- The Washington Times - Wednesday, November 19, 2008


The only thing that will cure the current mortgage/credit crisis is for enough home buyers to reduce the bloated inventory of homes. Similarly, the only thing that will cure the U.S. automakers’ problems is an abundance of car buyers.

The federal government spent three-quarters of a century pursuing policies that artificially increased the price of housing, culminating in a credit bubble. Similarly, you can see a long list of U.S. automaker costs that basically did in the automakers - 7,000 dealerships (Toyota Motor Corp. has 1,000), too many models, too many plants, bloated union contracts, etc.

So what is going to induce me to buy a U.S.-manufactured car?

The sordid family history is that we always owned Chevys, and I had the misfortune of owning a Corvair, followed by a Vega. The Corvair actually was the best of the lot, Ralph Nader notwithstanding. You might say my family did its time with the Big Three and worked on the line to produce the cars during Detroit’s declining heyday.

Most pundits maintain that nobody is going to buy a U.S.-manufactured car if the companies are in bankruptcy. Boy, do I have news for the pundits: Nobody is even going to look at a U.S.-manufactured car unless the companies go into bankruptcy, reduce their dealerships by 80 percent, eliminate at least half of their models and dump the union contracts in the garbage can.

If they did all of this, I at least would entertain the idea that they had a chance of competing with Toyota and Honda Motor Co. Ltd., and I would consider their product lines. At this point, the public is aware of the mess Detroit is in, and another $25 billion is not going to keep the public out of the Toyota and Honda showrooms any more than it will keep the remaining U.S. autoworkers from buying cheap, foreign-made flat-screen TVs from Wal-Mart.





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