March 27, 2009 at 12:37 pm

Daniel Howes

Commentary: Sacrifice? It's in this state's DNA

Did you really doubt the president of the United States would agree to "provide some help," as he put it Thursday, for Detroit's struggling automakers?

Me, neither, considering the signals sent by members of his auto task force the past week. Then add the soaring unemployment rate -- a nation-leading 12-percent here in moribund Michigan -- and the potential blows that rolling bankruptcies could land on a shaky economy, consumer confidence and, especially, the United Auto Workers.

The union born of the '30s-era Sit-Down Strikes and Battle of the Overpass has a lot at stake -- arguably its viability -- in a crisis imperiling fundamental promises to members and retirees. Yet, the union and its canny president, Ron Gettelfinger, are emerging as the best friends the automakers have right now in a national debate where friends are rare and the collective grasp of the "sacrifices" already made rarer still.

"Gettelfinger has enormous sway in Washington," a ranking industry executive tells me. "His voice is more influential than any of the" automakers. "They're going to get another tranche of money in April."

That much is now certain, even if the exact amount isn't. Also certain by now is that federal largesse in Bailout Nation, be it "bridge loans" or direct cash infusions or loan guarantees, entitles the feds to dictate business decisions. Just ask the AIG executives forced to relinquish bonuses for doing the work to clean up messes left by their predecessors.

Telling, isn't it, that the day after Obama confirms his intent to help Detroit -- with strings -- his Environmental Protection Agency confirms tough new fuel economy rules that will cost the automakers yet more billions to meet. Fine, because it's a result of the '07 energy bill.

But the other strings?

More rope to extend the federal lifeline -- now at $17.4 billion for General Motors Corp. and Chrysler LLC, and $5 billion for auto suppliers -- will come with conditions, the president says. He wants more sacrifice from unions and executives, bondholders and suppliers.

Sacrifice? What, exactly, has this town and its investors been experiencing the past three-plus years? Spring break? This notion, aired during the congressional inquisitions late last year, picked up by Team Obama and wielded by whoever's trying to score points, that Detroit Auto hasn't yet "sacrificed" in a (losing?) effort to fix itself is absurd.

The union has helped usher many thousands into retirement, bargained down its wage and benefit scale for new hires and agreed to sharp reductions in company health-care obligations. Brands have been sold, dealers lost, bonuses eliminated, salaries cut, tens of thousands of jobs eliminated in wave after wave after wave of reductions.

Plants are going or gone in communities across the country. Local and state tax revenue started plunging long before home values in Manhattan and the Bay Area did. Michigan's per-capita income, long among the nation's highest, has been dropping like a stone this decade and soon will be lower than Republican Sen. Richard Shelby's Alabama.

Sacrifice? We've seen a few, even if it doesn't look to be "enough" from the condescending heights of New York, Washington and San Francisco. And you know what? It isn't enough, not now anyway, not when technically insolvent companies are petitioning the Treasury Department for aid because their credit ratings are destroyed and car and truck sales are trending at terrifyingly low levels.

I, too, have argued Detroit's business model is hopelessly broken, that its costs were indefensibly high, its brand image tarnished, its culture mired in denial, its management and union leadership too often willing to accept short-term expedience at the expense of long-term success.

But sneering about sacrifice, as if there's been none, is a towering insult to the tens of thousands of families, white-collar and blue-collar, who took buyouts and walked out into a collapsing economy; to the dealers whose businesses have collapsed; to the 7,631 UAW members -- 53 percent of them in Michigan -- who this week accepted comparatively meager packages to walk away from GM.

Sacrifice? If there are two things this state and its bellwether industry understand, it's sacrifice and recession -- and the knowledge that there's more of both to come.

Daniel Howes' column runs Tuesdays, Thursdays and Fridays. He can be reached at (313) 222-2106, dchowes@detnews.com">dchowes@detnews.com or detnews.com/howes. Catch him Fridays with Paul W. Smith on 760-WJR.

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