The Babbling Brooks of the NYT Babbles about Government-Induced Quagmires. GM will fail.

Abstract: David Brooks wanders into his own quagmire as he analyzes the General Motors mess and concludes that government intervention will only make the swamp a bit more dank and sticky. Thus, in a rare instance, he wanders out of his comfort zone with the correct conclusions about the future of this government debacle. Such deviations from liberal ideology that cast a brown light on government programs of any genera are atypical episodes from the NYT, so it was necessary to explore and execute an excursion into the reasoning of this proposition in detail. Although Brooks mechanically services some stale leftist platitudes, he stumbles onto the most likely concluding scenario that GM will be a permanent stain on capitalism and the taxpayers. It will fail as a company but excel as a political vehicle for ignorance, corruption and politics. It will become a gangrenous mass that will consume taxpayer’s monies without substance or effect for decades to come.

As we peruse the NYT—aka the Walter Duranty Papers[1][2]--an oddity of filtered  information and a rusty turn-of-the-crank Marxian siren,  we must always be prepared to suffer the harangues of exotic and persuasive grand visions about hope along with some new progressive leftist government that will bring glory and peace in our time. The NYT always has the proper social or economic solution to all known problems of society and will condemn all who would disagree with their findings. But, in a strange foray into the uncharted wilderness of reason and analysis, and probably by an unintentional collision with reality, our Chief Babbler David Brooks,[3] [4] seems to spread a sickly pallor over the bubbly froth and foam in dialectical opposition to what the Old Gray Lady normally touts. GM is not going to work out! This is a heresy so this article may be worth reading and pondering.

We begin with a boring set of quotes cherry-picked for the occasion and subject to the usual revisionist interpretations of the picker:

“On Jan. 21, 1988, a General Motors executive named Elmer Johnson wrote a brave and prophetic memo. Its main point was contained in this sentence: “We have vastly underestimated how deeply ingrained are the organizational and cultural rigidities that hamper our ability to execute.””The Quagmire Ahead by David Brooks Op-Ed Columnist Published: June 1, 2009 [Emphasis is mine in all quotes.][All quotes are from this link in this essay today unless otherwise indicated.]

 Yadda  Yadda Yadda

Of course the Old Gray Lady, or what is left of her carcass, would never be accused of having any political or “cultural rigidities” that might interfere with its propaganda machine. They are objective and all who disagree with their ethereal mandates are Neanderthals, bigots, Nazis or worse.

Not to bore the readers with a rummaging exercise through the tombs of lost enterprise, we can just summarize Brooks’ conclusion at this point with this summation:

“Over the last five decades, this company has progressively lost touch with car buyers, especially the educated car buyers who flock to European and Japanese brands. Over five decades, this company has tolerated labor practices that seem insane to outsiders. Over these decades, it has tolerated bureaucratic structures that repel top talent. It has evaded the relentless quality focus that has helped companies like Toyota prosper.”-- David Brooks

Missing here are: the government’s coddling of union labor at G.M., the mangling of the design process caused by the psychotic C.A.F.E. standards, EcoNazism and other liberal adventures.  Also omitted are the brands that are highly profitable [5] such as the Chevy Silverado and the Cadillac Escalade. People don’t want to buy tiny electric death traps to zip around in. They are phony anyway as we don’t have the battery technology to make them drive decent distances.[6] This warped vision of creeping failure is directed toward management as if they operated in an otherwise free market system where oppressive government was absent or at least benign.

“As a result, G.M. has steadily lost U.S. market share, from 54 to 19 percent.”-- David Brooks

Okay, a given.  Now for the quick fix with government rushing in on their donkeys fixed up with honking kazoos and little hop and clap dances and fresh blueprints for the ultimate green weenie urban micro EcoBuggy that gets a thousand miles per gallon or runs only on gratuitous political wind:

“For the elemental facts about the Obama restructuring plan are these: Bureaucratically, the plan is smart. Financially, it is tough-minded[??? ed]. But when it comes to the corporate culture that is at the core of G.M.’s woes, the Obama approach is strangely oblivious. The Obama plan won’t revolutionize G.M.’s corporate culture. It could make things worse.”-- David Brooks

The nostrum that we have, perhaps for the first time, a “bureaucratically smart government” plan is astonishing as it stands alone in history. One of the words in that quote is out of place in this sentence. When did the government ever have a successful program? How about we inquire about welfare, Social Security, Medicare, Great Society, War on Poverty, HUD, HHS, Mexican Border, drug control, spending, debt or some others that might be randomly selected. These cited programs were expensive and bureaucratic swamps—not anywhere near smart. Our worthless government cannot make government function according to promised or proffered plan or plea. They are losers. History is clear on this point.

Then, the notion that G.M.’s culture will not change is absurd as G.M.’s culture will metamorphose into the lap dog and candy comedy of the government’s slightest craving. Every stooge appointed to monitor the suburban toilet flush volumes will have some ‘input’ into design and structure of this pile of emotional and social pulp.

Brooks rolls in a lot of debris into his analysis but here is the essence of his part I of a VI part analysis:

[1] “But the Obama plan rides roughshod over the current private investors and so discourages future investors.”-- David Brooks

I think he is slithering by the Constitutional prohibition of government operating normal corporations as they “didn’t” do with G.A.F.[7], Amtrak and the phony US Postal Service, all wrecks. He omits, as if he is living in some cloak-and-dagger scene from some rewind of an A.  Conan Doyle saga, the shabby and illogical treatment of secured debt bond holders and the colossal body of bankruptcy law that should have given then a first place in the operating room when the smelly carcass of GM is carved up and tossed to the howling dogs. One successful element of propaganda creation is the omission of essential factors thus creating disinformation[8]  by omission and thus the illusion of fact. Brooks is following right left along here on budget and on plan.

