Rick Waggoner's Tin Cup

In the Wall Street Journal today, GM's CEO Rick Waggoner opines that GM should be paid welfare because it has laid off 52% of its hourly workforce since 2000 and because GM has "closed the quality and productivity gaps with the imports, as confirmed by J.D. Power and Associates". As well, a poster to my blog named Jason argues that "GM suffers a loss of $2,000 per vehicle sold. On the other hand Toyota whose employees are not part of the UAW earns a profit of about $1,200 per vehicle sold. If GM was able to operate with labor prices near Toyota’s it would have pocketed an additional $29,715,200,000."

If the problem is that serious, a bailout will not help. Nor is it correct that the fault is with the UAW.

I checked the JD Power ratings and the top quality ratings still go to Lexus and Toyota. The rating is ordinal rather than cardinal so it is difficult to precisely identiy the difference, but Lexus dominates the quality ratings with 5 circles across the board while Toyota has four and five circles. In contrast, GMC has three circles across the board. Why Waggoner refers to JD Powers is unclear, because the ratings seem to contradict his statement in the Wall Street Journal. Admittedly, I am not a car expert, but I'm not convinced that I would get equal quality buying a GM car. Maybe GM should have thought more about quality during the 30 years since this problem has surfaced.

Jason's and Waggoner's belief that direct costs are the source of GM's problem, and their finger pointing at the UAW are misguided. One of the basic principles of incentives, gain sharing and productivity sharing, principles that go back to the days of Frederick Winslow Taylor 100 years ago, is that higher labor costs are often accompanied by lower unit costs. More revealing than costs per vehicle are the blame that GM places on its workers and Waggoner's belief that layoffs are the key to competitiveness. This is misguided.

Unit costs can be lower while wages and benefits higher if processes are managed so that workers are more productive. Toyota has long had lifetime employment, which dramatically raises the quality of work life at the firm. This inflexibility (of not laying people off) would dramatically raise unit costs if Toyota were as poorly managed as GM. But workers at Toyota are more productive than workers at GM because the management is far superior.

Toyota pioneered lean manufacturing and applied TQM processes to it beginning in the 1950s. Part of this process, as described by Edward I. Deming in his book Out of the Crisis is that fear must be driven out of the workplace in order to achieve high quality processes. GM's approach has been to shift plants to Mexico and fire large swaths of workers. This would seem to be a strategy of driving fear into the workplace.

High costs per unit are characteristic of low quality and low productivity per worker. Far from unions being an explanation, high costs per unit suggest that management has failed in its primary task of eliminating special causes of variation and introducing continuous quality and productivity improvement into the plant.

If the UAW is GM's chief problem, then its repeated moving of plants to Mexico ought to have solved its problem. In Mexico, costs are pennies on the dollar compared to costs in the US. Yet, the Mexican strategy seems to have done little for GM.

I am curious if the statistics that Jason cites includes the cost of the Mexican plants, or if it is skewed by just focusing on the few US GM plants that remain.

As well, labor relations management to aim for high productivity and gain sharing is a fundamental responsibility of management. Many firms, including Southwest Airlines, have learned how to manage unions to obtain high productivity and quality. Why has GM been unable to do this?

I can say straight out that the business schools, like American business generally, have been utterly indifferent to human resource management and to questions of quality management and improvement of labor relations and HR. The business schools find HR issues to be boring and unimpressive. The Japanese don't bother with business schools and have much more successful businesses. They aren't so good at lying with statistics, though. Waggoner's spurious claim that cost per unit is a sign of GM's oppression by labor is a good example.

Birth Certificate Petition at RallyCongress.com

Rally Congress.com has a petition demanding release of Barack Obama's birth documentation. The petition is located here. The petition reads:

>Article II, Section 1 of the U.S. Constitution reads: "No Person except a natural born citizen, or a citizen of the United States at the time of the adoption of this constitution, shall be eligible to the Office of President; neither shall any person be eligible to that office who shall not have attained to the age of thirty five years, and been fourteen years a resident within the United States."

