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Here we go. Mike asks why GM failed:

It refused to build automobiles that the public wanted, cars that got great gas mileage, were as safe as they could be, and were exceedingly comfortable to drive. Oh—and that wouldn’t start falling apart after two years.

Ignore for the moment, that “great gas mileage” and “as safe as they could be” may be competing, not complementary goals (the safety of SUVs is highly questionable, but the lack of safety of small light cars is not).  The problem with this statement is that GM was was building the cars Americans wanted—big inefficient gas-guzzling SUVs.  Fuel-efficient cars, until last year’s oil spike, sat unwanted on lots.  And even now, sales have dropped and the so-called “smart cars” are not selling.

This is a pity because Americans should want fuel efficient cars.  I just sold my 1995 Saturn and it was lovely car—safe, fuel efficient and cheap.  The price of oil is not going to stay low and so my next car will inevitably be something along the same lines.

But the fact is that most Americans do not want those kinds of cars.  And they certainly don’t want the little tin econoboxes that our government is about to force onto us.

And it was hell-bent on punishing its unionized workforce, lopping off thousands of workers for no good reason other than to “improve” the short-term bottom line of the corporation.

Pure lies.  As Michael is well aware, the Big Three had an extremely cozy relationship with the unions for decades.  The biggest reason they are crumbling now is because, during those years, they foolishly made tens of billions of dollars in future commitments to the unions.  Workers got high salaries, generous benefits and could retire relatively young with a pension equal to their working pay.  They even get paid when the factories are idle.

This was sustainable for a long time because Detroit was effectively a monopoly.  The Big Three did not compete on labor costs (or reliability) because they had a captive market in the American public.  They could charge high prices for cars because there was no competition.  When foreign companies breached the American market with cheaper more reliable cars, that system collapsed.  By the 1990’s, the Big Three were using cars a loss leader to sell financing.

Moore notes that GM laughed at “inferior” Japanese and German cars.  The reason those cars are successful, Michael, is because the unions have had far less influence.  Their pension and healthcare commitments are far smaller, which is why their effective cost per hour of making a car is so much smaller.

Beginning in the 1980s, when GM was posting record profits, it moved countless jobs to Mexico and elsewhere, thus destroying the lives of tens of thousands of hard-working Americans. The glaring stupidity of this policy was that, when they eliminated the income of so many middle class families, who did they think was going to be able to afford to buy their cars?

More economic ignorance.  Cheaper manufacturing means cheaper cars (and therefore, an ability to compete with Japan and Germany).  It also means that while the auto-workers are hurt, other industries boom because of cheaper transportation—industries that can then hire the displaced auto workers.

In addition, Michael completely ignores insourcing.  Many of the plants GM opened overseas were to manufacture cars for sale in those countries —a sound practice, but one actively enouraged by nitwit protectionism and foolish tax laws.  Moreover, just as we have opened factories in other countries, the system of capitalism has allowed companies like Nissan and Toyota to open factories in this country.  But without the legacy of old union contracts, those factories turn a profit.

So here we are at the deathbed of General Motors. The company’s body not yet cold, and I find myself filled with—dare I say it—joy. It is not the joy of revenge against a corporation that ruined my hometown and brought misery, divorce, alcoholism, homelessness, physical and mental debilitation, and drug addiction to the people I grew up with. Nor do I, obviously, claim any joy in knowing that 21,000 more GM workers will be told that they, too, are without a job.

Actually, considering how much Michael loves to wallow in other people’s suffering, I think he does feel some joy about these things.  He’s made a career exploiting tragedy, from laid-off workers to gunshot victims to the uninsured.  And he sure as hell enjoys blaming those tragedies on his political opponents.

Saving our precious industrial infrastructure, though, is another matter and must be a top priority. If we allow the shutting down and tearing down of our auto plants, we will sorely wish we still had them when we realize that those factories could have built the alternative energy systems we now desperately need. And when we realize that the best way to transport ourselves is on light rail and bullet trains and cleaner buses, how will we do this if we’ve allowed our industrial capacity and its skilled workforce to disappear?

