The story of the American automobile industry – the Big Three – in the second half of the twentieth century has not been a pretty one.

During the late seventies and eighties, the domestic auto industry suffered severe losses, while foreign competitors gained larger and larger percentages of the American auto market.

With severe losses came severe job losses; since the 1950’s, unemployment rates in Michigan have consistently surpassed national averages in times of recession due to its floundering auto industry. For instance, 1982 unemployment rates averaged around 15 percent, 60 percent above the national average.

These job losses have continued into the new millennium. Michigan suffered six straight years of job losses through 2006, and many of those losses were in manufacturing, 70 percent of which were in the auto industry. However, Americans continue to reminisce about the domestic auto industry’s glory days, when manufacturing jobs could provide a good wage and a good pension.

Today, manufacturing jobs in America’s auto industry continue to offer good wages and good pensions, in you can find yourself a job. However, the industry’s unwillingness to produce fuel-efficient vehicles has failed the Big Three.

Meanwhile, another auto industry has been taking root in America’s backcountry.

In the past two decades, a foreign auto industry has built itself up in southern states.  This foreign industry – some call them the “Little Eight” – has succeeded in producing automobiles that Americans want to buy, and is non-union. In 2007, the foreign automakers directly employed more than 97,000 workers, according to the Association of International Automobile Manufacturers.  These jobs then support local steel and rubber industries, as well as auto dealers.

Foreign automakers indirectly employed nearly 575,000 workers, in 2007, compared to the Big Three, who employ 240,000 workers.Therefore, the numbers would suggest that America does not need a domestic auto industry.  However, there is more than numbers behind the argument opposing the government’s bailouts of the domestic auto industry.

As of mid-May, the auto bailout has run up a bill of more than $80 billion, or more than $250 per American.

That is $80 billion not spent on healthcare, public education, or infrastructure.

The American government has teamed up with the Big Three to subsidize a shrinking industry, which will compete with a growing industry that employs hundreds of thousands of Americans. Who will benefit from this?  Surely, not the American people or the American economy.

In a globalizing world, America’s economy will have to be retooled if it is to compete with foreign economies. America is no longer a hub of global manufacturing; those jobs have been outsourced and are not likely to return. Therefore, the energy of the American people and the American government must be directed in the direction of growing industries; a good start would be to invest in the electrical grid and in public education. 

Education will be a key factor in determining the success of America’s economy in the decades to come. Instead of keeping afloat a sinking auto industry, our government should be working to provide its citizens with higher educations and training programs for the jobs of tomorrow.

America is a strong and vibrant nation, and is greatly benefited by the productivity and work ethic of the American worker. If this energy can be used to create new industries, and new jobs, then America’s economy will prosper.

To accomplish this, President Obama must let old industries go by the wayside, leaving a void for new industries and economic growth.

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