Auto Industry DA

7/21/2019 Auto Industry DA

http://slidepdf.com/reader/full/auto-industry-da 1/42

1NC

Auto industry is slowly rising

Ted Reed 09/04/12 - 10:34 AM EDT Ted Reed covers the transportation industry. e previous!y covered the air!ine industry"or #0 years "or pu$!ications inc!udin% The &har!otte '$server( Mia)i era!d and *acra)ento +ee. e a!so ,ored "or *Air,ays( ,ritin% interna! pu$!ications and speeches "or the co)panys eecutives. e is a %raduate o" es!eyan niversity andho!ds a )asters in 2ourna!is) "ro) &o!u)$ia niversity.

DETR'T -- The*treet5 -- Automakers are reporting strong August sales as the auto industry remains

a bright spot in a mediocre economy . 6ord 65 said Au%ust sales gained 13%; ! "!# said sales rose

1$% and Chrysler reported a 1% gain. &oyota "&!# sales rose '%. 7The auto industry has $een a

$ri%ht spot "or the econo)y a!! year !on% and that ,i!! continue(7 8M econo)ist *ue in%i *ue said Tuesday

)ornin% on a con"erence ca!! ,ith reporters. *he said a revision $y the )ureau o* +conomic Analysis enables

a slightly higher estimate o* 1.2 million to 1.3 million *or the seasonally ad,usted annuali-ed sales

rate. 6ord sa!es tota!ed 19;(#49( ,ith retai! sa!es up 19<. *a!es o" the 6ord Escape co)pact uti!ity vehic!e rose3;< to #=(1==. 6usion sa!es rose #1< to #1(>90. 6-*eries sa!es rose 19< to ?=(#01. @inco!n sa!es rose #< to =(141( $ut @inco!n retai! sa!es rose #1<. 6iesta sa!es "e!! #=< to 4(1;>. en &u$ay( 6ord vice president( .*. )aretin%(

sa!es and service( said )any custo)ers visit the sho,roo) to see the 6iesta( $ut end up $uyin% a 6ocus. 8M saidAu%ust sa!es tota!ed #40(?#0. Retai! sa!es rose 11<( )ain% Au%ust the $est retai! )onth o" the year( ,hi!e "!eetsa!es rose ><. A!! "our 8M $rands posted hi%her tota! and retai! sa!es( ,ith &hevro!et up 11<( &adi!!ac up 11<(+uic up 1#< and 8M& up 4<. +uic had its $est retai! sa!es )onth o" the year and its $est Au%ust since #00>. The

$rand is tracin% to its $est retai! sa!e year since #00>. ndustry sales growth is being mo/ed by pent0up

demand( *ue said( notin%( 7eople ha/e been holding o** new purchases *or such a long time( since

2$$ until now . +/en though the economic news is /ery mediocre( /ery slow( and /ery moderate( we

see impro/ement o/er all. n particular( ,ob growth is continuing and consumer con*idence is

impro/ing ( she said. 8M said that "our vehic!es -- &rue( *par( *onic and Bo!t -- set )onth!y sa!es records inAu%ust( he!ped $y advertisin% durin% the '!y)pics. &rue so!d #?(9;? units( *par so!d #(>30( *onic so!d =(;03 andBo!t so!d #(=31. &hrys!er( the "irst auto)aer to report Tuesday( said Au%ust sa!es rose 14< to 130(1#0 units( its $estAu%ust tota! since #00;. Dod%e $rand sa!es rose 13< to 4;(34=( ,hi!e Ceep $rand sa!es rose ?< to 4#(=39. *a!es o"the Dod%e Ra) picup truc( the %roups $est-se!!in% vehic!e( rose 19< to #?(#1?. *a!es o" the ne, Dod%e Darttota!ed 3(04?. Bo!s,a%en said Au%ust sa!es rose >3< to 41(011.

4nsert 5ink6

Automoti/e industry is /ital to the economy

7ill et al 1$0 *ustaina$!e Transportation and &o))unities 8roup and ro2ect @ead( ro2ect Mana%er o" the center "or auto)otive

research( Research Associate at the center "or auto)otive research( i)( De$$ie Men( Ada) &ooper( &ontri$ution o" the Auto)otive ndustryto the Econo)ics o" A!! 6i"ty *tates and the nites *tatesF( http://,,,.oesa.or%/Doc-Bau!t/ndustry-n"or)ation-Ana!ysis/&AR-Econo)ic-*i%ni"icance-Report.pd"0 .

&he automoti/e industry is a /ery important industry in the 8.9. economyG no other sin%!e industry !ins as

c!ose!y to the .*. )anu"acturin% sector or direct!y %enerates as )uch retai! $usiness and overa!! e)p!oy)ent. !anu*acturing has $een the backbone o* the American economy( and the automoti/e industry is its heart. A !oo at the entire

production and supp!y chain provides a rich narrative o" ho, a stron% automoti/e industry historica!!y supports the

growth and stability o* )any other industries ( such as $asic )ateria!s supp!iers o" stee!( p!astic( ru$$erand %!ass( ,hich are used "or )ain% $odies( interiors and tri)( tires( %asets and ,indo,s. 6i%ure 1.4 provides

a co)parison o" the va!ue added per e)p!oyee )easured in thousands o" do!!ars per year5 across severa! )anu"acturin% industries. The va!ueadded per e)p!oyee can $e thou%ht o" as the di""erence $et,een the cost o" )ateria!s and the sa!e price o" the %ood. E""ective dep!oy)ent o" !and(

!a$or( and capita! create va!ueG in #00>( each e)p!oyee in the )otor vehic!e asse)$!y industry created H3#1(000o" va!ue in the "ina! products shippedG "ourth hi%hest a)on%st )anu"acturin% industries. An economy is

rein*orced by the si-e and ,ob creating capability o* its manu*acturing base . ithin the $road )anu"acturin%

!andscape o" the .*.( *ew industries are as !ar%e or pro/ide so )any indirect and ancillary opportunities *or

,ob creation as the motor /ehicle industry. 6i%ure 1.? hi%h!i%hts the sheer sie o" the )otor vehic!e asse)$!y and parts

http://www.oesa.org/Doc-Vault/Industry-Information-Analysis/CAR-Economic-Significance-Report.pdf0







)anu"acturin% industry ,hich is the second !ar%est e)p!oyer ,ithin the su$set o" )anu"acturin%. *o)e industries inherent!y create )ore 2o$s

than other industries. A hi%h 2o$s creation )u!tip!ier tends to $e associated ,ith industries that reIuire !ar%ea)ounts o" inputs "ro) other industries( source inputs "ro) industries that have a hi%h re%iona! purchasecoe""icient( or pay a$ove avera%e ,a%es.

+conomic collapse leads to war

Royal 1$ Cedediah( Director o" &ooperative Threat Reduction at the .*. Depart)ent o" De"ense( #010(Econo)ic nte%ration( Econo)ic *i%na!in% and the ro$!e) o" Econo)ic &rises( in Econo)ics o" ar and eace:Econo)ic( @e%a! and o!itica! erspectives( ed. 8o!ds)ith and +rauer( p. #13-#1?5

@ess intuitive is ho, periods o* economic decline )ay increase the likelihood o* e:ternal con*lict. o!itica!

science !iterature has contri$uted a )oderate de%ree o" attention to the i)pact o" econo)ic dec!ine and the security and de"ence $ehaviour o"interdependent sta!es. Research in this vein has $een considered at syste)ic( dyadic and nationa! !eve!s. *evera! nota$!e contri$utions "o!!o,.

