Remember Lee Iacocca, the man who rescued Chrysler Corporation from
its death throes? He's now 82 years old and has a new book, 'Where Have
All The Leaders Gone?'.
Lee Iacocca Says: 'Am I the only guy in this country who's fed up with what's happening?
Where the hell is our outrage? We should be screaming bloody murder! We've
got a gang of clueless bozos steering our ship of state right over a cliff,
we've got corporate gangsters stealing us blind, and we can't even clean up
after a hurricane much less build a hybrid car. But instead of getting mad,
everyone sits around and nods their heads when the politicians say, 'Stay
the course.'
Stay the course? You've got to be kidding. This is America, not the
damned, 'Titanic'. I'll give you a sound bite: 'Throw all the bums out!'
You might think I'm getting senile, that I've gone off my rocker, and
maybe I have. But someone has to speak up. I hardly recognize this country
anymore.
The most famous business leaders are not the innovators but the guys
in handcuffs. While we're fiddling in Iraq , the Middle East is burning
and nobody seems to know what to do. And the press is waving 'pom-poms'
instead of asking hard questions. That's not the promise of the 'America'
my parents and yours traveled across the ocean for. I've had enough. How
about you?
I'll go a step further. You can't call yourself a patriot if you're
not outraged. This is a fight I'm ready and willing to have. The Biggest
C' is Crisis! (Iacocca elaborates on nine C's of leadership, with crisis
being the first.)
Leaders are made, not born. Leadership is forged in times of crisis.
It's easy to sit there with your feet up on the desk and talk theory. Or
send someone else's kids off to war when you've never seen a battlefield
yourself. It's another thing to lead when your world comes tumbling down.
On September 11, 2001, we needed a strong leader more than any other
time in our history. We needed a steady hand to guide us out of the ashes.
A hell of a mess, so here's where we stand.
We're immersed in a bloody war with no plan for winning and no plan
for leaving.
We're running the biggest deficit in the history of the country.
We're losing the manufacturing edge to Asia, while our once-great
companies are getting slaughtered by health care costs.
Gas prices are skyrocketing, and nobody in power has a coherent energy
policy. Our schools are in trouble.
Our borders are like sieves.
The middle class is being squeezed every which way.
These are times that cry out for leadership.
But when you look around, you've got to ask: 'Where have all the
leaders gone?' Where are the curious, creative communicators? Where are the
people of character, courage, conviction, omnipotence, and common sense? I
may be a sucker for alliteration, but I think you get the point.
Name me a leader who has a better idea for homeland security than
making us take off our shoes in airports and throw away our shampoo?
We've spent billions of dollars building a huge new bureaucracy, and
all we know how to do is react to things that have already happened.
Name me one leader who emerged from the crisis of Hurricane Katrina.
Congress has yet to spend a single day evaluating the response to the
hurricane or demanding accountability for the decisions that were made in
the crucial hours after the storm.
Everyone's hunkering down, fingers crossed, hoping it doesn't happen
again. Now, that's just crazy. Storms happen. Deal with it. Make a plan.
Figure out what you're going to do the next time.
Name me an industry leader who is thinking creatively about how we can
restore our competitive edge in manufacturing. Who would have believed that there could ever be a time when 'The Big Three' referred to Japanese car
companies? How did this happen, and more important, what are we going to do
about it?
Name me a government leader who can articulate a plan for paying down
the debit, or solving the energy crisis, or managing the health care
problem. The silence is deafening. But these are the crises that are eating
away at our country and milking the middle class dry.
I have news for the gang in Congress. We didn't elect you to sit on
your asses and do nothing and remain silent while our democracy is being
hijacked and our greatness is being replaced with mediocrity. What is
everybody so afraid of? That some bonehead on Fox News will call them a
name? Give me a break. Why don't you guys show some spine for a change?
Had Enough? Hey, I'm not trying to be the voice of gloom and doom
here. I'm trying to light a fire. I'm speaking out because I have hope - I
believe in America. In my lifetime, I've had the privilege of living through some of America 's greatest moments. I've also experienced some of
our worst crises: The 'Great Depression,' 'World War II,' the 'Korean
War,' the 'Kennedy Assassination,' the 'Vietnam War,' the 1970's oil
crisis, and the struggles of recent years culminating with 9/11.
