Detroit Free Press from Detroit, Michigan on February 10, 1985 · Page 68
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Detroit Free Press from Detroit, Michigan · Page 68

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Sunday, February 10, 1985
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Hi- DETROIT FREE PRESSSUNDAY, FEB. 10, 1935 Those politicians sure think we Americans are fools , Poll after poll shows the contempt the American people have for politicians. What is more carefully concealed is the contempt American politicians have for the people. This contempt is the central, unstated fact of the current controversy over the budget. It explains the inconsistent and illogical behavior of the principal players in the sordid drama, including Ronald Reagan, Tip O'Neill and Bob Dole. Reagan, for starters, knows that much of his new budget isnonsense. He knows that it makes no sense to pretend to be sweeping up every wasteful odd and end in the welfare area while avoiding even a minimal attempt to contain Social Security, which dwarfs all of the above. ' Capitalizing on the American people's lack of memory, Reagan ignores his record of insisting on changes to rationalize the future financing of Social Security. Instead, the White House recalls only Reagan's one intellectual stumble on this subject when, cornered during the campaign, he foolishly promised not even to consider limiiing excessive planned increases in the 21st Century. REAGAN KNOWS this is stupid, even though his political advisers assure him that it helped him carry 49 f Louis VVL 1 lialteysei states. He knows that Social Security is heading inexorably for a receipts-vs.-outlays crisis that would mock all other efforts to bring order to federal finances. Secretly, he hopes Congress will override him and pass legislation to limit future benefit increases in Social Security four years ago, it acted on its own to pass tax indexing, which he had failed to propose, privately admired and subsequently embraced. Such action by Congress on Social Security would be good for the country, Reagan knows, but he is unwilling to risk his own political capital in its behalf. In short, Reagan is not on the level with the American people about Social Security. Which takes us to our noble leaders in Congress: Tip O'Neill, who vacillates between telling us what a national statesman he is and how Reagan's budget can stew in its own juices for all he cares, and Bob Dole, who can't quite decide whether it's going to be a better idea in 1988 to run for president for or against Reaganomics. Neither case of nonstop wind-sniffing displays any conspicuous reverence for the intellect of the populace allegedly being served. O'Neill's unwillingness to confront anything even faintly reminiscent of a politically challenging idea is so familiar that he has become a caricature of conventional Washington hauteur, but Dole because he is occasionally less predictable presents a more interesting case. OVER MUCH of the last three years, Dole's reputation was built on periodically convincing Reagan's aides that the old man would be crazy not to raise taxes. This approach may not have done beans for the deficit, which predictably grew larger every time Congress passed another economy-slowing tax, but it did wonders for the senator's media reputation as a moderate and a realist. Scant wonder a modicum of cynicism swelled beneath his brow. More recently, however, Dole seems to have sensed that the great unwashed are yearning for a new repertoire. Reading the 1 984 returns with close attention, he has backed away from one more round of tax increases, while affirming piously that not even national defense can be sacrosanct in a historic assault on federal spending. Alas, a contempt for the people's intelligence surfaces. For the debate on defense continues to miss the real issue which is not whether some buildup of depleted U.S. military strength is essential, but whether the continuing waste and mismanagement of Pentagon resources is to be maintained wherever politically convenient The classic point here, and one studiously avoided by White House and congressional leaders alike, is that billions are wasted on unnecessary and overlapping military bases all over the country. Until we get legislators willing to say: "And get rid of the outmoded base in my district, too," it will be apparent that all the talk about reducing our $2 trillion debt barely conceals the politicians' contempt for what we the people really want, understand and believe. And so the contemptible deficit burgeons. Lousma takes on new mission as consultant LOUSMA, from Page 1F ; Servo Kinetics, which was founded in; 1982 and posted 1984 sales of $1.3 million, repairs precision valves, hydraulic pumps and electronic circuit boards. , Environmental Research Institute of Michigan, a non-profit research and development group, designs remote sensing devices for laser scanners, radar and other defense and industrial uses. Lousma said he would help the institute look for new applications for its technologies in defense and environmental monitoring from space, promote its work and help it gain federal research and development grants. LOUSMA'S NEW CLIENTS say his previous connections with the aerospace industry are a plus, but his background in aerospace engineering is what they really value. Lousma has a bachelor's degree in aeronautical engineering from the University of Michigan and an advanced degree in aeronautical engineering from the U.S. Navy's postgraduate school in California. "Jack knows a lot of people, but Jack's expertise is really what we wanted Jack for," said George Kokalis, president and owner of Servo Kinetics Inc. Lousma says he has a rare combination of experiences that make him valuable to Rockwell International's effort to win a bid to build a permanent space station for the 1990s. "I'm one of the three guys in the world who has both flown the space shuttle and lived on the space station," he said. In addition to serving as commander of the Columbia space shuttle in 1982, Lousma was on the 59-day Sky-lab space shuttle mission in 1973. Asked if the visibility of his Senate campaign helped him line up his clients, Lousma said: "I don't go around promoting myself as either (astronaut or candidate). "I go around promoting myself as someone who knows the aerospace business, who has a lot of personal experience in it and who can help Michigan in (the) revitalization of its economy." Lousma says that after the November election, a number of local compa- i f -- - i ii jtnrm niMMii Above: Jack Lousma as an astronaut. Upper right: Lousma in his campaign for U.S. Senate. Right: Lousma as a business consultant. -. , ws8t :. ... J? " ' M ,,', . ..'