6irst( on the syste)ic !eve!. o!!ins #00=1 advances Modc!si and Tho)psons 199>5 ,or on !eadership cyc!e theory( "indin% that rhythms

in the %!o$a! economy are associated with the rise and *all o* a pre0eminent power and the o"ten

bloody transition *rom one pre-e)inent leader to the ne:t. As such( e:ogenous shocks such as economic

crises could usher in a redistribution o* re!ative power see a!so 8i!pin. 19*C5 that leads to uncertainty

about power balances( increasing the risk o* miscalculation 6caron. 199?5. A!ternative!y( even a re!ative!ycertain redistri$ution o" po,er cou!d !ead to a per)issive environ)ent "or con"!ict as a risin% po,er )ay see tocha!!en%e a dec!inin% po,er erner. 19995. *eparate!y. o!!ins 199>5 a!so sho,s that %!o$a! econo)ic cyc!es co)$ined ,ith para!!e!

!eadership cyc!es i)pact the !ie!ihood o" con"!ict a)on% )a2or( )ediu) and s)a!! po,ers( a!thou%h he su%%ests that the causes and connections $et,een %!o$a! econo)ic conditions and security conditions re)ain unno,n. *econd( on a dyadic !eve!. &ope!ands 199>. #0005 theory o" tradeepectations su%%ests that "uture epectation o" trade is a si%ni"icant varia$!e in understandin% econo)ic conditions and security $ehaviour o"states. e ar%ues that interdependent states arc !ie!y to %ain paci"ic $ene"its "ro) trade so !on% as they have an opti)istic vie, o" "uture trade

re!ations. o,ever( i* the e:pectations o* *uture trade decline( particularly *or di**icult to replace ite)s

such as ener%y resources ( the likelihood *or con*lict increases ( as states will be inclined to use *orce to

gain access to those resources. &rises cou!d potentia!!y $e the tri%%er "or decreased trade epectations either on its o,n or $ecause it

tri%%ers protectionist )oves $y interdependent states.4 Third( others have considered the !in $et,een econo)ic dec!ine andeterna! ar)ed con"!ict at a nationa! !eve!. Mo) $er% and ess #00#5 "ind a stron% corre!ation $et,een interna! con"!ict

and eterna! con"!ict( particu!ar!y durin% periods o" econo)ic do,nturn. They ,rite. &he linkage( between

internal and e:ternal con*lict and prosperity are strong and mutually rein*orcing. Econo)ic con"!ict!ends to spa,n interna! con"!ict( ,hich in turn returns the "avour . Moreover( the presence o" a recession tends toa)p!i"y the etent to ,hich internationa! and eterna! con"!icts se!"-rein"orce each other !o)henJ K ess. #10#. p. L9

Econo)ic dec!ine has a!so $een !ined ,ith an increase in the !ie!ihood o" terroris) +!o)$cr%. ess. K ee ra pan a(

#0045. ,hich has the capacity to spi!! across $orders and !ead to eterna! tensions. 6urther)ore( crises %enera!!y reducethe popu!arity o" a sittin% %overn)ent. 7i/ersionary theory suggests that( when *acing unpopularity

arisin% "ro) econo)ic dec!ine( sittin% go/ernments ha/e increased incenti/es to *abricate eterna! military

con*licts to create a ra!!y around the "!a% e""ect. an% 199>5( DcRoucn 199?5( and +!o)$cr%. ess( and Thacer #00>5 "ind

supportin% evidence sho,in% that econo)ic dec!ine and use o" "orce arc at !east indirecti5 corre!ated. 8e!pi 199;5. Mi!!er 19995. and isan%aniand icerin% #0095 su%%est that he tendency to,ards diversionary tactics arc %reater "or de)ocratic states than autocratic states( due to the "actthat de)ocratic !eaders are %enera!!y )ore suscepti$!e to $ein% re)oved "ro) o""ice due to !ac o" do)estic support. DeRouen #0005 has

provided evidence sho,in% that periods o" ,ea econo)ic per"or)ance in the nited *tates( and thus ,ea residentia! popu!arity( are

statistica!!y !ined !o an increase in the use o" "orce. n su))ary( rcccni econo)ic scho!arship positive!y corre!ates econo)ic

inte%ration ,ith an increase in the "reIuency o" econo)ic crises( ,hereas political science scholarship links

economic decline with e:ternal con*lict a! syste)ic( dyadic and nationa! !eve!s. This i)p!ied connection $et,een inte%ration(

crises and ar)ed con"!ict has not "eatured pro)inent!y in the econo)ic-security de$ate and deserves )ore attention.



</er/iew

Cross Apply our Reed e/idence0 Auto industry is a critical spot to economic growth(

perception( and consumer in/estment but these times are key because industry is risingslowly.

45ink Analysis6

+:tend our 7ill e/idence0 &he auto industry is the backbone o* the economy because it is

critical to ,ob growth( spillo/er to other industries( and inno/ations o* technology.

+:tend Royal0 An economic collapse leads to war( as our e/idence gi/es speci*ics warrant

that the =linkage( between internal and e:ternal con*lict and prosperity are strong and

mutually rein*orcing> as country antagonisms grow due to *ewer industries and resources.

?e control the internal links to war scenarios( and this disad turns case.

&urns case @ auto industry collapse destroys the ability to build alternati/es( and makes

their impacts ine/itable

arlin B "ounder( editor and pu$!isher o" +u6!ash at Truth'ut or%aniation Mar( Dece)$er #009( &hosen to appear in +!oo)$er%Ns

+usiness ee( A)ericans *hou!d +uy .*. &ars( eriod(F +usiness ee(http://,,,.$usiness,ee.co)/de$ateroo)/archives/#009/0#/a)ericansOshou!dO$uyOusOcarsOperiod.ht)!Pshare 5A short ti)e a%o( )y ,i"e and $ou%ht an A)erican car( a 6ord 65 6ocus( and !e"t the dea!ership "ee!in% very proud. didnNt epect thatQthe

pride in doin% our s)a!! part to he!p )aintain the .*. auto industry ,hi!e it reinvents itse!"Q$ut it ,as there. eNre A)ericans( and ,e areassistin% A)erican si!!ed ,orers and an industry that is essentia! to our nationNs econo)ic recovery( as ,e!! as one potentia!!y si%ni"icant to our

nationa! security as it ,as in or!d ar 5. *o)e private industries are inte%ra! to !on%-ter) nationa! "inancia!via$i!ity. The Detroit car industryQ!ie our aircra"t )anu"acturin% capacityQ"a!!s into this cate%ory. e are a!! a,are that in todayNs %!o$a!

econo)y so)e parts on .*. cars are "ro) overseas( and even so)e )ode!s are asse)$!ed e!se,here. +ut the "act re)ains that a nation

that abandons its core manu*acturing base is committing itsel* to economic dependence on o/erseas

corporations and countries. *o the Iuestion "or )y ,i"e and )e ,as this: Do ,e %o ,ith a s!i%ht!y hi%her-rated "orei%n co)pact oran A)erican car that has 2ust a$out cau%ht upJ e didnNt have to ponder !on%. Detroit and the A need consumers to

belie/e in the present and *uture o* a re/itali-ed 8.9. transportation industry . And yes( "u!!y supporttransportation di/ersi*ication into hi%h-speed trains( )ass transit( and other a!ternatives to cars( but its

easier to branch out *rom an e:isting production capacity than to start *rom scratch. The $estecono)ic invest)ent in rea!iin% that %oa! is to $uy an A)erican car.

http://www.businessweek.com/debateroom/archives/2009/02/americans_should_buy_us_cars_period.html#share

http://www.businessweek.com/debateroom/archives/2009/02/americans_should_buy_us_cars_period.html#share