If I've learned one thing, it's this: 'You don't get anywhere by
standing on the sidelines waiting for somebody else to take action. Whether
it's building a better car or building a better future for our children, we
all have a role to play. That's the challenge I'm raising in this book.
It's a "Call to Action" for people who, like me, believe in America'. It's
not too late, but it's getting pretty close. So let's shake off the crap
and go to work. Let's tell 'em all we've had 'enough.'

While flipping channels the other night I happened upon 20/20 and John Stossel opining on the auto sector and their request for a bailout. If you are interested in his comments you can pick them up on this website http://abcnews.go.com/2020/Stossel/Story?id=6343705&page=2

His points as well as the facts I have raised in earlier blogs seem to be no brainers….common sense but the politicians (surprise) don’t see it that way. People seem to forget that 2/3 of the so-called foreign automobiles sold in the USA are manufactured there. In fact amidst all of this doom and gloom both Honda and Kia are just opening new plants this month in the southern USA. The average wage is $18.00 hr vs the big three at $29.00 hr. I’m not sure what the benefits are but I can guarantee you they are nowhere near the UAW employee’s package. While agreeing to these expensive wages and benefits over the past decades the Big 3 Management had to find a way to get their costs in line to compete so one of the things they had to do was to opt for cheaper materials and guess what that meant. Another thing I saw that amazed me was the so-called job banks negotiated by the UAW. A plant that closes down has to guarantee the employees 4 years work. So they showed a closed down plant where everyone came to the factory everyday and just sat there and did nothing for 8 hours and collected full wages. This is ludicrous at any time but certainly at a time when the Companies are going bankrupt this practice should cease immediately. As I’ve said before I don’t blame the unions for negotiating these deals because Management, who has the decision making power, signed off on these rich benefits. But the time has come after everybody including both the union and the management, who have successfully run the Companies into the ground must regroup and get back to some semblance of reality if they want to survive. Contracts have to be reopened, plants and dealerships closed within a massive restructure of their business. Finally I thought his comment at the end was priceless…” Isn’t it ironic that the employees making $18.00 an hour at the foreign automakers plants have their taxes used to bail out the employees of the big 3 that are making $29.00 hr”?

I must say it is good to see my Liberal colleague return to the blog. It is always good to see comments particularly those from the left because they always help make my points for me. Because all of her comments came in a flurry I will try to answer them in this column rather than tackle one at a time. First let me say that the comment that I “scare her” is not surprising as most Liberals are scared of Conservatives because they paint them as terrible people that don’t care enough. However it is really about the principles of Conservatism that really scare them. For instance let me go through some of these principles rather than argue generalities.
1. A strong Family base based on raising children, for those that are fortunate to have them, and contributing to a free, safe and democratic society for all
2. The principle that every person in this Country has a right to explore and take advantage of all opportunities the Country provides. This does not include the right to be taken care of by society if you are able to do for yourself.
3. The principle that there are safety nets for those that truly need support for short or longer periods of time if you are handicapped for example. The safety net is not there to provide generation after generation with handouts so they don’t have to look after themselves.
4. The principle that as a sane individual you and you alone are responsible and accountable for the decisions you make and the actions you take.
5. The principle of a small and well functioning government that creates and maintains a minimum of laws and programs that are required to make society operate free, safe and democratic as mentioned above. Not a government that is involved in every aspect of its citizen’s daily lives.
6. Fair taxation that does not inhibit its citizens from prospering. Not taxation that drains 50% or more of citizens and businesses revenue of which part of it is reallocated to those who choose not to work. Remember I said choose which means out of the three key words “ready willing and able” there are too many that are just "able" .
As for being on the outside of Liberalism looking in, you are right but I chose to move outside because at one time many years ago I was a Liberal. After traveling around the world and seeing Liberalism/Socialism throughout Europe and Communism in the USSR I realized how it can destroy a thriving society and turn people into Government dependants. At that time I became enlightened which is a road I am trying to take you down with logic and facts.