That is the last damn time people that can boast a brain case with more than 6 neurons to rub together will buy bonds from some company that might be a government takeover target. Go get it from the ChiComs or just go out into the woods and whistle for your funding. Stuff it Washington!

Brooks now mixes labor and management and blends them into some kind of cake mix that could be baked to make brownies or muffins at will:

[2] “Second, the Obama plan entrenches the ancien régime. The old C.E.O. is gone, but he’s been replaced by a veteran insider and similar executive coterie. Meanwhile, the U.A.W. has been given a bigger leadership role. This is the union that fought for job banks, where employees get paid for doing nothing. This is the organization that championed retirement with full benefits at around age 50. This is not an organization that represents fundamental cultural change.”-- David Brooks

This is a hopeless snarl of the components of a corporation and is typical of the NYT far leftist culture. To think that the corrupt and greedy unions have existed in some kind of leadership role is the kind of undomesticated fiction that needs to be sprinkled with pixie dust to gain some respectability.  Union featherbedding was obliquely mentioned here, but the work rules and Wagner Act bargaining laws have forced GM to allow unions to gut this business, or, at least the inefficient and unprofitable part—the American unionized auto manufacturers. The idea that labor will co rule with exempt management is a sick joke. The unions cannot hold massive quantities of common shares and simultaneously sit on the board and sanely discuss labor costs, profits and work rules in the same session. The Japanese, Koreans, Germans and others seem to be doing fine without labor haunting their boardrooms. They are the ones who took the lion’s share of business away from the union-besotted GM wreckage that used to be a car company. Thus, they handily bested the ancien régime. Here is an idea: why not crapcan G.M. and let the marginal business go to the non union car companies? They could then make their better cars at a profit sans unions and government. Everybody wins!

Brooks is mistaken—the régime will be some mirror of government bureaucracy.

[3] “It would be politically suicidal for the Democrats, or whoever is in power, to pull the plug on the company — now or ever. Therefore, the current managers can rest assured that they never need to fear liquidation again. There will always be federal subsidies for their own mediocrity.”-- David Brooks

Doesn’t this comment derive from history, as long as we are playing that little game, and doesn’t this smell like Amtrak? [Note: created in 1971 “…officials expected that Amtrak would break even by 1974…[9]… lost money every year.”], The New York Central and Penn Central railroads wound up as the tombs for the rotting rail business and they, too, were ‘too big to fail’ and union jobs were at stake and all that. Amtrak has never made a profit and apparently never will but this shameful excuse for a transportation service has nothing to fear when the question of federal subsidies arises. They are wired into the tax base like cockroaches in the Bronx. They are a permanent fixture on the political landscape.

 [4] “Fourth, the Obama plan dilutes the company’s focus. Instead of thinking obsessively about profitability and quality, G.M. will also have to meet the administration’s environmental goals.”

Well, David bangs this one on the noggin. And, notice, this is not a ‘business’—this is some kind of political mission thus doomed to failure. Anybody reminded of Moscow Central Planning here? This company will be destroyed by EcoNazi Feature Creep. Every quack idea from windmills on the roofs to cold fusion propulsion will be bolted on every model.

[5] “Fifth, G.M.’s executives and unions now have an incentive to see Washington as a prime revenue center. Already, the union has successfully lobbied to move production centers back from overseas. Already, the company has successfully sought to restrict the import of cars that might compete with G.M. brands. In the years ahead, G.M.’s management will have a strong incentive to spend time in Washington, urging the company’s owner, the federal government, to issue laws to help it against Ford and Honda.”

Brooks refrains from using the term ‘sugar daddy’ here as he probably should. They will just  be common whores. This ‘arrangement,’ a ménage à trois, collects expertise from well-established business operators such as street hookers, loan sharks and soup kitchens cooks and rolls them into one sticky mass that will adhere to any political wall or appropriations bill. The union factions will bawl for higher and higher tariffs on foreign-made autos and will find ways to tax the domestic competition or get special subsidies to undermine competition by real car companies. The slogan “Buy Detroit or we will raise your taxes” will dominate the adverting medium.

[6] A restroke of [5]: “Sixth, the new plan will create an ever-thickening set of relationships between G.M.’s new owners — in government, management and unions.”

[Fini] “The end result is that G.M. will not become more like successful car companies. It will become less like them. The federal merger will not accelerate the company’s viability. It will impede it. We’ve seen this before, albeit in different context: An overconfident government throws itself into a dysfunctional culture it doesn’t really understand. The result is quagmire. The costs escalate. There is no exit strategy.”[10]

This conclusion is remarkable and probably highly predictive of what GM will look like when liberal Democrats get into the washrooms, hospitality suites and plumbing of this company.  This little story is not exactly what the NYT expects as a proper leftist analysis of the rotting carcass of GM. It has some negative elements here that denigrate government. Brooks has strayed from the limits of his nose ring chain in the past and somehow his job remains apparently secure.  He does a good job here.

After paring away some of the hokum and blow from this piece, the conclusion is well argued.  G.M. will become a wanton tax whore that will suck money from the taxpayers like a waterspout in a typhoon. It will be come a colossal failure like Amtrak or Social Security and will be converted into a juicy political plum for the friends and offspring of leftist supporting types and their political bedfellows. It will be a candy store for the sick, lame and lazy and will be celebrated as a masterpiece in governance around socialist campfires.

 This is why we can never again buy a car from Detroit.

 rycK

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