Currently *a/orable business conditions are /ital to car technology @ the ne:t *ew years are

key to the long term transition

! Ean 2$1$

http://,,,.p)%.co)/*/en/ssuesAndnsi%hts/Artic!esu$!ications/Docu)ents/trans"or)ation-auto)otive-industry.pd" 6or ea)p!e( Toyota is no, p!annin% to introduce c!ean diese! en%ines a"ter havin% !aunched a success"u!hy$rid pro%ra). Toyota a!so p!ans to introduce !ithiu)-ion hy$rid vehic!es in so)e )arets throu%h a 2oint venture ,ith their $attery supp!ier( anasonic. Companies )ay increasin%!y engage their

suppliers( and sometimes their competitors( to bring best0o*0breed technologies to the market atthe !o,est cost. 9ince technology costs highly correlate with manu*acturing scale( a small number o*

suppliers with large *ootprints in a technology area may emerge as cost leaders ,ith a si%ni"icantco)petitive advanta%e. *o)e o" these suppliers may also *orm regional clusters based on

go/ernment incenti/es and other *a/orable business conditions. 6edera! "unds introduced $y thenited *tates %overn)ent "or RKD in c!ean techno!o%ies and "or re-too!in% eistin% "actories )ay)otivate co)panies to increase their nited *tates "ootprint. &he ne:t G to 1$ years may bring

substantial structural changes to the automoti/e industry. A!thou%h a !ar%e portion o" the %!o$a!auto)otive industry is sti!! in distress( companies ha/e to look beyond their short0term sur/i/al

challenges to become success*ul in the long run. A !on%er-ter) strate%y ,i!! invo!ve re$a!ancin% product port"o!ios and sheddin% unpro"ita$!e assets( as ,e!! as investin% in strate%ic %ro,th areas throu%ha co)p!e ,e$ o" %!o$a! re!ationships. As a resu!t( success"u! co)panies ,i!! increasin%!y $eco)e%!o$a!( asset !i%ht( and responsive to )aret shi"ts. A c!ear!y de"ined %!o$a! MKA strate%y ,i!! p!ay ado)inant ro!e in separatin% ,inners "ro) !osers( and eventua!!y shape the "uture o" the %!o$a! auto)otiveindustry.



5inks



eneric

ublic policy trades o**

9lack et al B --ro"essor E)eritus in the Depart)ent o" 8eo%raphy at &oncordia niversity +rian(Cean-au! Rodri%ue-- pro"essor at the Depart)ent o" Econo)ics and 8eo%raphy at o"stra niversity()e)$er o" the 8!o$a! A%enda &ounci! on Advanced Manu"acturin%( ( &!aude &o)tois-- pro"essor o"%eo%raphy at the niversity o" Montrea!( #009( *econd edition o" the tet$oo The 8eo%raphy o"Transport *yste)s(F &hapter 3( o"stra niversity(http://peop!e.ho"stra.edu/%eotrans/en%/ch3en/conc3en/ch3c1en.ht)!5t is %enera!!y advocated that a "or) o" )oda! eIua!ity or )oda! neutra!ity5 shou!d $e part o" pu$!ic po!icy ,here each )ode ,ou!d co)pete

$ased upon its inherent characteristics. *ince di""erent transport )odes are under di""erent 2urisdiction and "undin% )echanis)s( )oda! eIua!ity is

conceptua!!y i)possi$!e as so)e )odes ,i!! a!,ays $e )ore advanta%eous than others. !odal competition is in*luenced by

public policy where one mode could be ad/antaged o/er the others . &his particularly takes place

o/er go/ernment *unding o* in*rastructure and re%u!ation issues. 6or instance( in the nited *tates the 6edera! 8overn)ent

,ou!d "inance =0< o" the costs o" an hi%h,ay pro2ect( !eavin% the state %overn)ent to supp!y the re)ainin% #0<. 6or pu$!ic transit( this share is

?0<( ,hi!e "or passen%er rai! the 6edera! 8overn)ent ,i!! not provide any "undin%. nder such circu)stances( public policy shapes

modal pre*erences. The techno!o%ica! evo!ution in the transport industry ai)s at adaptin% the transport in"rastructures to %ro,in% needs

and reIuire)ents. ?hen a transport mode becomes more ad/antageous than another o/er the same route

or market( a modal shi*t is likely to take place . A modal shi*t in/ol/es the growth in the demand o* a

transport mode at the e:pense o* another( a!thou%h a )oda! shi"t can invo!ve an a$so!ute %ro,th in $oth o" the concerned

)odes. The co)parative advanta%es $ehind a )oda! shi"t can $e in ter)s o" costs( convenience( speed or re!ia$i!ity. 6or passen%ers( this invo!veda transition in )oda! pre"erences as inco)es ,ent up( such as "ro) co!!ective to individua! )odes o" transportation. 6or "rei%ht( this has i)p!ied ashi"t to "aster and )ore "!ei$!e )odes ,hen possi$!e and cost e""ective( na)e!y trucin% and air "rei%ht.

New human transportation in*rastructure hurts the auto industry.

)ethel B Director of Frazier Capital Valuatio; Masters in International Finance and European Business (Stephen, 1 Decemer

!""#, $%he Valuation of &uto ' ecreational Vehicle Dealership )perations,* Chapter !, Frazier Capital,http+---.fraziercapital.comoo/sauto!.pdf

*econd( riva!ry $et,een eistin% co)petitors invo!ves such varia$!es as the nu)$er o" co)petitors( the re!ativestren%th o" the co)petitors( the stren%th o" their co)petitorNs re!ationship ,ith car/truc distri$utors and )anu"acturers( the industry

%ro,th potentia!( the a)ount o" "ied costs needed( service di""erences( and Iua!ity o" cars avai!a$!e. Third( pressure *rom substitute

products can hurt the auto industry. &he auto industry *aces competition not on!y "ro) ,ithin( $ut also*rom other *orms o* transportation such as trains( su$,ays( $icyc!es( )etro transits and others. 'neneeds to "ocus on su$stitute products and the )ini)u) s,itchin% costs "or potentia! custo)ers( and hi%h pro"it earnin% industries ,hich can a""ord to reduce )ar%ins in order to $roaden their )aret into these!!erNs )aret.

+ither they arenIt e**icient or they link

7ilmola 11 '!!i-ea( 7+ench)arin% e""iciency o" pu$!ic passen%er transport in !ar%er cities(7

+ench)arin% 1=.1( roIuest5Ar%ued deve!op)ent steps are "urther supported "ro) the environ)enta! perspective tooG we analy-ed relationships o* di**erent

measures o* pri/ate car use( and "ound interestin% as ,e!! as statistica!!y stron% connection $et,een share o" private car use or

)otoried vehic!e5 and )easured DEA e""iciency. n 6i%ure ? 6i%ure o)itted. *ee Artic!e )a%e.U is sho,n this re!ationship $et,een space usedDEA )ode! s)a!!5 and share o" private car use - !inear re%ression en2oys R# -va!ue o" 3? per cent this re%ression re!ationship ,as a!so "ound to

$e S 0.001 statistica!!y si%ni"icant in re%ression ana!ysis( see Appendi5. As cou!d $e c!ear!y noted( lower the e**iciency o* the

public transportation DEA )ode!( the correspondingly higher use o* pri/ate cars. This re!ationship ho!ds very

nice!y unti! the !eve! o" 0.9 DEA e""iciency - interestin%!y so)e cities havin% "rontier per"or)ance cou!d have hi%h car use or other ,ay around.*i)i!ar statistica!!y si%ni"icant re!ationships ,ere "ound ,ithin $oth !ar%er DEA )ode!s space and servicesG see Appendi "or re%ressionana!ysis5G these a!so repeated si)i!ar causa! re!ationship o" private car use and DEA e""iciency( ,hich ,as havin% stron% ep!anation po,er unti!"rontier e""iciency.

