This past week, the Ford Motor Company has been the target of multiple-front attacks because they made a decision, based on their responsibility to their stockholders, to provide them a positive return on their investment. They announced they are moving all of their “small car” production to a new plant being built in Mexico. HOW DARE THEY?!?!? The screams of heresy have ricocheted all over the news media, the political landscape and even the Presidential race. The politicians are beside themselves with visible and loud contempt for Ford. We know those nasty greedy corporate scum are throwing Americans out of jobs while padding their pockets!
The thing that seems to be missing in this whole conversation is the “why?” I mean the obvious “why” is their legal and ethical responsibility to their investors. But why is Ford doing this now? Why, in this time of heightened awareness of the whole “off-shoring” thing, would this iconic American company make this announcement? Could it be that Ford is trying to start the conversation on the bigger subjects involved? Well, what is/are the “bigger subject(s)” involved in this decision? Is it now time, as we’re starting to actually look at what is burying the American Dream, to discuss whom and what are doing the shoveling? I remember a time when the curiosity of We The People would cause US to find the reasons for, and the evidence supporting, actions like this, rather than just accept the narrative advanced by the “talking heads” and politicians. Shall we?
The first point in this is that in our economic model, the first and foremost responsibility of the directors of EVERY corporation is to those who invest in the company, the stockholders. For the Directors of any corporation to do otherwise is a violation of the law. The whole of our economic system rest on this principle. We must support this principle as a nation or the whole structure of our society will crumble. In doing their due diligence as the directors of Ford Motor Company, the evidence showed that there was a need to move the production of “small cars” to a manufacturing environment that was more conducive to efficient and effective, and economically viable, production of these particular vehicles. The conclusion was that with the costs structure of US manufacturing, including the requirements of Ford’s union contracts, to manufacture these “small cars” with any possibility of a profit, or at least not a major loss, this production must be moved out of the Country. The fact is that if it could, Ford would probably just cease making these particular products. So, why do they keep building them if they can’t do so at a profit? Hmmm, I think we may have just stumbled on the REAL pertinent question in this discussion.
The fact is that ALL automakers are forced to manufacture these “non-profit” vehicles because of an illegal 1975 national government intervention. That should be the subject of this discussion, not who is moving what, where. The ONLY reason Ford even builds the Fiesta to offset its flagship profit vehicle, the F-150 pickup truck (all of which are built in the US), is because the US national government in 1975 instituted the “Corporate Average Fuel Economy (CAFE) standard” and has been using it to continually tighten the screws on the automotive industry every since. If this stupid government intervention program wasn’t in place, I’m betting Ford wouldn’t even be building any of these cars that they are moving to Mexico. I know that the “narrative” is “Slam Ford for moving vehicles to Mexico”, but the real story should be “Ford moving ‘small car’ production to Mexico so the government will allow them to continue to build the vehicles Americans want in the US”.
Yes, we are again witnessing how the national government’s actions NEVER take the “Laws of Unintended Consequences” in to account. In 1975 Congress, in response to the 1973/74 Arab oil embargo, enacted the CAFE standards to “improve the fuel economy of cars and light trucks produced in the US.” This was later expanded to not just vehicles produced in the US, but to all cars and light trucks sold in the US. (In reaction to the rush to off-shore manufacturing of motor vehicles) Now it has expanded to virtually ALL vehicles sold in the US. You can read the national government’s propaganda manifesto about the current CAFE here- https://www.transportation.gov/mission/sustainability/corporate-average-fuel-economy-cafe-standards
So, when the politicians, and the pundits alike, are all throwing Ford “under the bus” for their “evil and greedy” decision to move all “small car” production to Mexico, we must remember that the real evil behind it is because the national government decided to, in 1975, go far beyond its Constitutional limited powers and again ignore the “Laws of Unintended Consequences”. Whoda thunk it?
God Bless America! And America, Bless God Again!
