The Great Auto Crash: The Inside Story

What caused GM and Chrysler to go bankrupt? Was it high oil prices? Was it bad management or car design? Or was it simply unfair foreign competition? If we listen to conventional wisdom, it points to all of these factors, including a rapidly changing technology that has digitised the auto industry world wide and created its own uncontrollable inertia. Are foreign cars really that much better than those made locally or is this a just a facet of history today? The Great Auto Crash takes a different approach to the crisis and argues that a series of inconsistent Government policies is central to the long term demise of the Big Three. It was the combined fight against inflation; shifting trade policies and the accommodation of foreign direct investment in the U.S. that can better explain where we are today under the guise of sustainability in both production and employment. To cap things off, the substitution of monetary and financial stimulus culminating with an aggressive program of deregulation in the financial industry came at the expense of traditional tax and spend policies. These changes are far more accountable for the obliteration of one of America’s most vital industries, than some of the traditional arguments driving the contemporary debate and consensus. This inconsistency and lack of co-ordination explains where we are today.