ote: DEAVdata enve!op)ent ana!ysis



ublic transportation and cars are -ero sum

&8A 1$ u$!ic Transport sers Association( 7&o))on r$an Myths A$out Transport(7

http://,,,.ptua.or%.au/)yths/co)pete.sht)!5u$!ic transport advocates and p!anners have spent a %reat dea! o" e""ort ep!ainin% the ,ay in ,hich pu$!ic transport )odes !ie trains(

trams and buses work best when they are combined into a network ( ,ith )odes co)p!e)entin% one another rather

than operatin% as co)petin% "ie"do)s. +ecause o" the net,or e""ects un!eashed( i)prove)ents to $us services actua!!y !ead to )ore patrona%e

on trains as ,e!!( and vice versa. &he road lobby( in the sa)e have-your-cae-and-eat-it-too spirit that %ave us $a!anced transport( hasattempted to apply this same argument to public transport and cars . ts not a$out cars versus pu$!ic transport(

said Roads Minister Ti) a!!as in ove)$er #00;( Iuotin% a!)ost ver$ati) "ro) an RA&B po!icy docu)ent: RA&B does not su$scri$e to thecars versus pu$!ic transport ar%u)ent. e $e!ieve $oth are necessary and co)p!e)entary.... To ensure the various )odes o" transport co)p!e)entrather than co)pete( transport shou!d $e p!anned as an inte%rated syste) rather than a set o" separate )odes. ---Roya! Auto)o$i!e &!u$ o"Bictoria( RA&B Directions #00; eop!e are te)pted to accept this ar%u)ent a!so $ecause ,e are natura!!y dra,n to avoidin% con"!ict. A"ter a!!( i" the or%anisation char%ed ,ith pro)otin% private car use says it doesnt oppose pu$!ic transport( sure!y thats a %ood thin%J *o ,hat i" !ots o" ne,roads %et $ui!t( as !on% as theres so)e support "or pu$!ic transport tooJ Many o" us have seen car dependence enacted as po!icy "or so !on% that,e try to )ae the $est o" a $ad situation( proc!ai)in% !ie the curate in the o!d cartoon5 that actua!!y( parts o" it are ece!!entW The notion o"inte%rated or $a!anced transport is endurin%!y popu!ar "or 2ust this reason. This )yth !oo)ed especia!!y !ar%e in the Eddin%ton East-est eedsAssess)ent o" #00=( the )ost si%ni"icant reco))endations o" ,hich ,ere a H9 $i!!ion road tunne! and an H= $i!!ion rai! tunne! in innerMe!$ourne. ot on!y did Eddin%ton ho!d to the RA&B !ine that the road and rai! tunne!s ,ou!d not co)pete ,ith one another: he actua!!y ur%edthe t,o $e done in co)$ination and that there is a specia! $ene"it to doin% so. do not support - and have not adopted - a road versus rai!approach to transport p!annin%.... nstead o" "avourin% one )ode over another( have !ooed "or the ri%ht co)$ination o" )odes that o""er the $estoptions "or )eetin% Me!$ournes east-,est transport needs.... )y reco))endations.... $e!ieve.... deserve "air consideration as a $a!anced and)easured response to tac!in% so)e o" Me!$ournes )a2or transport di!e))as. ---*ir Rod Eddin%ton( nvestin% in Transport - 'vervie,(

ntroduction( p.>. ith any paca%e( i" you tae pieces o" it and !eave pieces $ehind( then you di)inish the tota!ity o" ,hat the paca%e cou!d do.---*ir Rod Eddin%ton( A+& *tate!ine( 4 Apri! #00= et what does it really mean to claim that roads and public

transport are IcomplementaryIJ t could only mean that building roads actually promotes public

transport use - in the ,ay $etter $uses pro)ote trave! $y train - or at the very !east( that $ui!din% roads has no e""ect on the a)ount o" trave!

$y pu$!ic transport( re!ative to the a)ount o" trave! $y car. +ut o" course this is nonsense: $ui!d a "ree,ay( and peop!e respond $y )ain%

)ore car trips( inc!udin% trips they )ay previous!y have )ade $y pu$!ic transport. This ,e no, "ro) co))on sense( and a!so "ro) theevidence: every "ree,ay $ui!t to date has "i!!ed ,ith ne, tra""ic( o"ten ,ithin 2ust a coup!e o" years( and !ed to a dec!ine in pu$!ic transports shareo" trave!. The dec!ine in pu$!ic transport )ode share ,ith the openin% o" ne, roads has $een seen )ost c!ear!y ,here the road runs para!!e! to aneistin% train !ine. hen the Mu!%rave and *outh Eastern 6ree,ays ,ere !ined in 19==( "i%ures "ro) The Met sho,ed that #0< o" pea

passen%ers on the 8!en aver!ey !ine had shi"ted to usin% their cars ,ithin ,ees o" the road $ein% opened. *o ,hi!e in 19=; there ,ere sevenin$ound pea-hour epresses on the 8!en aver!ey !ine( $y 199? the drop in patrona%e had reduced this nu)$er to t,o( and today there is 2ustone. +ut aside "ro) the !oca!ised e""ects o" particu!ar roads( the shi"t a,ay "ro) pu$!ic transport can a!so $e seen in Me!$ourne-,ide "i%ures. The%raph $e!o,( "ro) the #00; Bictorian +ud%et papers( sho,s pu$!ic transports share o" )otorised trips in Me!$ourne since &ity@in opened in#000. The %raph sho,s )ode share dec!inin% in each o" the net "our years - a dec!ine that ,as on!y arrested ,hen an increase in petro! pricesand &+D e)p!oy)ent "ro) #00? caused train patrona%e to increase si%ni"icant!y. Even then( )ode share in #00> re)ained $e!o, the !eve! in

1999. nterestin%!y( the #00= +ud%et papers indicated that despite "urther stron% patrona%e %ro,th on trains( )ode share had s!ipped a%ain( "ro)=.= to =.> percent o" )otorised trips. The #00= %raph see)s to have tried to o$scure this "act $y an other,ise "air!y point!ess di!ation o" thevertica! ais. *u$seIuent +ud%et papers su%%est that )ode share )ay indeed $e on the rise a%ain( thou%h the )ethod $y ,hich the %overn)entesti)ates overa!! trave! has chan%ed. +y the #010 +ud%et( the "or)er +ru)$y 8overn)ent had %one so "ar as to retrospective!y decide that )odeshare had actua!!y $een increasin% a!! a!on%W Even an un$iased o$server ,ou!d have cause to Iuestion ,hether this is )ore a$out "ace-savin% spinthan honest re-esti)ation( %iven that a!! credi$!e sources "ro) the ear!y #000s inc!udin% *tate and 6edera! transport depart)ents( and the &ensus5c!ear!y sho, pu$!ic transport patrona%e sta%natin% and car use increasin% stron%!y in the period "ro) #000 to #004. A!! o" ,hich is consistent,ith the ori%ina! esti)ates o" dec!inin% )ode share over that period. The "ai!ure to consistent!y increase )ode share ste)s "ro) %overn)ent

