, Dolan pointed out that, “The companies’ poor earnings posted earlier this month make it clear Ford and GM are running out of money to finance their Michigan-based businesses, with GM the sicker of the two. Less is known about Chrysler, which is privately held.”

That’s why the PR machine in Detroit is being ratcheted up to its highest level perhaps ever. And before being accused of carrying their water, let me say I for one don’t know whether Ford’s or GM’s or Chrysler’s numbers should be trusted or their arguments for federal help should be embraced.

But I don’t see how our economy– already reeling from what the too-slick-for-their-own-good operators in the financial arena did aided and abetted by the “free market” thinkers who had the run of our federal regulatory agencies the the past eight years– can withstand the shock of one or more U.S.-based automakers going belly up.

And business and politics aside, I just can’t see the United States of America without any American car makers!

Think about it. No more Crown Vic police interceptors lurking everywhere? No F150s or Chevy Silverados hauling everything anywhere across America? No Mustangs, no Corvettes, for crying out loud, anywhere ever again?

OK, so maybe what Washington needs to do is force the Big Three to bring in new top managment and then park them in a conference room somewhere until they can hammer out a plan to build one potentially succesful American car maker out of the bones of the three that are so publicly dying right now.

They could call the new firm U.S.A. Motors and put into it the best brands– and above all, products– that the former Big Three still have left (and I could name more than a few) and then sally forth to take on the world all over again.



Could there be a U.S.A. Motors in our future?

That’s my best shot.

It ain’t perfect and I make no claim to knowing how to actually implement it.

At least it’s a big idea.

And, in my defense, I would surely have to argue that there just doesn’t seem to be many of those rolling out of Detroit these days, now does there?

News Flash… According to Reuters: “Ford Motor Co, scrambling for cash as the U.S. Big Three automakers struggle to stay alive, will end 12 years of control of Mazda Motor Corp through the sale of a 20 percent stake in the Japanese carmaker for around $540 million. Ford will remain Mazda’s top shareholder with a stake of just over 13 percent.”

“We do our best to make Black Friday a fun, festive time for our customers, including hundreds of hours of training to get ready for the day.”

–from news release issued by mega-retailer Best Buy, October 2008

A headline writer or talking head somewhere got all cutesy a few years back when times were seemingly so flush that he or she )and without consulting me!) went and thoughtlessly re-christened as “Black Friday” what was perfectly adequately known when I was growing up as the Day after Thanksgiving.

Writer that I may be, it took me awhile to grasp the positive significance of that title as all the “black days” that came before it in human history deployed that huer as an adjective because, hell, they were pretty awful days. In this context, and from not so long ago I might add, “Black Monday” leaps to mind– October 19, 1987, the day when stock markets around the world crashed, shedding a ton of value in a very short time.

While we’re at it, let’s not forget the biggest and baddest of them all: “Black Thursday,” which denotes several awful events including the Wall Street crash of October 24, 1929 that precipitated the Great Depression and October 14, 1943, when the Allied Air Forces suffered large losses during the second massive bombing raid on Schweinfurt, Germany. Geez, maybe we should all just be glad it’s November!

But, lucky me, I bet I won’t have to roll my eyes at the absolute dopiness of calling a day “black” for black ink because it is a big day in retail–at least not this year!

Nope, I am fully prepared for it to be renamed Red Friday for the huge comparative sales declines retailers will report if Americans stay away from shopping in droves this holiday season.

To be sure, the experts are warning it will be a season for Scrooges. But perhaps we can take some small comfort in knowing it won’t be so out of miserliness for too many millions of people, but out of necessity.



No time for Scrooge (Albert Finney in “Scrooge,” 1970)

That being said, we’d all be enriched by trying to do whatever we individually can this holiday season for the less fortunate among us– be it by donating to a church or favorite charity or more directly by dropping supplies off at a food bank or just plunking spare change or a few bills in one of those familiar red kettles manned by bell-ringers that should start popping up outside stores any day now…

For in life, if not in trucking, what goes around comes around.

Success is how high you bounce when you hit bottom.