In regards to the comments on the Constitution my point was directed to these facts. First the Canadian electorate voted for a Conservative Government. People voted individually for a leader and a government not a coalition. Second the Constitution states that the House of Commons must show non confidence in the Government through a vote in the House before any actions can be taken. This coalition was formed prior to this event taking place. Third and my main point is that both Jack Layton and Mr. Dion stated during the election they would never form a coalition with a separatist party like the Bloc and lo and behold this is what they are doing to get into power.
Finally when I raise these issues you call me “Chicken Little”. I only wish that there were more Chicken Littles around before Trudeau set about destroying our heritage by changing the immigration laws and Paul Martin before de-funding the health care system without providing any alternatives and on and on.............

It always makes me laugh when I hear people say things like “those rich CEO’s shouldn’t get any bonuses because we the little guys are hurting and they should feel the pain too”. Now be honest...are you one of these folks who demand that it’s not fair that working folks should be laid off and these big shots keep making big bucks. This has been the Liberal & socialist’s war cry for years and years and it truly reflects their ideology regarding classes if you stop and think about it. First to illustrate what I mean let me tell you an old fable from Russia that speaks of two neighbours who are walking down the street one day. Neighbour one has a large sheep that keeps his lawn trimmed by eating the grass, his table filled with her milk and his bed warm from sheets made from the wool sheared from her back. Neighbour two has no sheep and while walking down the street runs smack dab into a lamp from which a Genie pops out. The Genie says you can have one wish only so what will it be? Do you want a sheep for yourself? No said #2, I want my neighbour’s sheep to die. This short story illustrates the Liberal ideology regarding class envy. Rather than focus on improving things for everyone they would rather focus on punishing the successful to aim for fairness even if that means bringing everyone down. The entire Communist society blew up in the 80’s mainly because they had restricted personal initiative for so many years. The brightest and most talented did not excel because there was no incentive to do so. Regardless of whether they made improvements or not they would get the same as those that did nothing so why put out the effort. This is the reason that socialism and Liberalism has never worked at any time in history and yet people continue to embrace it every time major problems arise in our society. Think about it. We punish the successful and the entrepreneurs by increasing their taxes or cutting their opportunity for bonuses and what does this do for the economy. Nada! Do you think their bonus money or extra taxes are going to make a bit of difference when we are talking about a problem that encompasses billions and trillions of dollars. Do you think we will improve the economy by restricting the very people that create wealth and jobs? Of course not but it will make the Liberals & socialists feel better because they think that the entrepreneurs will feel the same pain the small guy feels. The way out of this mess is to turn these entrepreneurs loose and remove any barriers in their way. They, not governments, will create wealth and a dynamic society with jobs and opportunities for all. The government only impedes individual initiative so better it stays out of the way. Unfortunately this will not happen if more and more people want to be taken care of rather than do for themselves. Ask yourself which type of person are you?

What makes the Auto Industry different from any other business that would justify pumping taxpayer money into their failing enterprises? The employees and the management have lived high off the hog for many years producing cars that have been sub-par when evaluated against their competitors. Their prices have been higher and their reputation for quality lower when put side by side with the competition in the global automobile marketplace. They have watched Honda and Toyota steal the market from them in North America and have not responded other than to complain and moan. The management buried their heads in the sand instead of being innovative and proactive in the fight for market share. They also lacked courage when facing the steadily increasing demands of the UAW and CAW over the past two decades. Where were these brilliant CEO’s who with their MBA’s were supposed to be on top of the market and in front of the crowd with their business savvy. They and the union membership walked away with millions in salaries, bonuses, wages and benefits while the business slowly sank in the quicksand of greed. They literally killed the golden goose and now they want the taxpayers to bail them out. Of course the auto industry is important to the economy but what guarantees can the big three give that the money won’t go down the same dark hole as the rest of their assets? Every other manufacturing business in Canada has faced the same challenges over the years and if they are smart and have vision they succeeded and if not they folded. No one rushed to bail them out when they made bad decisions. Their complaints of high taxation and over regulation fell on deaf ears and they lived or died depending and relying on their own devises. I have no sympathy for all of these whiners and complainers at Ford and GM who offer no innovative solutions just a large hand reaching out for more of the taxpayers hard earned money. Here’s the advice, a) file for bankruptcy protection, b) restructure your business by eliminating losing enterprises and focussing on those that can provide the best returns in the quickest amount of time. c) Cut overhead expenses to the bone including bonuses d) reopen all labour contracts and get wages and benefits in line with your competitors (other than the big 3) e) dump current management leadership and get some people in with a mandate to build a business that will not only compete but will win in the global marketplace. f) Lobby government to deregulate where possible and to bring business taxes into line with other competing nations.