po!icy that continues to "avour car trave! and to )ar%ina!ise pu$!ic transport "or anythin% other than pea hour &+D trave!. " the *tate8overn)ent had rea!!y $e!ieved in its ai) "irst proc!ai)ed in #00#5 o" increasin% pu$!ic transport )ode share to #0< $y #0#0( an o$vious ,ayo" de)onstratin% this ,ou!d have $een to re$a!ance transport "undin% a,ay "ro) roads and to,ards pu$!ic transport in"rastructure( such assu$ur$an rai! etensions. et as a recent report "ro) the Austra!ian &onservation 6oundation sho,s( in the decade "ro) #000 to #010 Bictoriaspent three ti)es as )uch on road construction as on non-road transport in"rastructure( and actua!!y spent !ess on the !atter as a proportion o"8ross *tate roduct than any state $ar Tas)ania. And this a!!-too-"a)i!iar disparity has continued( even ,hi!e pu$!ic transport patrona%e soaredto record !eve!s "ro) #00> on,ards. +ecause this patrona%e sur%e occurred in spite o" %overn)ents ne%!ect o" pu$!ic transport( our syste) no,stru%%!es to cope ,ith patrona%e !eve!s that are sti!! )oderate $y the standard o" !ar%e European or East Asian cities. sa%e patterns are a!sohi%h!y uneven: in su$ur$s !ie Doncaster( ,here transport "o!!o,s the co)p!e)entary strate%y o" $ui!din% $i% ne, roads and runnin% $uses on

the)( pu$!ic transport use and car use have increased at a$out the sa)e )odest5 rate( as one )i%ht intuitive!y epect. Xuite p!ain!y( there is

no Inetwork e**ectI between cars and public transport F ,ust a I-ero0sum gameI ( where more tra/el o*

one sort means less o* the other( a!! other thin%s $ein% eIua!. '" course popu!ation %ro,th )eans a!! thin%s are not eIua!( $ut i" ,e

rea!!y p!anned pu$!ic transport ,ith #0< )ode share in )ind( there ,ou!d $e a)p!e roo) to acco))odate additiona! trave!!ers on an epandin%

syste): car use need not have to %ro, at a!!.5 Kreeway0building doesnIt assist public transport not even $uses( as another

pa%e ep!ains5( and good public transport is designed to reduce tra**ic( not 2ust $e a sidesho, to continued %ro,th in car

use.



Any new plan will a**ect the auto industry.

!( Canuary 2$1$(

http://,,,.p)%.co)/*/en/ssuesAndnsi%hts/Artic!esu$!ications/Docu)ents/trans"or)ation-auto)otive-industry.pd"

6or ea)p!e( &oyota is now planning to introduce clean diesel en%ines a"ter havin% !aunched a success"u! hy$rid pro%ra).

&oyota also plans to introduce lithium0ion hybrid /ehicles in so)e )arets throu%h a 2oint venture ,ith their $attery

supp!ier( anasonic. Companies may increasingly engage their suppliers( and so)eti)es their co)petitors( to bring

best0o*0breed technologies to the market at the lowest cost. *ince techno!o%y costs hi%h!y corre!ate ,ith )anu"acturin%

sca!e( a s)a!! nu)$er o" supp!iers ,ith !ar%e "ootprints in a techno!o%y area )ay e)er%e as cost !eaders ,ith a si%ni"icant co)petitive advanta%e.

*o)e o" these supp!iers )ay a!so "or) re%iona! c!usters $ased on %overn)ent incentives and other "avora$!e $usiness conditions. Kederal

*unds introduced by the 8 nited 9 tates go/ernment *or RL in clean technologies and *or re0tooling

e:isting *actories may moti/ate companies to increase their nited *tates *ootprint.&he ne:t G to 1$

years may bring substantial structural changes to the automoti/e industry. A!thou%h a !ar%e portion o" the %!o$a!

auto)otive industry is sti!! in distress( co)panies have to !oo $eyond their short-ter) surviva! cha!!en%es to $eco)e success"u! in the !on% run.A !on%er-ter) strate%y ,i!! invo!ve re$a!ancin% product port"o!ios and sheddin% unpro"ita$!e assets( as ,e!! as investin% in strate%ic %ro,th areas

throu%h a co)p!e ,e$ o" %!o$a! re!ationships. As a resu!t( success"u! companies will increasingly become %!o$a!( asset !i%ht( and

responsi/e to market shi*ts . A c!ear!y de"ined %!o$a! MKA strate%y ,i!! p!ay a do)inant ro!e in separatin% ,inners "ro) !osers(

and eventua!!y shape the *uture o* the global automoti/e industry.

http://www.kpmg.com/US/en/IssuesAndInsights/ArticlesPublications/Documents/transformation-automotive-industry.pdf






79R

No ,ob creation00 built o/erseas

)usiness nsider 12 7&a!i"ornia De)onstrates Eact!y o, To *cre, p i%h *peed Rai!(7 1/10/1#(

http://artic!es.$usinessinsider.co)/#01#-01-10/ne,s/30>1010>O1Ochsra-ca!i"ornia-hi%h-speed-rai!-authority-ace!a-

epress5&a!i"ornia has a history o" "ar)in% out its in"rastructure pro2ects. Ehi$it A: The *an 6rancisco-'a!and +ay +rid%e. t is years $ehind schedu!e.The $ud%et "or the eastern span has $a!!ooned "ro) H1.3 $i!!ion to H>.3 $i!!ion. And the !and)ar ?#? "t. to,er o" the 7se!"-anchored suspension7

$rid%e ,as "a$ricated in ... &hina. 6or )ore on co!!apsed $rid%es and $ui!din%s in &hina pics5( the hi%h-speed rai! accident( and the econo)ics o"

havin% a $i% part o" the +ay +rid%e $ui!t there( read.... 'ur &hinese +ay +rid%e. &he high0speed rail system will ha/e even )ore

*oreign content. +ui!din% the civi! ,ors and !ayin% the trac ,i!! $e done $y !oca! ,orers. +ut design and engineering will

be done o/erseas by companies with e:pertise in the "ie!d. &rains will be manu*actured o/erseas as well (

thou%h co)panies )i%ht pro)ise to asse)$!e the) in the .*. Mere cru)$s. .*. Tapayers ,i!! "und the pro2ectQas they "und hi%h,ay

construction. +ut part o" the *unds will go to *oreign companies and ad/ance their technologies. i%h-speed rai! is

a ,or!d,ide $usiness( and the !eaders have $eco)e eport po,erhouses. Another sector that American industry

abandoned.

79R pro,ects o/er0run the allocated costs and steal employment *rom auto0industry

icone 11 +rian( 7i%h *peed Rai!: ard!y an nvest)ent in 6uture(7 9/=/11( http://hi%h-speedtrainta!.$!o%spot.co)/#011/09/another-s!ant-on-poorer-peop!e-havin%.ht)!5i%h speed rai! proponents are "ond o" toutin% such pro2ects as invest)ents in our "uture.F o,ever( the ter) invest)entF is )is!eadin%.nvest)ent i)p!ies that the party doin% the investin% ,i!! a!so su""er the conseIuences i" an endeavor !oses )oney. +ut ,hen hi%h speed rai!

pro2ects !ose )oney Q as they do a!)ost universa!!y Q the tapayer is on the hoo( not the po!iticians ,ho vote in "avor o" the). Even

ad/ocates o* high speed rail admit that such pro,ects almost ne/er co/er their operating costs . Yai