It’s not that simple to bend sword into plowshares (or cars into trains).  You’re talking about an enormous investment of infrastructure in an area of the country that is hemorrhaging workers, capital and education.  Detroit may not be the ideal place to build those things, anyway, especially given the horrendous tax situation in Michigan.  Finally, many of the jobs for bullet trains and light rail need to be where these things would be built—on the coasts.

We can’t just pick communities and order industry to build there.  That’s a good way to hamstring an economy.

Twenty years ago when I made “Roger & Me,” I tried to warn people about what was ahead for General Motors. Had the power structure and the punditocracy listened, maybe much of this could have been avoided.

I have not seen Roger and Me.  But if Michael was warning us that overly generous union benefits would make cars a loss-leader for the Big Three, I will eat my copy of Do As I Say, Not As I Do.  It wasn’t outsourcing that killed GM; it was a change in the marketplace.  Their business model—a model based partially on hefty union benefits—became outdated and unsustainable.

Based on Michael’s “expertise”, he suggests what we need to do now.  His plan is as bold, as ignorant and as doomed to fail as any “Five Year Plan” that ever emerged from the Soviet Union.  Michael envisions the government completely reworking the economy, trampling thousands of laws and the liberties of millions of people—all to create his vision.  There are no caveats—no acknowledgement of uncertainty—no indication that this may not work.  Michael believes in this with a fervor that would make the most End of Days Christian blush.  He really thinks we can do all these things just be wishing for it be so.

1. Just as President Roosevelt did after the attack on Pearl Harbor, the President must tell the nation that we are at war and we must immediately convert our auto factories to factories that build mass transit vehicles and alternative energy devices. Within months in Flint in 1942, GM halted all car production and immediately used the assembly lines to build planes, tanks and machine guns. The conversion took no time at all. Everyone pitched in. The fascists were defeated.

We also had a shocking amount of debt and an economy that, while producing nominal growth, produced little improvement in American lives.  Moreover, we were at war for our very existence.  Wasting billions of dollars was not an issue because FDR understood that there is nothing more expensive than a second-rate military.  Everything was sacrificed for the war effort.  And even then, the effort was heavily dependent on Americans freely donating scrap, rubber, metal, even cooking grease and buying the hell out of bonds.  Our entire economy was turned over to war.  Our current situation is not even close.

And Michael take the wrong lesson from history.  It’s relatively easy to have a car factory churn out jeeps and tanks—the skills needed are very similar.  Alternative energy is a completely different industry—and requires very different skills from the workers.  The people that build cars may not have the skills to build solar panels.  In a free market economy, those jobs would be taken by people who do have those skills and the auto workers would find jobs that exploit the skills they have.  In economic circles, it’s called the Law of Comparative Advantage and it is the principle reason why capitalism works as well as it does.

This current war has two fronts. One is headquartered in Detroit. The products built in the factories of GM, Ford and Chrysler are some of the greatest weapons of mass destruction responsible for global warming and the melting of our polar icecaps. The things we call “cars” may have been fun to drive, but they are like a million daggers into the heart of Mother Nature. To continue to build them would only lead to the ruin of our species and much of the planet.

Apparently, we should go back to transporting food to the hungry people of the world by pack mule.

I will not stand for this slander.  The automobile is one of the greatest inventions in human history.  It has generated astonishing human wealth and progress by liberating people from the confines of geography.  It has made mobile the greatest resource we have—human beings—and therefore made us all rich by any historical standard.  It abolished the horse and the manure-spread epidemics that used to ravage cities.  Even if we accept global warming—and I do—cars are a small part of the overall picture.  What is it with Left and demonizing cars?