.. AV . Jm nies contacted him about working with them on aerospace or defense projects. "They knew that I had a background in aerospace, that I knew people in aerospace and that I had a demanding technical type of a job where technical expertise would be required," he said. "So I understand their systems as well as being able to get them where they need to go." Lousma says he is leaving his op tions open for a 1988 Senate race. But he added:"I am not structuring my life at this point in time to accom modate a run for public office. I am simply trying to spend more time with my family and make a living. "I chose this because this is my basic interest," he said. "This is where my expertise lies." Players are split on question of auto quotas QUOTAS, from Page 1F administration has adopted no official policy on whether to ask the Japanese for a fifth year of quotas, according to a top White House official. In previous years, the United States always entered the negotiations with a number in mind, but no agreement was reached at a recent Cabinet council meeting on the issue, so no recommendation was made to President Reagan. "No one spoke up in favor of an extension this time," said one congressional source. Another administration source agrees that the meeting showed less sympathy for U.S. automakers than in the past. A classified Commerce Department report submitted to the Cabinet concluded that U.S. automakers are ready to compete with Japan, despite contrary claims from Chrysler Corp., Ford Motor Co., American Motors Corp. and the UAW, who want another extension. Brock and Commerce Secretary Malcolm Baldrige are thought to be undecided about whether to ask the Japanese for a fifth year of restraints, but both were critical last year of the large bonuses that auto executives were paid after a record profit year in 1983. U.S. automakers are sharply divided over the issue. FORD, CHRYSLER CORP. and AMC say the U.S. auto industry needs more time to toughen its ability to compete with Japan on cost and quality and fully recover its multibillion-dollar investment in new plants and products. "We've made a lot of progress since the restraints," said Ford Controller David McCammon. "We've increased productivity by 35 percent, improved quality by 55 percent and reduced our costs by $4.5 billion. But the competitive problem has not been completely licked," he said, adding that the strong U.S. dollar, which makes imported Import share of U.S. auto market, and Japan's share of the total. All Japan 1972 14.8 5.8 1973 15.4 6.6 1974 16.0 6,7 1975 18.3 9.5 1976 14.8 9.3 1977 18.5 12.2 1978 17.5 12.0 1979 21.7 16.6 1980 26.4 21.1 1981 27.1 21.7 1982 27.6 22,6 1983 25.9 20.9 1984 23.4 18.4 Sturca: Ford Motor Co. and industry reports goods cheaper for Americans, is exacerbating the situation. General Motors Corp., on the other hand, wants the quotas killed. GM, which owns an interest in two Japanese producers, Isuzu and Suzuki, would like to import about 300,000 Japanese cars a year to sell through GM dealers. That's something it won't be able to do unless the quotas are scrapped or loosened. Also lining up against the quotas are the roughly 7,000 imported car dealers throughout the U.S. Meanwhile, the two biggest Japanese car companies, Toyota and Nissan, are calling publicly for an end to the quotas. "That's a crock," said one administration source, citing the fact that the two Japanese giants make an estimated 70 to 90 percent of their total profits from U.S. sales. "That's what they say in public; privately, they want the controls to stay on," agreed a congressional source. Representatives of the largest Japanese car firms agree that Toyota, Nissan and Honda have profited mightily from the quotas. WITH THE supply of Japanese cars artificially limited in the United States, they can be sold before they even hit the lots, often for above the sticker prices and loaded with expensive extras. Even better for the larger Japanese firms, the quotas, which are allocated among the country's automakers by the Japanese government, give only small portions of the U.S. market to smaller Japanese firms and newcomers. The result has been to save the Japanese Big Three from the kind of fierce price competition they face in Japan. "You have seven or eight companies selling in a stagnant (Japanese) market of 3.5 million cars a year," said one analyst. "They compete mainly on price." The United States represents a profitable safety valve. What would happen if the quotas were lifted? An end to the quotas would likely mean cheaper Japanese cars, many investment analysts and car dealers believe. "Right now, I'm able to charge up to $1,000 above sticker on the Hondas I sell, strictly because of market conditions with the quotas," said Jeff Zem-brosky, a Pontiac and Honda dealer in Cedarburg, Wis. "If the quotas are lifted, I doubt I'd be able to keep doing that. Some Japanese cars just wouldn't be as hard to get in high volumes as they are now." MECHANICAL ENGINEERING EDITOR Outstanding opportunity for a talented technology writereditor to cover mechanical engineering for HIGH TECHNOLOGY, a paid subscriptionnews-stand magazine with a circulation of over 300, 000 Buslnesspeople and Technical Professionals. Candidates should have backgroundeducation In Engineering as well as knowledge of emerging technologies in the automobile, machine tool, metal working and other related Industries. The ability to analyze new developments and markets, plus excellent reporting and writing skills are also required. Send resume, writing samples, salary history to: EDITOR HIGH TECHNOLOGY 38 Commercial Wharf Boston, Mass. 02110 No Phone Calls Please THERE ARE two conflicting theo ries about how ending the restraints might impact U.S. carmakers. One is that there would be relatively little, if any, immediate effect, This theory says that even without the limits, the Japanese would not take dramatic steps to increase their share of the U.S. car market because they don't want to touch off a new wave of protectionist sentiment in Congress. The other view is that the Japanese share of the U.S. car market would mushroom within a short time, from around 1 8 percent now to as much as 35 or 40 percent by the end of the decade. According to industry estimates, Japan's share of the current market is about 20 percent. Lifting the quotas, some analysts also say, could mean less Japanese investment in the U.S. plants. Officials of the Mazda Motor Corp., for example, have said repeatedly that the main reason behind their decision to build a $450 million auto plant in Flat Rock was the expectation that the quotas would remain. One thing is clear, say analysts. If quotas were lifted, the small-car segment of the American car market would be most vulnerable. Because of lower manufacturing costs and the strong dollar-yen relationship, Japanese automakers can build a small car for $1,500 to $2,500 less than U.S. manufacturers. That has caused American automakers to lower small car prices to the extent that they make few, if any, profits on small-car sales. 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