+arrZn de An%oiti( director o" hi%h-speed rai! at the nternationa! nion o" Rai!,ays in aris( ad)its that ,hi!e he "avors such pro2ects( they arenot a pro"ita$!e $usiness.F e %oes on to point out that on!y t,o hi%h speed rai! routes in the ,or!d actua!!y $rea even [ one "ro) aris to @yon

and one "ro) Toyo to 'saa. '" course( rai! proponents "ai! to )ention the 11 other countries that consistently reDuire

large ta:payer subsidies to keep their lines operational. 6urther)ore( the 6rench and Capanese syste)s c!ai)

pro"ita$i!ity $ased on "!a,ed accountin% princip!es. The 6rench accountin% syste) treats tapayer su$sidies "or the hi%h speed rai! asco))ercia! revenues.7 This )aes the 6rench pro%ra)Ns H1.;? $i!!ion in pro"its )uch !ess i)pressive [ especia!!y considerin% that( accordin% toa #00= study $y A)tra( 6rench tapayers spend c!ose to H10 $i!!ion per year su$sidiin% the hi%h speed rai! syste). The Capanese syste) has aneven ,orse record. ithin t,o decades o" $ein% esta$!ished( CapanNs hi%h speed rai! syste) had accu)u!ated such )assive a)ounts o" de$t that

the entire syste) had to $e privatied. Capanese tapayers ,ere then stuc ,ith the syste)Ns H#=0 $i!!ion in de$t( ,hich they are sti!! payin% o""today. " Capan and 6rance are the ,or!dNs t,o $est ea)p!es o" hi%h speed rai! success( then perhaps ,e shou!d reconsider. Even &hina( a nationthat is no stran%er to in"rastructure invest)ent( is shyin% a,ay "ro) hi%h speed rai!. n #010( the &hinese Acade)y o" *ciences ur%ed the%overn)ent to reconsider "urther invest)ent in hi%h-speed rai!( due to the current syste)Ns tre)endous de$ts. Accordin% to \hao Cian( a pro"essor at Ciaoton% niversity in +ei2in%( hi%h speed rai! is a $i% !oss ] the operation cost is too hi%h.F &!ai)s that invest)ent in hi%h-speed rai! ,i!!create ne, 2o$s are du$ious. The &a!i"ornia i%h *peed Rai! Authority &*RA5 predicts that 9=< o" its "uture riders are "o!s that ,ou!d

other,ise drive or "!y to their destinations. This )eans that nearly all o* the employment created by such high speed

rail pro,ects will simply be re0allocated *rom the airline and automobile industry . This )ay chan%e the

co)position o" e)p!oy)ent in the .*. econo)y( $ut not the !eve! Q ,hi!e sti!! %ivin% the appearance o" 2o$ creation.

79R trades o** with cars

eterman et al $B --&oordinator Ana!yst in Transportation o!icy David Randa!! eter)an(

&oordinator Ana!yst in Transportation o!icy Cohn 6ritte!!i *pecia!ist in Transportation o!icy i!!ia) C.Ma!!ett *pecia!ist in Transportation o!icy( Dece)$er =( #009( &on%ressiona! Research *ervice( i%h

*peed Rai! *R5 in the *F A5n heavi!y trave!ed and con%ested corridors( proponents contend that *R ,i!! re!ieve hi%h,ay and air tra""ic con%estion( and( i" on a separateri%ht-o"-,ay( )ay a!so $ene"it "rei%ht rai! and co))uter rai! )ove)ents ,here such services share trac ,ith eistin% intercity passen%er rai!

service.34 +y a!!eviatin% con%estion( the notion is that 79R potentially reduces the need to pay *or capacity

e:pansions in other modes. 'n the Iuestion o" hi%h,ay con%estion re!ie"( )any studies esti)ate that *R ,i!! have !itt!e positive

e""ect $ecause )ost hi%h,ay tra""ic is !oca! and the diversion o" intercity trips "ro) hi%h,ay to rai! ,i!! $e s)a!!. n a study o" *R pu$!ished in199;( the 6edera! Rai!road Ad)inistration 6RA5 esti)ated that in )ost cases rai! i)prove)ents ,ou!d divert on!y 3->< o" intercity auto)o$i!etrips. 6RA noted that corridors ,ith short avera%e trip !en%ths( those under 1?0 )i!es( sho,ed the !o,est diversion rates.3? The .*. Depart)ento" TransportationNs nspector 8enera! 85 "ound )uch the sa)e thin% in a )ore recent ana!ysis o" *R in the ortheast &orridor. The 8ea)ined t,o scenarios: *cenario 1 invo!ved cuttin% rai! trip ti)es "ro) +oston to e, or "ro) 3 1^# hours to 3 hours and "ro) e, or to

ashin%ton "ro) 3 hours to # 1^#G *cenario # invo!ved cuttin% trip ti)es on $oth !e%s $y another 1^# hour over scenario 1 . n both



scenarios( the *ound that the impro/ements reduced automobile ridership a!on% the E& $y !ess than

1<.3> The 8 noted auto)o$i!e trave! di""ers "ro) air or rai! trave! in that it %enera!!y invo!ves door-to-door service( o""ers %reater "!ei$i!ity inti)e o" departure( and does not reIuire trave!ers to share space ,ith stran%ers. &onseIuent!y( rai! trave! )ust $e etre)e!y co)petitive in otherdi)ensions( such as speed or cost( to attract auto)o$i!e trave!ers.F3; !anners o" a hi%h speed rai! !in in 6!orida $et,een 'r!ando and Ta)pa( adistance o" a$out =4 )i!es( esti)ated that it ,ou!d shi"t 11< o" those drivin% $et,een the t,o cities to the train( as ,e!! as 9< o" those drivin%"ro) @ae!and to either 'r!ando ?4 )i!es5 or Ta)pa 33 )i!es5. o,ever( $ecause )ost o" the tra""ic on the )ain hi%h,ay !inin% the t,o cities(

-4( is not trave!!in% $et,een these cities( it ,as esti)ated that *R ,ou!d reduce tra""ic on the $usiest sections o" -4 $y !ess than #<.3= &he

*inal en/ironmental impact statement *or the pro,ect states that the reduction in the number o*/ehicles resulting *rom the 79R system ,ou!d not $e su""icient to si%ni"icant!y i)prove the @'* !eve! o" serviceU on -4( as

)any se%)ents o" the road,ay ,ou!d sti!! $e over capacity.F39 The esti)ated cost o" the *R !ine ,as H#.0 $i!!ion to H#.? $i!!ion(40 or H##)i!!ion to H#; )i!!ion per )i!e.



Railroads

Rail hurts auto sectorF shi*ts ,obs o/erseas

ollin and )aker $B Ro$ert( Dean( 7 u$!ic nvest)ent( ndustria! o!icy and .*. Econo)icRene,a!(7 Dece)$er #009( &enter "or Econo)ic and o!icy Research(http://,,,.peri.u)ass.edu/"i!ead)in/pd"/,orin%Opapers/,orin%OpapersO#01-#?0/#11.pd"5At the sa)e ti)e( particu!ar!y ,ithin a shorter-run "ra)e,or there are problems with relying too hea/ily on rail

systems as the pri)ary "ocus o" pu$!ic transportation invest)ents. The )ost evident shorter-ter) concern is that these systems

reDuire years o* planning and spending $e"ore they co)e on !ine and co))unities en2oy the $ene"its. +ut in addition( the

8nited 9tates( at present( has /irtually no capacity to build mass transit systems and /ehicles . 9ubway

cars used in the 8.9. are supplied by Krench( erman and Eapanese companies . 'ther inds o" )ass transit

vehic!es are $ui!t either in *outh orea or 8er)any. As Conathan 6e!d)an #0095 reports( the .*. ,as once a techno!o%ica! !eader in this "ie!d(and cou!d $eco)e so $ut this ,i!! tae years o" steady support in ter)s o" research and deve!op)ent as ,e!! as pu$!ic procure)ent contracts.

6ina!!y( to the e:tent that o/erall transportation *unding is shi*ted to rail systems ( this would represent

an additional blow to the 8.9. auto industry.



)ikes

Kunding *or bicycle in*rastructure directly trades o** with the auto industry

@arry Cohen 6e$ruary #nd #012 &reeps and ,eirdos: The auto industry a%enda "or eepin% you on "our,hee!s http://,,,.nationo"chan%e.or%/creeps-and-,eirdos-auto-industry-a%enda-eepin%-you-"our-,hee!s-13#=19339;

+ut( the auto industrys pro*its depend on making sure that cars remain the standard mode

o* transportation [ and that car co)panies grow their customer base( not lose them to bicycles.