The other front in this war is being waged by the oil companies against you and me. They are committed to fleecing us whenever they can, and they have been reckless stewards of the finite amount of oil that is located under the surface of the earth. They know they are sucking it bone dry. And like the lumber tycoons of the early 20th century who didn’t give a damn about future generations as they tore down every forest they could get their hands on, these oil barons are not telling the public what they know to be true—that there are only a few more decades of useable oil on this planet. And as the end days of oil approach us, get ready for some very desperate people willing to kill and be killed just to get their hands on a gallon can of gasoline.

It’s worth pointing out here that the vast majority of the world’s oil companies are state-owned and state-run.  To the extent that have despoiled the Earth, it has been largely a political hand at the till.

Moreover, the evil oil companies have never held a gun to our head and forced us to drive.  All they did was make cheap energy readily available, to the benefit of billions who have used that energy to get clean food and clean water; to educate themselves; and to lift themselves out of poverty.  The engine of human progress has been driven by fossil fuels and I have no problem with people making money off of that.  That’s not even to mention that petroleum products, like plastic, that have made our lives infinitely better and safer.

Fossil fuels may have outlived their ecological welcome.  But their exploitation made the 20th century the best in human history, despite the predations of the powerful governments Mikey loves so much.  It made people rich enough that war became too much of a hassle; healthy enough that most of us will die of old age; educated enough to understand the world we live in; and fed enough that obesity is our biggest health concern.

I don’t like all the practices of the oil companies myself.  I have no illusions about the dark side of capitalism.  But the oil companies’ greed and their chicanery has, as Adam Smith predicted, inadvertantly benefited us all.

And to hear “didn’t give a damn about future generations” from a man who is advocating a massive expansion of debt and the crippling of healthcare innovation through socialized medicine is offensive.

2. Don’t put another $30 billion into the coffers of GM to build cars. Instead, use that money to keep the current workforce—and most of those who have been laid off—employed so that they can build the new modes of 21st century transportation. Let them start the conversion work now.

I agree that we shouldn’t give any more money to GM.  But this is a repeat of point 1.  Moreover, what Michael is talking about will cost many many times what we’re proposing to give GM.

3. Announce that we will have bullet trains criss-crossing this country in the next five years.

This is hilarious.  Five years would not even be enough time to get the land-use permits, least of all build a massive train system.  The last major work we had in this vein was the interstate system.  As you may have noticed, it’s still being built.  Creating a rail system that fast—over multiple states, through many districts, over private and public land—some of which has been set aside as nature preserves—would only be possible in a dictatorship.  That’s the only way to bulldoze the thousands of competing and legitimate interests along with the forests and wetlands the rail would need to go through.

And it’s not cheap.  The cost, if you extrapolate California’s projections for the Vegas line, would be north of $500 billion just for the modest proposals we have right now.  For that price, we could practically buy ever American an electric car.

High speed rail always sounds good but it is the perpetual pipe dream.  Every proposal (and Obama’s is just a recycled version of Bush’s) comes to nothing.  Even the current proposals aren’t high speed, as such.  They meander through various congressional districts and can therefore not maintain a high speed.

They’re not even clean:

According to the Department of Energy, the average Amtrak train uses about 2,700 British thermal units (BTUs) of energy per passenger mile. This is a little better than cars (about 3,400 BTUs per passenger mile) or airplanes (about 3,300 BTUs per passenger mile). But auto and airline fuel efficiencies are improving by 2 percent to 3 percent per year (for example, a Toyota Prius uses less than 1,700 BTUs per passenger mile).

By contrast, Amtrak’s fuel efficiency has increased by just one-tenth of 1 percent per year in the past 10 years.

This means, over the lifetime of an investment in moderate-speed trains, the trains won’t save any energy at all. In fact, to achieve higher speeds, moderate-speed trains will require even more energy than conventional trains and probably much more than the average car or airplane 10 or 20 years from now.

Michael compares us to Japan (liberals always love anything from Japan). This is incredibly stupid.  Japan has ten times our population density.  Japan does not have massive stretches of unoccupied land.  High speed rail works—in a limited context—in Japan.  Even then, 80% of their rail service is traditional rail.  And Tokyo is not exactly known for its light traffic.