–Gen. George S. Patton, U.S. Army (1885-1945)

You got to hand it to Treasury Secretary Henry Paulson. Realizing that the original plan for how to use the $700 billion ponied up by Congress to bail out the financial market– which was essentially to buy up bad mortgages in hopes banks would start lending again– was going nowhere fast, he has smartly shifted gears.

Paulson now hopes to establish a major new lending program, to be run by the Fed, intended to unlock the frozen consumer credit market.

Makes sense to me. Like John McCain, I make no claim to understanding how our economy works (does anyone really?) but you can be as sure as the sun setting today that if you put billions of dollars within reach of American consumers,they will climb all over each other to get hold of it. If it comes in the envisioned form of credit, so much the better. Much neater than handing out fistfuls of dollars on street corners anyhow.

The Treasury hopes to invest about $50 billion from the bailout fund into the new loan facility, according to a report in The New York Times today, with the aim being to help companies that issue credit cards, make student loans and finance car purchases.

“As envisioned,” according to the newspaper, “the Treasury would put up about 5% of the money that a company would use for lending and private investors would put up perhaps 20 times that much by buying bonds issued by the new program.”

It’s rusty but it will work…

No matter how this new consumer deal will work, it had better work.

Thinking positively, I can’t see how better the government can prime the pump than by letting the great American consumer– the true engine of our current economy, like it or not– jump up and down on the handle.

The best things in life are free…

But you can keep ‘em for the birds and bees.

Now give me money (that’s what I want)

That’s what I want (that’s what I want)

That’s what I want (that’s what I want), yeah

That’s what I want

–lyric from “Money (That’s What I Want)” by Berry Gordy and Janie Bradford

Detroit– and by that we mean America’s Big 3 automakers, GM, Ford and Chrysler– may be hoping like crazy that it can soon drive right up to the federal feeding trough (gold-plated so recently by Wall Street bankers to the tune of $700 billion!), but there’s no guarantee it will get its fill. And it’s very likely that even if the Big Three do fill up, the sustenance won’t come without plenty of unappetizing strings attached.

Certainly, it is hard to imagine that anyone in trucking would not want Detroit to get whatever assistance it needs to stay afloat. For starters, a hell of a lot of trucking frieght is automotive-based. On top of that, the vehicle and equipment suppliers to trucking that are not owned by the Big Three are interlinked with them in some way or another.

And then there’s that chilling stat underscoring Detroit’s economic footprint that keeps popping up in the media lately: one in ten jobs in the country is affected by the domestic auto industry, at least according to Michigan Governor Jennifer Granholm (D).

Workers arriving at Ford’s River Rouge plant, circa 1944

The Big Three must be cheered at least a bit by at last having their plight break onto the front pages as it were– and especially by hearing that influential voices are starting to speak up in favor of some sort of federal bailout or rescue (take your pick).

For example, the U.S. Chamber of Commerce has indicated its support for Detroit via a letter penned by R. Bruce Josten, executive vp of government affairs, and sent both to Treasury Secretary Henry Paulson and Fed Chief Ben Bernanke.

Josten argues that “The current economic environment requires immediate government action to restore liquidity so that the U.S. auto industry is able to function, meet consumer demand, and develop new energy saving technologies.”

He goes on to say the Chamber believes powers granted to Paulson and Bernanke by the Emergency Economic Stabilization Act (EESA)– a.k.a the Wall Street bailout package– will allow them to take actions that will “support the distressed auto industry which is so essential to the U.S. economy.”

We can all be rightfully indignant at the Big Three for having screwed up so immensely– thoroughly ceding the incredibly massive competitive advantages they once held on these shores to foreign-based (and now laregly Americanized) automakers, but I simply do not see how we as a nation can stand idly by and let this essential industry collapse to the point that so many jobs will be lost… not to mention risking manufacturing production capacity that can be viewed as essential to our national security.

In Flanders fields the poppies blow

Between the crosses row on row,

That mark our place; and in the sky

The larks, still bravely singing, fly

Scarce heard amid the guns below.

We are the Dead. Short days ago

We lived, felt dawn, saw sunset glow,

Loved and were loved, and now we lie

In Flanders fields.

Take up our quarrel with the foe:

To you from failing hands we throw

The torch; be yours to hold it high.

If ye break faith with us who die

We shall not sleep, though poppies grow

In Flanders fields.