Auto co)panies are "ue!ed $y pro"its( and the auto industry spent o/er MG million !ast year a!one

on lobbying &on%ress and other "edera! a%encies in order to maintain a monopoly on our road,ays.

The auto industry )aes )oney $y ensurin% that the pu$!ic va!ues drivin% and that roads are $ui!t "or carsa!one [ even i" this )eans %reater de)and "or "ossi! "ue!( increased environ)enta! de%radation( "e,eropportunities "or physica! activity( and )ore road-re!ated in2uries.



!ass &ransit

!a,or in/estment in public transit kills the auto industry

Kranchise irect #0$B Auto)otive 6ranchises 6ranchise Direct conducted an intensive study o" theauto)otive "ranchise industry $y ea)inin% the 6DDNs o" 30 $usinesses. The study sho,s that despite theende)ic pro$!e)s in the car industry( auto)otive "ranchises re)ain a so!id invest)ent.http://,,,."ranchisedirect.co)/auto)otive"ranchises/auto)otiveindustrytrends$usinessreportii/;/#49

A)erican co))unities and su$ur$s are desi%ned very )uch around the car. !any cities lack any reliable

public transport. ?ithout ma,or in/estment in mass transit in*rastructure it will not pose a

ma,or threat to car use. A)ericans ,i!! continue to re!y heavi!y on their cars "or the "oreseea$!e "uture.

A!ready in #009( the rate o" dec!ine o" )i!es driven has s!o,ed )odest!y. 8aso!ine prices have dropped to around H#a %a!!on. As !on% as %aso!ine prices re)ain sta$!e in #009( auto "ranchises ,i!! $ene"it as consu)ers have )oredisposa$!e inco)e to spend on de"erred car )aintenance and repairs.



mpacts



+conomy

Auto ndustry plays a crucial role in the economy

?aldron 12 Travis a!dron( March #3( #01# thin pro%ress( sta"" ,riter( http://thinpro%ress.or%/econo)y/#01#/0?/#3/4=90#4/auto-

industry-add-2o$s/J)o$i!eVnc Auto ndustry Adds Thousands '" Co$s To Meet 8ro,in% De)and( rovin% Auto RescueNs *uccess et A%ainF

A5&he automobile industry has been a consistent bright spot in the American economy o/er the last

se/eral months( as auto)aers have added 2o$s to )eet %ro,in% de)and. And ne,s "ro) the industry is on!y %ettin% $etter( as ne,

esti)ates epect auto)aers to se!! 14.3 )i!!ion cars in the nited *tates in #01# Q 1.? )i!!ion )orethan they so!d !ast year. 6actories "or $oth "orei%n and do)estic auto)aers are no, ,orin% at )ai)u)capacityF and the industry is addin% shi"ts and 2o$s to eep up ,ith that risin% de)and( the *A Today reports: *o)e p!ants areaddin% third ,or shi"ts. 'thers are pi!in% on ,orer overti)e and si-day ,ees. And 6ord Motor and &hrys!er 8roup

are cuttin% out or reducin% the annua! t,o-,ee Cu!y shutdo,n at severa! p!ants this su))er to add thousands o" vehic!es to their output. ehave )any p!ants ,orin% at )ai)u) capacity no,(F says 6ord spoes,o)an Marcey Evans. eNre $ui!din% as )any cars5 as ,e can.F

&hrys!er and 8enera! Motors( the )a2or $ene"iciaries o" the auto rescue( have $oth reported their $est pro"its in )ore than a decade( and $oth ,ere a!ready p!annin% to add 2o$s this year. ith "actories no, stru%%!in%

to )eet de)and( $oth "orei%n and do)estic auto co)panies are p!annin% to add even )ore 2o$s Q and( as the &enter "or A)erican ro%ressN

Ada) ersh and Cane 6arre!! noted in Apri!( the industry has added more than 13B($$$ ,obs in the last three years.

&he strength o* the auto industry is yet another sign that letting it *ail would ha/e been a ma,ormistake. Not only would it ha/e cost more than a million ,obs at a time when the economy was

struggling( it would ha/e pre/ented the current growth that is helping both the industry and the

American economy reco/er.

+conomic growth creates a stable political( democratic( and open *oundation to pre/ent the

risk o* con*lict. <ur e/idence cites empirics

elong ' C +rad"o!d De!on%( March 1;( arvard Ma%aine( http://harvard)a%aine.co)/#00>/01/%ro,th-is-%ood.ht)! ( 8ro,th is 8oodF(

**5

+en2a)in M. 6ried)an N>>( C" N;1( h.D. N;1( Maier pro"essor o" po!itica! econo)y( no, "i!!s in this %ap: he )aes a po,er"u! ar%u)ent thatQ

politically and sociologically modern society is a bicycle ( with economic growth being the *orward

momentum that keeps the wheels spinning. As !on% as the ,hee!s o" a $icyc!e are spinnin% rapid!y( it is a very sta$!e vehic!e

indeed. +ut( he ar%ues( when the wheels stop Qeven as the resu!t o" econo)ic sta%nation( rather than a do,nturn or a depressionQ

political democracy( indi/idual liberty( and social tolerance are then greatly at risk even in countries ,here

the a$so!ute !eve! o" )ateria! prosperity re)ains hi%h. &onsider 2ust one o" his ea)p!esQa ca!cu!ation he pics up "ro) his co!!ea%ue A!$erto

A!esina( Ropes pro"essor o" po!itica! econo)y( and others: in an a/erage country in the late twentieth century( rea! per

capita income is *alling by 1. percent in the year in which a military coup occurs ; it is rising by 1.

percent in the year in which there is a legitimate constitutional trans*er o* political power ; and it is

rising by 2.H percent in the year in which no ma,or trans*er o* political power takes place. * you

want a!! inds o" non-econo)ic %ood thin%s( 6ried)an saysQ!ie openness o* opportunity( tolerance( economic and

social mobility( *airness( and democracy Qrapid economic growth makes it much( much easier to get

themG and econo)ic sta%nation )aes %ettin% and )aintainin% the) near!y i)possi$!e. The $oo is a de!i%ht to read( pro$in% re!ative!y deep!y

into individua! topics and yet )ana%in% to hurry a!on% "ro) discussions o" po!itica! order in A"rica to econo)ic %ro,th and the environ)ent( to%ro,th and eIua!ity( to the En!i%hten)ent thiners o" ei%hteenth-century Europe( to the t,entieth-century histories o" the )a2or Europeancountries( to a host o" other su$2ects. et each topicNs re!ationship to the centra! thesis o" the $oo is c!ear: the su$chapters sho, the virtuous

circ!es $y ,hich econo)ic %ro,th and sociopo!itica! pro%ress and !i$erty rein"orce each other5 and the vicious circ!es $y ,hich sta%nation $reeds vio!ence and dictatorship5 in action. ?here growth is rapid( the mo/ement toward democracy is easier

and societies become *reer and more tolerant. And societies that are *ree and more tolerant a!$eit not

necessari!y de)ocratic5 *ind it easier to attain rapid economic growth. Kriedman is not a*raid to charge

head0on at the ma,or t,entieth-century countere:ample to his thesisF the reat epression in the 8nited

9tates. +lsewhere in the ,or!d( that catastrophe o**ers no challenge to his point o* /iew. Rising

unemployment and declining incomes in Eapan in the 1B3$s certain!y played a role in the

assassinations and silent coups by which that country went *rom a *unctioning constitutional

monarchy ,ith representative institutions in 1930 to a *ascist military dictatorship in 1B$ Qa dictatorship that( tied do,n in a

http://harvardmagazine.com/2006/01/growth-is-good.html





Iua%)ire o" a !and ,ar in Asia as a resu!t o" its attac on &hina( thou%ht it ,as a %ood idea to attac( and thus add to its ene)ies( the t,o superpo,ers o" +ritain andthe nited *tates. n ,estern Europe the ca!cu!us is eIua!!y si)p!e: no 8reat Depression( no it!er. The saddest $oo on )y she!" is a 19#= vo!u)e ca!!ed Repu$!ican8er)any: An Econo)ic and o!itica! *urvey( the thesis o" ,hich is that a"ter a decade o" post-or!d ar po!itica! tur)oi!( 8er)any had "ina!!y $eco)e a sta$!e(!e%iti)ate( de)ocratic repu$!ic. And on!y the "act that the 8reat Depression ca)e and o""ered it!er his opportunity )ade it ,ron%.

