Preston Tucker and the Auto Companies

Talking to DannyDonovan today about the Auto Industry bailouts, I stated that a huge problem arises when you say that something is “too big to fail.” Pouring money into something that’s failing doesn’t work; if a company can’t make money, then they need to change. They need to be discouraged from clinging to their current practices and encouraged to examine their policies and make some adjustments. If they don’t—if they can’t see that what they’re doing is ineffective—then they should fail. Someone will learn from the old company’s mistakes, and something better will emerge. As Danny said, “We have to get to the ashes before we can rise from them.”

And that reminded me of Tucker: The Man and His Dream*, a 1988 movie starring Jeff Bridges based on the true story of a man who designed and built a line of cars independent from the Detroit automakers. I hate to spoil it for everyone, but in the end, Detroit—and the government—squash him like a bug. The Big Three couldn’t handle the competition; they felt threatened by Tucker, who (according to Wiki) could make a car at the fraction of the cost and was including safety features like seatbelts and pop-out windshields.

Think about that: Detroit’s Big Three completely suppressed an individual’s new, “revolutionary” ideas, and they did it with the federal government’s help and blessing. And that was in the 1940s. Imagine what could have happened if they had been forced to compete with Tucker. They may have been forced to add seatbelts and other safety features sooner (Ford didn’t add them until the mid-1950s as an option); it’s possible that they may not have expanded into the monoliths that are apparently “too big to fail” now. Or they may have legitimately shut Tucker down.

However, the government insulated these companies from competition (even in the 1940s!); they didn’t even give Tucker—the individual, the “little guy,” the innovator—a chance to compete. Even way back then, the government was, in a way, facilitating the failure of the Big Three and discouraging individualism. I wonder how many other times the government has gone to bat for these companies and prevented them from having to participate in the free market. And what good has it done? It’s delayed the inevitable. The sun is trying to set on the Big Three, but the government is there, holding onto the chariot and keeping it from reaching the horizon. And it’s high time they stopped; seriously, there’s no need to perpetuate the twilight. Let the industry fail, and let something better rise out of the ashes.

*Tucker, btw, is a great movie. My boyfriend made me watch it last Fall and I actually really liked it. I was sick of “Hold that Tiger” by the end, though…

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