We live in a free market society and have enjoyed prosperity by doing so. We will again but we need visionaries and strong leadership not beggars and socialists looking to Government for all the answers.

If the CAW wants to protect jobs and encourage the auto manufacturers to invest in Canada then they must belly up to the bar as well. I’m not an advocate of concessions to gains already made however I would say the financial demands of the union must coincide with the economic realities of the day and who knows maybe with what we are facing today concessions could be on the table. However I do not believe that this is the major problem that all unions in general must address. The issue is the excessive amount of non productive union workers in the factories. This includes people who do not have enough work to do, those that look to avoid work wherever possible, those that manufacture overtime in place of straight time work (double bubble) and those that spend time agitating and bogging down the system with irrational issues and unfounded grievances. I started my career on the factory floor and I have worked in manufacturing for almost 40 years so I know first-hand what takes place within the union environment. I’m not suggesting that all issues and grievances are the nuisance type but there are enough of them to consume the valuable time of workers and management alike. Until unions face up to the large amount of waste created by their membership and do something about it there is not much hope for the auto industry in this country. Because of union policy everyone is to be viewed as equal and members that cheat the system whether intentionally or not are defended the same as the hard working men and women on the factory floor. The union leadership’s argument is always the same....we do not police our own members because that is the job of management. Well management has had to cut back on costs so much over the past several years that the type of supervision necessary to monitor non productive people is no longer practical in terms of costs. So the merry-go-round continues to turn and jobs continue to be lost. It is hypocritical for the union leadership to lay the blame for all of the industries’ woes on the Companies and the government of the day. To be sure each of these participants must play a part but that doesn’t mean the union can’t get off its rear end and take a stand against waste within their membership. Because the union is a political entity this obviously is a difficult thing to do but surely to God there is a strong leader out there someplace that will speak the truth and bring the membership into the 21st century. I would bet on two things if the right leader put this type of initiative to the membership as a means of doing its part to retain and gain jobs in the area they would get a positive result. It would also be such a revolutionary change to the status quo that I’m sure it would garner the attention of the auto manufacturers as a strong reason to consider doing business in our area. Governments can only do so much if we are to have a free market society and Companies are now under such financial duress that they are cutting everywhere just to stay afloat. But to date the unions haven’t addressed any of the hard issues that I have mentioned above and until they do the jobs will keep marching out of Canada. Can I guarantee that if unions change it will keep jobs here? No I can’t but nothing over the past 20 years has stopped the erosion so what does labour lose if it is proactive and takes actions to actually help the industry.

During every election in either Canada or the USA the inevitable battle cry of the Liberals and Socialists is, “tax the greedy Corporations”. The truth however is that no matter who is in power it is a rare thing to see huge tax increases levied on Corporations. The reason for this is simple economics “101”. In a free and democratic society these Corporations are in business to make a profit for their shareholders so if their costs (higher taxes) go up and they have to maintain their profit level what do you think happens? Costs have to be cut or prices have to be raised, there are no other options. To cut costs the business has to look at the two areas where they have the most control, labour and material. Cutting labour means a loss of jobs which is not what anyone wants, including the government. Cheaper material usually means off-shore purchasing and given the state of our manufacturing industry this has pretty much happened already. The other option is to raise prices (inflation) and then of course do you realize what has just happened? The consumer is paying for the tax increase of course. The other ironic thing about this ridiculous philosophy is that many of the shareholders of these Corporations are regular folks like you and I with our RRSP’s and retirement funds invested in their (mutual funds) stocks. If these Companies are not profitable then the share value drops and we know what happens then. When large Corporations have to make decisions on where to invest money you can bet that States, Provinces, Cities etc that have high corporate taxation are not going to be viewed positively. In the early 90’s I was involved in attempting to secure investment funds from our parent Company in the USA for new equipment. The CEO in New York city asked why he should even think about investing $50M in a city where property taxes on business was so high, Provincial Corporate taxes were the highest in Canada and we had a socialist government (NDP Bob Rae) that was passing anti-business labour laws. It is very tough to argue these points. The way to attract business is to offer just the opposite ......tax breaks. I’m not saying a tax holiday but an incentive to do business in our Country. At the end of the day when Company’s like GM begin to fail, because the negative impact would be so great the Government usually bellies up to the bar with our tax money anyway.