High-speed rail, if it actually came to pass, might work in some of the more high-density areas of the US, like the coasts.  But as a national solution to move three hundred million people and unthinkable tons of freight, it’s bollocks.

4. Initiate a program to put light rail mass transit lines in all our large and medium-sized cities. Build those trains in the GM factories. And hire local people everywhere to install and run this system.

Jobs jobs jobs.  Who cares if it works? It’s all just a jobs program.

Light rail has proven to be an economic disaster with little to no benefit to the environment.  Cities that can benefit from rail—like New York—have already built it.  In most American cities, people prefer to drive.  So you’re spending energy building and running a light rail system that carries very few passengers.  In order to make it work, you are going to have to force people to ride it.

5. For people in rural areas not served by the train lines, have the GM plants produce energy efficient clean buses.

A gigantic waste of money. And with little ecological benefit.  I live in a small town that has a very good bus system.  I still have to drive a lot.  The only reason it works at all is because this a college town and many students do not have or need cars.  This would not be the case in most cities. And it does not benefit the environment to have empty buses rattling down the roads.

6. For the time being, have some factories build hybrid or all-electric cars (and batteries). It will take a few years for people to get used to the new ways to transport ourselves, so if we’re going to have automobiles, let’s have kinder, gentler ones. We can be building these next month (do not believe anyone who tells you it will take years to retool the factories—that simply isn’t true).

As I noted above, we can’t even sell the electric and hybrid cars we already have.  Are you going to force people to buy these cars?  Are you going to impose trade restriction to keep Japan, Korea, China, Germany, Italy, France and the UK from selling us the cars we actually want?  Where is this massive increase in the power output of our electrical grid going to come from?  Even if we start a crash course of building alternative energy, it will be decades before it comes on line.

7. Transform some of the empty GM factories to facilities that build windmills, solar panels and other means of alternate forms of energy. We need tens of millions of solar panels right now. And there is an eager and skilled workforce who can build them.

Where are you going to put the solar panels and windmills, Michael?  In deserts?  On mountains? The environmentalists are opposed to that.  Moreover, neither solar nor wind is mature enough to take over our energy structure.  We have no way to efficiently get that power to the cities or to store it for use on cloudy windless days.

There are huge advances yet to be made in energy transfer and storage before solar and wind power are even remotely viable.  Simply waving your hands does not make the huge technological hurdles disappear.

And again, it takes years to get things built.  Even if we shoot all the environmentalists so that we can build in isolated areas, we will need years just to build the transmission lines.  What are we going to do with those solar panels in the meantime?  Stack them up in warehouses?

8. Provide tax incentives for those who travel by hybrid car or bus or train. Also, credits for those who convert their home to alternative energy.

Uh, Mike?  I realize you probably don’t fill out your own taxes.  But we’re already doing that.

9. To help pay for this, impose a two-dollar tax on every gallon of gasoline. This will get people to switch to more energy saving cars or to use the new rail lines and rail cars the former autoworkers have built for them.

Finally, we get to the way Michael intends to coerce people into buying shitty cars, riding on energy-guzzling trains and moving to cities serviced by trains.  He’s going to tax the hell out of them.  Never mind the crippling effect this will have on poor people who can not afford the new cars or do not live where these fancy rail lines are going to run.

Remember this, as well:  high-speed rail will mostly service the coasts, not in the midwest.  So people in New York will get cheap rail payed for by the gas bills of people in the heartland.  That’s a great way to save Flint.

Here’s his conclusion:

It’s a new day and a new century. The President—and the UAW—must seize this moment and create a big batch of lemonade from this very sour and sad lemon.

They can.  By not trying to run an economy based on politics and wishcasting.

60% of GM is ours. I think we can do a better job.

Just Like we did with Amtrack.  Or the Synthetic Fuels Corporation.  Or ethanol.  Or the post office.  Or the VA hospitals.  Or Medicaid.  Or…

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