–Lt. Col. John McCrae, MD, Canadian Army (1872-1918)

Veterans Day is a very significant and solemn holiday but one with an odd history. It was originally observed as Armistice Day– intended simply to commemorate the day the awful guns fell silent at the eleventh hour of the eleventh day of November, 1918, ending the four years of brutal carnage that came to be known as the War to End All Wars or simply, World War I.

According to the U.S. Dept. of Veteran Affairs (VA), in November 1919, President Woodrow Wilson proclaimed November 11 as the first commemoration of Armistice Day with the following words: “To us in America, the reflections of Armistice Day will be filled with solemn pride in the heroism of those who died in the country’s service and with gratitude for the victory, both because of the thing from which it has freed us and because of the opportunity it has given America to show her sympathy with peace and justice in the councils of the nations…”

It was after World War II that Veterans’ Day as we now know it– a day to honor all those who have served in the Armed Forces of the United States and, I will add, the U.S. Coast Guard– came to be:

“An Act approved May 13, 1938, made the 11th of November in each year a legal holiday - - a day to be dedicated to the cause of world peace and to be thereafter celebrated and known as ‘Armistice Day,’” states the VA. “Armistice Day was primarily a day set aside to honor veterans of World War I, but in 1954, after World War II had required the greatest mobilization of soldiers, sailors, Marines and airmen in the Nation’s history; after American forces had fought aggression in Korea, the 83rd Congress, at the urging of the veterans service organizations, amended the Act of 1938 by striking out the word ‘Armistice’ and inserting in its place the word ‘Veterans.’ With the approval of this legislation (Public Law 380) on June 1, 1954, November 11th became a day to honor American veterans of all wars.”

Cover of a Korean War V.F.W. Magazine

That’s how we got to the now familiar Veterans Day, which is a great holiday to observe– especially if one is a veteran or is related to those who are, as am I.

But it seems to me, and this has nothing to do with trucking but so be it, that the war that ended exactly 90 years ago today is getting short shrift in this country in terms of official commemoration and news coverage. But not here. We all should pause today to reflect and pray for those Americans who served and suffered and especially for those who gave the ultimate sacrifice in that long ago but brutally horrible war that wiped away a generation of young men in Europe and helped usher the United States into its eventual role as the world’s policeman and pre-eminent moral force.

Maybe because I am something of a student of history, especially American military history, I often think about what our doughboys, sailors, Marines and fledgling airmen must have gone through in 1917 and 1918, thrust as they were so suddenly into the jaws of hell and expected to be the fresh blood to put an end to the unprecedented slaughter. I can of course only imagine what they witnessed and endured as well as what any veteran of any of our wars right up to now who served in combat have.

Doughboys on the Western front, circa 1918

As it happens, I have an interesting souvenir of the end of the Great War that was made by a German POW for my great uncle, John Rutledge Johnston, who served in France with the U.S. Army. It is a three-sided piece of scrap aluminum fashioned to wrap around a wooden box of matches as a case. It is decorated with nail punchmarks that spell out my uncle’s name on the short side and the top is adorned with a Maltese cross, the date “1919,” the name of the town they were in or near, “Fleury,” and some olive branches to boot. I don’t know anything else about it, except that Uncle Rut made it home OK and history books tell me that not all German POWs were repatriated until 1920.

And I’d be completely remiss this Veterans’ Day if I did not pause to salute at least three other relatives of mine who served Uncle Sam in wartime.

My dad, Raymond Cullen, who’s 85, got to tour Europe courtesy of the U.S. Army from 1943-45, gaining the rank of Technical Corporal and leaving his bootprints in England, France, Belguim and Germany. Like his aforementioned Uncle Rut, he guarded prisoners, too. In his case it was after the famed battle for the bridge at Remagen– the last then standing over the River Rhine.

My father’s oldest brother, my late Uncle Dud– Charles Dudley Cullen Jr.– sailed the Pacific far and wide as an able seaman in the United States Navy. And the middle brother, my Uncle Rut– John Rutledge Cullen– who is stoutly dealing with some old-age infirmities right now, is the Marine in the bunch. He fought his way across Guadalcanal and a few other picturesque places and like his brothers, speaks very little if at all about what he saw and experienced on the front line.