Free trade is a good concept in a truly global economy. It should provide larger markets for everyone’s products on one hand and at the same time provide a wider variety of products for all consumers around the world. The problem is that Canada and the United States entered into the agreement without a proper implementation plan. Like so many other programs that western nations have implemented over the past 50 years everyone went straight to the “results” stage and quickly passed by the “process stage” without even blinking. My career was in manufacturing and I saw many programs such as “zero inventory”, “quality teams”, “six sigma”,” lean manufacturing” and others implemented in organizations with no thought to the resources, time, effort and planning needed to make them work. Management also did not realize that employees must understand and believe in these programs if they were to have a chance of success. Free Trade is another one of these situations whereby everyone looked ahead to the results and did not spend sufficient time developing a process that would take it from start to finish in a manner that would eliminate crisis and turmoil within our borders. Our politicians at the time felt that opening borders with third world countries would provide an outlet for our products and services and therefore increase the wealth and prosperity of our country and its citizens. The problem of course is that citizens of third world countries did not have the money to purchase any of our merchandise. Therefore we first had to export knowledge to these places so they could make products and develop their economies to the point where they had purchasing power. What happened was that this knowledge was used to manufacture goods and merchandise in their countries which, achieved the objective of building and strengthening their economies. However with the ability to produce these goods at lower costs they immediately found eager markets in the western hemisphere (Wal-Mart etc) and they were away to the races. Everyone was elated at the ability of all of our citizens to be able to purchase, at low costs, all sorts of high end goods that would have been out of reach several years ago. Then something happened that made us stop and take notice. Our financial institutions and stock markets started to collapse and everyone began looking to the government to fix or bail them out. The US government went ahead and did buy up the debt incurred by these failed ( and crooked) lending institutions and within one day the largest economy in the world joined the ranks of the other socialist and communist governments around the globe. Look around and see what has happened to the manufacturing industry north of the US/Mexican border.Canada's manufacturing base is now resembling that of Russia or maybe Cuba or Venezuela. With no orderly transition of products and services released to free trade we have lost a good deal of our manufacturing prowess and along with it the higher paid factory jobs. In our economy these jobs are being replaced by either Government workers or lower paid service industry employment. Government workers are paid from taxes and when good paying private sector jobs dry up and the tax base drops guess what happens to those "G" jobs. This can be fixed but it has to happen soon. The Government must make our Country a place where Companies and entrepreneurs can flourish. Eliminate business taxes; reduce red tape and unnecessary regulations on manufacturing businesses as a start. Call a moratorium on the extreme environmental activism such as Kyoto and let Companies operate freely for a decade or more without fanatics beating down their doors about trees and emissions. Let our innovators innovate. Secondly, select one or two industries within these competing nations that are not meeting minimum manufacturing standards for safety (as an example) and put tariffs on their products until such time as they are in compliance. Once these two are in compliance drop the tariffs and then move to another two and so forth. If the other countries retaliate with trade barriers so be it. It may not make the bankers happy but it will start the process of rebuilding our manufacturing base and restoring our middle class wage earners.