>There are numerous questions as to Obama's citizen status raising suspicion and doubt about Obama constitutional qualification to be president. To settle these questions Mr. Obama must produce proof of citizenship!

>Documents that must be produced include;
(a) a certified copy of "vault" (original long version) birth certificate;
(b) certified copies of all reissued and sealed birth certificates in the names Barack Hussein Obama, Barry Soetoro, Barry Obama, Barack Dunham and Barry Dunham;
(c) a certified copy Certification of Citizenship;
(d) a certified copy Oath of Allegiance taken upon age of maturity;
(e) certified copies of admission forms for Occidental College, Columbia University and Harvard Law School; and
(f) certified copies of any court orders or legal documents changing his name from Barry Soetoro.

>It is reasonable that these documents should be produced considering that his father is Kenyan, his adoptive father is Indonesian, and his grandmother claims to have been present at his birth in Kenya. If he is a natural born citizen then producing these documents should not be any problem.

>These allegations will not go away until Mr. Obama produces proof to federal authorities and the public. If he will not do so voluntarily he must be compelled by every means available. You, as an employee of The People, have sworn an oath to support and defend the Constitution.

>We The People are demanding you to make every effort, both public and private, to resolve this fundamental Constitutional question before 20 January.

The petition is located here.

More on Birth Certificate Law Suits

World Net Daily posts this article (h/t Bob Robbins) about Phil Berg's law suit. Janet Porter writes:

"As I wrote about last week, there are many reasons to doubt whether Barack Obama meets the requirements for the office of president. First, there's that pesky tape from Sarah Obama, Barack's grandmother, where she says, "I was in the delivery room in (Mombosa) Kenya when he was born Aug. 4, 1961." Secondly, there's the matter of U.S. law. If only one parent was an American citizen, as in Obama's case, the law at the time of Obama's birth required one parent to have been an American citizen for at least 10 years – five of which had to have happened after the age of 14. Since Obama's mother was only 18 at the time of Obama's birth, he would not qualify as an American citizen if his grandmother is right about him being born abroad."

Read the whole thing here.

Rahm Emanuel's Hitler Youth Plan

Fausta Wertz of Fausta's Blog has forwarded this podcast of the Daily News's Ben Smith's interview with Rahm Emanuel about his plan to institute a mandatory, totalitarian-style (Red Guard, Hitler Youth, classical Spartan) youth camp training for all Americans aged 18-25. Rahm Emanuel went to the same college as I did (albeit a number of years later), Sarah Lawrence College in Bronxville, NY.

We see in this video the results of America's crumbled higher education system. Mr. Emanuel is ignorant of the liberal principles that underlie American history and philosophy: the principles of individual rights and freedom, of John Locke and of the dissent of Roger Williams. Louis Hartz has argued that the New Deal and subsequent liberal tradition in America reflected a deeper Lockean liberal tradition. He was wrong. If you have not read, understood and agreed with Locke's Second Treatise on Government I do not think that you can be a good American. I do not believe that today's college graduates know what the American way of life is.

It is a mistake to elect candidates who have graduated from or taught at northeastern higher educational institutions. Northeastern universities inculcate ignorance about essential American traditions. They are not critical. They are simply ignorant. With thugs like Barack Obama and Rahm Emanuel in the White House, America is on a tragic path.

Enjoy:



Fausta writes:

>This "Civil Service Plan" is right out of Castro's Cuba, where you have to go work al campo in the countryside when you're twelve years old.

The Emanuel plan is for ages 18-25, so you don't have the outcry that using minors would generate. However, ages 18-25 are prime job-hunting ages. Anyone who doesn't comply with the "Civil Service Plan" can be blackballed from any future employment.

Notice how high schools across the country already have mandatory community service as a graduation requirement. Implementing a mandatory "Civil Service Plan" in colleges, considering how academia is sympathetic to Obama, would be the easiest thing in the world.

From that, to making the "Civil Service Plan" mandatory to future employment would only take nod from Congress.

Can't happen here?

Yes it can!