Tuesday, June 2, 2009

The General Gets Demoted

General Motors, or as some people are calling to nowadays...Government Motors has declared bankruptcy. My new favorite nickname is Major Motors, as the company is literally being demoted. I do not mean for this post to talk about the politics involved in GM declaring bankruptcy, but more the human toll on my home state and the entire country.

Few people completely understand how BIG of a deal this is, literally. The General is so large, so much a part of every part of the economy, that it's bankruptcy is going to have ramifications far beyond it's headquarters here in Detroit. Just in the bankruptcy filing alone GM has detailed 20,000 jobs being cut, and is cutting 2000 dealerships, resulting in about 100,000 job losses there. Lets try to put that in perspective. Cities with equivalent populations include: Ann Arbor, MI, Albuquerque, NM, Stamford, CN and Abilene, TX. It is as if someone came into one of those towns and told everyone that they would no longer have a job. More fun statistics -- 43% of GM's factory jobs in Michigan are being eliminated, 650,000 retirees have no idea what the future will hold for their pensions, the city of Pontiac will lose 20% of its General Fund when Pontiac Assembly closes.

All of this, of course, has very human ramifications; it is not just numbers on a page. A local radio show put together a great example of how these decisions are affecting everyday people by creating a 100ft banner using pictures of people affected by the auto industry. Check out some pictures here as they took it to Washington, DC. So for the time being, the result will be: more unemployment, more crime, more abandoned industrial infrastructure, less American's making things American's buy. I think we will look back on this day in either one of two ways. First, we could look back at this as the jump start the Detroit region, and the country needed to head in a different direction, creating an industrial policy that reclaims America's manufacturing supremacy. This path leads to more jobs, more technical innovation, and of course to a greener transportation system. Secondly, we could look back and say this is the day American manufacturing died. We will make and innovate here no more. We will rely on foreign concerns to engineer and develop what we drive, and if we are lucky enough, they will let us put the cars together when the exchange rate is right.

I personally pray for the first path, and I especially pray for the families of all who are affected by this bankruptcy. This will not be an easy road, but we are a resilient people. Time to volunteer at a local soup kitchen, give a little more to the food bank, and above all, give a helping hand to your neighbor, because chances are someone you know is going to be affected by this.


Rosiecat said...

Poor Mitten State...

I think you're right that those of us who don't live in Michigan have but the faintest clue of what GM's decisions mean to hundreds of thousands of people. I SHOULD know these things, but I don't! (That's why I rely on you, JD, to update me on the happenings in MI. You and my parents.)

It's devastating, but I see revolutions happening in other realms: people are buying locally grown food and people are spending money to green up their homes, just to give two examples. I think the turmoil in the auto industry and manufacturing in general could inspire a similar revolution, but it won't happen overnight. So keep spreading the word, JD, and keep the faith.

JD said...

I think it is easy to approach this from two perspectives. If you are around Detroit, it is easy to get too caught up in it, because for our region, this is truly devastating. Nationally. I think people are not concerned enough. Hopefully it will all work out best and we can move forward as a country.