WWII GI cartoonist Bill Mauldin’s Willie and Joe–two dogfaces somewhere in Europe, circa 1944

To Dad and Uncle Rut and everyone else out there who has served our nation:

Thank you and Happy Veterans’ Day!

PS: And Happy Birthday to OMO, wherever you are!

To invent, you need a good imagination and a pile of junk.

–Thomas Edison, inventor extraordinaire

He’s not the first to say that what’s good for the environment can also be good for both the security and the economic well-being of our nation, but Vice President Al Gore makes that argument forcefully and persuasively today in an OpEd piece in The New York Times.

“Here is the good news: the bold steps that are needed to solve the climate crisis are exactly the same steps that ought to be taken in order to solve the economic crisis and the energy security crisis,” writes the Nobel Prize-winning politician. “Economists across the spectrum — including Martin Feldstein and Lawrence Summers — agree that large and rapid investments in a jobs-intensive infrastructure initiative is the best way to revive our economy in a quick and sustainable way. Many also agree that our economy will fall behind if we continue spending hundreds of billions of dollars on foreign oil every year. Moreover, national security experts in both parties agree that we face a dangerous strategic vulnerability if the world suddenly loses access to Middle Eastern oil.”

Gore goes on to argue the U.S. should “make an immediate and large strategic investment to put people to work replacing 19th-century energy technologies that depend on dangerous and expensive carbon-based fuels with 21st-century technologies that use fuel that is free forever: the sun, the wind and the natural heat of the earth.”

He then presents a five-point plan that he says will “repower America with a commitment to producing 100% of our electricity from carbon-free sources within 10 years. It is a plan that would simultaneously move us toward solutions to the climate crisis and the economic crisis — and create millions of new jobs that cannot be outsourced.”

Gore closes his argument by drawing a parallel to JFK’s robust challenge to the nation to literally shoot for the moon– issued when the U.S. still seriously lagged its Cold War rival in the “space race” launched in 1957 by the success of Sputnik and carried forth by the Russians in 1961 with first-man-in space Cosmonaut Yuri Gagarin.

“In an earlier transformative era in American history, President John F. Kennedy challenged our nation in 1962 to land a man on the moon within 10 years,” writes Gore. “Eight years and two months later, Neil Armstrong set foot on the lunar surface. The average age of the systems engineers cheering on Apollo 11 from the Houston control room that day was 26, which means that their average age when President Kennedy announced the challenge was 18.

That was in 1969– imagine what we can do now!

“This year similarly saw the rise of young Americans, whose enthusiasm electrified Barack Obama’s campaign.,” Gore continues. “There is little doubt that this same group of energized youth will play an essential role in this project to secure our national future, once again turning seemingly impossible goals into inspiring success.”

I don’t know if our environmental, security and economic issues can be solved by fresh thinking in a sort of grand triple play in green, but I for one am truly excited about seeing what today’s young Americans will ultimately devise to enable our nation to meet today’s pressing challenges as it has all those that have come before.

And so I ask, why should we not shoot for the moon… again?

There’s no mistaking the snap of electricity in the air as the Obama-Biden team slips into high gear to ensure one of the quickest–and, I think we all hope, smoothest–transitions of power in the last 40 years if not all of U.S. history.

I’d be remiss not to pause here and salute President Bush for echoing the incredibly gracious concession speech by Senator McCain Tuesday night and demonstrating, too, that he understands just how awesome the power of the Presidency is by flat-out instructing his White House staff yesterday to do all in their power to ensure a swift and sure transfer of the keys to the executive branch to President-elect Obama and his incoming Cabinet.

“For the next 75 days, all of us must ensure that the next president and his team can hit the ground running,” the President said in an emotional speech to hundreds of employees of the executive branch, reported The New York Times. He urged staffers to “conduct yourselves with the decency and professionalism that you have shown throughout my time in office.”

But amid all the media coverage of the speculation about who will be tapped to fill key posts in the Obama Adminstration, not to mention the ghastly post-mortem being done on the spectacularly failed McCain-Palin bid, you may not have heard that Speaker of the House Nancy Pelosi (D-CA) has read the election tea leaves to mean Americans want something more done on the economy now, if not sooner.

