I thought this was interesting, so I'm going to turn this into its own post. Tell me what you think about this debate!
Thomas Kazmierczak
"Honestly, I don't think Detroit's (or Michigan's) auto industry can be saved. In the past, Michigan was able to stay dominant due to its pool of highly skilled auto workers. Unfortunately, with newer and more advanced automation processes, auto workers don't need to be skilled anymore. Thus, auto companies will shift their production centers to places with large supplies of cheap, unskilled labor, which Michigan does not have. IMO Michigan needs to transition as quickly as possible from jobs that do not require skilled labor (such as manufacturing) to jobs that do (biotech, geospatial tech, etc.) it will not be an easy one, but it is a necessary one.
Additionally, with regard to your "excessive" environmental policies, we have an example of what happens when modern industry is allowe to run unchecked. It's called China. Massive economic growth at the expense of ruining the soils, rivers, and lakes you depend on? I'll err on the side of protection, thanks."
The Wandering Wolverine
"I agree with you that Detroit's auto industry probably cannot be saved, at least in the sense that GMC and Ford are beyond repair. I disagree that the introduction of more advanced machinery would lead companies to seek out less-skilled workers; the current situation is that, perversely, American automakers are opening plants in cheap labor areas like Mexico, whereas Japanese and other foreign automakers are opening plants in Ohio, Alabama, et al. In other words, foreign automakers are seeking more skilled labor and domestic automakers are seeking cheaper labor.
This is an indication of the real situation, which is not that there are simply job losses being suffered in areas with highly skilled workers. It is that some auto companies are thriving and expanding production, whereas others are struggling, find themselves without the ability to cut losses (fired union workers get put in lucrative job banks funded by the companies, plus there are exorbitant pension funds to deal with), and have to risk expansion through cheap labor alternatives in a desperate bid to stave off bankruptcy. Union control and the excessively lucrative contracts guaranteed to auto workers are now taking an inexorable toll. That must be stopped.
Finally, the demise of the American car manufacturers will be significantly hastened by proposed controls on CO2, something that does not create smog or health problems, but is in fact plant food. These controls on CO2 will hardly make a dent in atmospheric CO2 levels, even according to global warming die-hards' models, but it's more a religious issue now than anything else. Since the Detroit manufacturers have found their niche in the market for low fuel efficiency, high safety and stability SUVs, this is a de facto subsidy to Toyota and Honda (and actually a real subsidy, since the Prius only exists because of special tax incentives) and a knife in the back to American industries.
As far as China is concerned, instead of being an example of lack of government control leading to excessive pollution, their situation is in fact illustrative of the normal story of industrialization. At the beginning, pollution is awful as factories and plants are inefficient and technologically primitive. As efficiency is increased, pollution is cut down (since pollution represents output loss from waste); so we saw in America, as smog levels began to clear up significantly after 1900, long before any environmental controls. Pollutant levels in the air and water also began to decrease somewhat before the beginning of environmental legislation--that's not to say that pollution controls did not encourage the process, but it is to say that free markets take care of pollution on their own quite nicely. In fact, the United States is currently cutting down their rates of increase of CO2 production far faster than more government controlled systems like those in Europe."
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