Leadership, vision, and courage are rare commodities in the auto industry management ranks these days and have been that way for many years now. The last CEO with any of these qualities was Lee Iacocca with Chrysler many years ago. More than two decades ago instead of preparing and implementing strategies to improve their manufacturing processes so they could compete in a global marketplace all of the major North American Automaker's CEO’s decided to expand their market share by buying other automakers primarily in Europe. Along the way they continued to ignore the headway the Japanese were making in the marketplace. They took some lessons but for the most part missed the key message. The tactics and systems the Toyota’s etc. used to improve quality and reduce costs were excellent but it was in the implementation of these things that the Japanese excelled and those in NA failed and failed miserably. I know from firsthand knowledge that these tools and systems do work as I have implemented them in a manufacturing plant where they increased productivity, reduced costs and improved quality to the extent that the plant saw their Return on Investment rise by 15% in one year. In fact this factory which was slated to be closed in 2003 remained open after these results were achieved and is still operating today. On the other hand in another plant where I implemented the same tools and systems had success as well but never really achieved their full potential. This plant was closed because of high costs but to be fair it was combination of lower productivity, the strong CDN dollar and higher taxes which combined to make the products non competitive in the Global market. The difference in my opinion was the people on the factory floor. In one plant they were a self managed group of people who knew that the success of the business was a critical element in retaining gainful employment. They saw the key operating measurement results of the plant (including the financials) and understood what they meant to each of them. The other plant had been under the “old style” union leadership for many years and had only recently elected a forward thinking president who wanted the plant to truly succeed and didn’t just mouth empty platitudes. Unfortunately most of the members were long term employees who had the mentality of “them and us” imbedded so deep in their minds they couldn’t adjust to any significant change. The CEO’s of these automotive Company’s should have taken a stand a decades ago and fought Buzz and the union. They should have been courageous and taken their losses back then. Instead, they caved and are losing five and ten times the money now than they would have back then. And now are are also losing large portions of the business as well which, of course, negatively affects jobs. The easy way out always helps in the short term but usually is a killer in the long term. Long term to these weak management types means the time to the “next quarterly stock market report”. Does anyone think that Toyota just up and one day decided to become the best and wished it to happen? Of course not, they developed and implemented all of these tools and tactics to make it happen over a period of many years. These short-term, weak-kneed, over educated CEO’s can do more damage to a business than any one in a union could ever do and that is a fact. They get paid a ton of money and if they do the job they are worth it. Unfortunately few are.

Buzz is finally leaving and none too soon. He has presided over the unprecedented loss of thousands of auto worker’s jobs during his tenure as president of the CAW. His Neanderthal tactics and outrageous demands at critical points in the North American Auto Industry’s competitive battle with foreign auto makers helped get us to the murky mess we are in today. Certainly the management has their share of the blame but that is for another day. I have always believed that a strong union presence is essential in maintaining balance in management labour relations but Buzz wasn’t looking for balance he was looking to smash, kick, and do whatever was necessary to turn things in his favour with no regard to the health or longevity of the automotive business (the golden goose). The union strategies of the 50’s and 60’s should have been buried long before the 90’s but not in the CAW they still wanted a dinosaur leading their pack. Buzz did a good job in getting the best benefits and wages for his current membership while forfeiting future union jobs as the NA auto industry is driven to near bankruptcy. The new president will have the pleasure of seeing his membership become welfare workers as the government has to kick in millions to the automakers to stay in Canada. When the government pays some or all of your wages you are on welfare no matter which way you look at it. His political posture has also been a disaster as he went from a strong NDP supporter to a strategic voting proponent. Just like most socialists he didn’t want to vote “for” anything he wanted to vote” against something”, which so happened to be the Conservatives. I firmly believe the problem with the automakers is not the wages or benefits at this point in time it is with quality and productivity. GM Oshawa touts their plant as the most productive in North America but the competition is other GM plants. If GM is 20% less productive on average than other automotive manufacturers their claims mean little as evidenced by the closing of the truck plant. I know lots of people that work in the Oshawa plant and if they were allowed to go against their union they could come up with a great many ideas that would increase productivity, improve quality and lower costs. But Buzz and the boys don’t see that as a priority. No, they want Government handouts and trade restrictions etc to solve the problems without thinking about the ramifications of that process. His mentality is and has always been one of entitlement. The Company owes me a secure full time job no matter what and if the Company can’t provide it then let the taxpayers foot the bill. Maybe with Hargrove gone some common sense and logical thinking can prevail in the CAW union halls, I hope so because the last bastion of Ontario’s manufacturing legacy is on the verge of dying and I’d like to see a fight to save it rather than a fight to see who is strongest.