House Speaker Nancy Pelosi (D-CA) and Majority Leader Steny Hoyer (D-MD), right, at meeting with auto executives yesterday

Pelosi is calling for a two-part stimulus package , according to The Wall Street Journal. This effort would be aimed not at rescuing Wall Street but jump-starting the Main Street economy most of us live in day to day.

Her one-two punch would consist of a $60 to $100 billion stimulus package to be passed this month followed early next year by a measure that would include a “permanent” tax cut.

“‘The economy needs something sooner’ than next year, Rep. Pelosi said, adding that any measure enacted in a lame-duck session of Congress this month would be a down payment on additional stimulus enacted later,” reported The Journal.”‘”Let’s see if we can’t do something, working together now, that gives us a two-month jump,” she said. “We’ll take the longer view as soon as we take over in January.’”

According to the newspaper report, Pelosi said a tax cut would have a more immediate impact on the economy. “The impact is faster than a rebate, which takes a few months to get into people’s hands,” she said.

Whatever the mechanism. it is obvious that with the economy now by anyone’s measure in a severe recession anything that can be done to get money flowing– and bear in mind consumers, not bankers, are the true lifeblood of this economy– should be seriously considered by Congress… which just might wind up being the least Lame Duck Congress there ever was.

In a completely rational society, the best of us would be teachers and the rest of us would have to settle for something else.

–Lee Iacocca,

It should shock no one that Detroit’s Big Three automakers along with the UAW are beseeching Washington for some kind of emergeny financial aid. After all, the titans of the auto industry need only point to the unprecedented rescue package put together by Treasury Secretary Paulson and Congress to stave off the collapse of Wall Street as a justifiable precedent for their request.

According to a report in The New York Times , Rick Wagoner, chairman of General Motors; Alan R. Mulally, chief executive of Ford; Robert L. Nardelli, chairman of Chrysler; and Ron Gettelfinger, president of the UAW, will meet today with Speaker of the House Nancy Pelosi (D-CA) as well as “legislators from states with heavy automotive employment.”

The sit-down comes on the heels of the Dept. of Energy’s annoucement late yesterday that automakers would be able to apply as soon as next week for $25 billion in low-interest loans to develop more fuel-efficient vehicles. But, pointed out the Times report, “that loan program seemed unlikely to meet their needs, and some of the money could go to Asian carmakers with plants in this country.”

Something to be proud of made in the USA: 1963 Oldsmobile 98

I have no idea what Madame Speaker will or won’t promise Detroit let alone what Congress can ultimately deliver given the firestorm of constituent protest many House members had to run through in order to vote “yes” on the Wall Street bailout.

On the other hand, I can’t see how politically astute it would be for any officeholder to let Detroit sink and take with it not only countless jobs, but also over a hundred years of American prowess as one of the foremost– if not the greatest– producer of the horseless carriage.

There are those who look at things the way they are, and ask why.

I dream of things that never were, and ask why not?

–Robert F. Kennedy (1925-1968)

Last night at approximately 11 pm EST, history was made as Senator John McCain, a bona fide war hero and truly an American for all seasons, strode purposely to the podium on the magnificent stage set up under a starry Arizona sky in anticipation of his victory to make one of the most graceful and eloquent concession speeches ever made.

And by so doing, this battered but unbowed son of the United States Navy helped chart a course the entire nation would be wise to follow. That is, after the longest and most expensive presidential campaign in American history, it is time to put away the brickbats and slip the political machines into neutral long enough for the new president-elect to begin to govern.

Because, in the end, no matter how many historical firsts are scored in any election, the American people ultimately choose a President because they want a leader who will not politick endlessly by being divisive but who will govern by seeking to bring us together as much as humanly possible for common cause.

President-elect Barack Obama on the campaign trail

There’s no denying our great nation faces an uphill slog as we continue to deal with a host of issues– from the economy to foregn affairs and national security to climate change and so much more– and in my view there is no better way to make progress on these many fronts than by doing so not as citizens of blue states and of red states, but as citizens of the United States of America.

“…there is not a liberal America and a conservative America — there is the United States of America. There is not a Black America and a White America and Latino America and Asian America — there‘s the United States of America.”

–Barack Obama, July 27, 2004, speech before Democratic National Convention