Health and Safety First
Almost daily, big industry’s top executives are demanding a moratorium or drastic slowdown in the country’s efforts to advance the health and safety of its citizens.
In the process of excusing their own mismanagement and shortsightedness, these corporate bosses are coordinating a powerful drive to make the peoples’ health and safety the first area of sacrifice.
Most vocal have been the auto industry chiefs from Detroit. Fanning out around the country and through private meetings with legislators and labor leaders, the auto companies are drumming the message of deception—namely, that the car business is in trouble because of inflationary safety and pollution standards.
This message is being carried by word of mouth down to the plant level at the sprawling auto works in Flint, Pontiac and other Michigan cities. And it is being conveyed by slick brochures to opinion makers and political leaders.
The auto industry is sick and the sickness begins with the narrow-minded bureaucrats who now run the executive suites. If these top executives were laid off and if their closest associates had their salaries cut, perhaps some truth could start emerging.
For example, if anything has to be dropped from the automobiles to keep prices down, why don’t the auto companies start with expensive styling changes, trivial “mandatory options” like vinyl roofs selling for $120, or less important high-pressured items like air-conditioning units that sell for over $400 and reduce mileage efficiency.
Instead, the heads of GM, Ford and Chrysler want safety features dropped or stopped.
CONSIDER the lack of meaningful competition as a source of higher prices. Recently, conservative Harvard economist Hendrick S. Houthakker, a former member of Nixon’s Council of Economic Advisers, cited the domestic auto industry in congressional testimony as an example of a concentrated industry that has severely diminished competition.
In normal free market pricing, he said, auto companies would be lowering the prices of their cars, keeping down unemployment and reducing inflation. Instead, the companies are halting production, laying off workers and increasing their prices despite declining demand.
“If competition is sufficiently widespread,” Houthakker states, “the economy as a whole will react to an excess of supply with a fall in the general price level. But if competition is not sufficiently strong, the economy as a whole will behave rather like the automobile industry, where rising prices and declining output go hand in hand.” He suggested that the anti-monopoly laws be enforced.
United Auto Workers Chief Leonard Woodcock has been listening too much to auto industry executives instead of to some of his close advisers and such testimony as that given by Houthakker.
IN AN astoundingly impulsive move, the usually deliberate Woodcock issued a statement calling for a reexamination and slowdown of auto safety and antipollution requirements.
It is as if his own workers and their families are not benefitting from these standards. It is as if the country is not preventing waste, economic losses and human casualties and disease by these standards. The UAW’s own economic research files rebut the phony and cruel propaganda of the car makers. While prices for Chevrolet and Ford four-door sedans were going up about $2,000 between 1967 and 1974, the auto companies themselves could only report a total price increases of $414.85 for all federally mandated safety and emission control standards in that period to the Bureau of Labor Statistics.
Even these figures are repeatedly exaggerated and the BLS has never developed the capability to examine the data behind such self-serving statistics.
Another way of putting it is that the price of an air-conditioning unit equals or exceeds the industry’s own figures about the total price of safety and pollution during the past seven years. In addition, price increases due to styling total hundreds of dollars and they, to use the corporate phrase, “are non-productive.” Consumers now are looking for value, not chrome.
I challenge any of the presidents or chairmen of the boards of the big three auto companies to a national debate on the question: “Can a humane and efficient American economy of-ford NOT to have automobiles safer and less polluting?”