Auto industry is key to the economy @ multiplier e**ect

A( 12 4/3/1#( http://,,,.ohio.co)/$usiness/u-s-auto)aers-post-$est-)onth!y-sa!es-since-#00;-1.#911?;( CD5

" car sa!es stay at the sa)e rate as March( they ,ou!d end the year at 14.4 )i!!ion( up "ro) 1#.= )i!!ionin #011. hi!e thatNs sti!! $e!o, the 1; )i!!ion o" the $oo)in% )id-#000s( itNs "ar hi%her than the industryNs do,nturn in #009( ,hen 10.>

)i!!ion vehic!es ,ere so!d. Cesse Topra( vice president o" industry ana!ysis at car $uyin% site True&ar.co)( epects continued stron% sa!es this

year( thans to co)pe!!in% ne, products( i)prove)ents in consu)er con"idence and the stoc )aret and !o, interest rates. The %oodne,s is that the recovery has !e%s(F he said. e epects tota! sa!es o" 14.? )i!!ion in #01#. That ,ou!d $e a"aster pace than )any ,ere predictin% at the start o" the year( and it $ui!ds on a stron% per"or)ance inCanuary and 6e$ruary. As recent!y as 'cto$er( C.D. o,er and Associates !o,ered its #01# "orecast "ro) 14.1 )i!!ion vehic!es to 13.=

)i!!ion $ecause o" hi%h %as prices and continuin% econo)ic uncertainty. &he auto sectors reco/ery is helping the entire

economy . =Auto is important because it creates so many other ,obs (> said *un% on *ohn( an econo)ics pro"essor at &a!i"ornia *tate niversity. Thin a$out the thin%s that %o into an auto: %!ass( teti!es( ru$$er . ThereNs a !ot o""inancin% activity. ?e are talking about a /ery signi*icant portion o* ,ob creation.F 9ohn said a lot o*

pent0up demand remains in the 8.9.( *rom people who couldnt a**ord cars during the recession to

those ,ho ,aited "or Capanese inventories to i)prove a"ter !ast MarchNs earthIuae. The avera%e a%e o" a vehic!e on .*. roadshas reached 10.= years( and )any need to $e rep!aced. 8MNs .*. sa!es chie" ( Don Cohnson( says pent-upde)and ,i!! continue to "ue! sa!es ,e!! into net year . *ohn said hi%h %as prices are actua!!y he!pin% persuade peop!e to trade in o!der( !ess-e""icient vehic!es. i%h car prices donNt see) to $e ho!din% $uyers $ac( either. True&ar said the avera%e vehic!e price reached a ne, record o" H30(;4= in March( around H#(000 )ore than the sa)e )onth !ast

year. Even thou%h drivers are s,itchin% to s)a!!er cars( theyNre appointin% the) ,ith epensive !uuries such as !eather seats and navi%ationsyste)s( Topra said.

+conomic decline heightens the risk o* global con*lict multiple scenarios.

)urrows and 7arris B QMathe, C. +urro,s( counse!or in the ationa! nte!!i%ence &ounci!( principa!

dra"ter o" Global Trends 2025: A Transformed World Qan unc!assi"ied report $y the & pu$!ished every"our years that pro2ects trends over a 1?-year period( has served in the &entra! nte!!i%ence A%ency since

19=>( ho!ds a h.D. in European istory "ro) &a)$rid%e niversity( and Cenni"er arris( Me)$er o" the@on% Ran%e Ana!ysis nit at the ationa! nte!!i%ence &ounci!( ho!ds an M.hi!. in nternationa!Re!ations "ro) '"ord niversity and a C.D. "ro) a!e niversity( #009 Revisitin% the 6uture:8eopo!itica! E""ects o" the 6inancia! &risis(F The Washington Quarterly( Bo!u)e 3#( ssue #( Apri!(Avai!a$!e 'n!ine at http://,,,.t,I.co)/09apri!/docs/09aprO+urro,s.pd"( Accessed 0=-##-#011( p. 3?-3;5'" course( the report enco)passes )ore than econo)ics and indeed $e!ieves the "uture is !ie!y to $e the resu!t o" a nu)$er o" intersectin% andinter!ocin% "orces. ith so )any possi$!e per)utations o" outco)es( each ,ith a)p!e end pa%e 3?U opportunity "or unintended conseIuences(there is a %ro,in% sense o" insecurity.

Even so( history )ay $e )ore instructive than ever. ?hile we continue to belie/e that the reat epression is not

likely to be repeated( the lessons to $e dra,n *rom that period include the harm*ul e**ects on *ledgling

democracies and multiethnic societies thin &entra! Europe in 19#0s and 1930s5 and on the sustaina$i!ity o" )u!ti!atera!

institutions thin @ea%ue o" ations in the sa)e period5.&here is no reason to think that this would not be true in

the twenty0*irst as )uch as in the t,entieth century. 6or that reason( the ways in which the potential *or greater

con*lict could grow would seem to be e/en more apt in a constantly /olatile economic en/ironment

as they would be i* change would be steadier.

n surveyin% those riss( the report stressed the !ie!ihood that terroris) and nonpro!i"eration ,i!! re)ain priorities even as resource issues )ove

up on the internationa! a%enda. &errorisms appeal will decline i* economic growth continues in the Midd!e East and

youth une)p!oy)ent is reduced. 6or those terrorist %roups that re)ain active in #0#?( ho,ever( the di""usion o" techno!o%ies and scienti"icno,!ed%e ,i!! p!ace so)e o" the ,or!dNs )ost dan%erous capa$i!ities ,ithin their reach. Terrorist %roups in #0#? ,i!! !ie!y $e a co)$ination o"descendants o" !on% esta$!ished %roupsQinheritin% or%aniationa! structures( co))and and contro! processes( and trainin% procedures necessary



to conduct sophisticated attacsQand ne,!y e)er%ent co!!ections o" the an%ry and disen"ranchised that $eco)e se!"-radica!ied( particu!ar!y inthe a$sence o" econo)ic out!ets that ,ou!d $eco)e narro,er in an econo)ic do,nturn.

&he most dangerous casualty o* any economically0induced drawdown o* 8.9. military presence

would a!)ost certain!y be the !iddle +ast. A!thou%h ranNs acIuisition o" nuc!ear ,eapons is not inevita$!e( ,orries a$out a nuc!ear-

ar)ed ran cou!d !ead states in the re%ion to deve!op ne, security arran%e)ents ,ith eterna! po,ers( acIuire additiona! ,eapons( and consider pursuin% their o,n nuc!ear a)$itions. t is not c!ear that the type o" sta$!e deterrent re!ationship that eisted $et,een the %reat po,ers "or )ost o"

the &o!d ar ,ou!d e)er%e natura!!y in the Midd!e East ,ith a nuc!ear ran. +pisodes o* low intensity con*lict and

terrorism taking place under a nuclear umbrella could lead to an unintended escalation and

broader con*lic t i" c!ear red !ines $et,een those states invo!ved are not ,e!! esta$!ished. The c!ose proi)ity o" potentia! nuc!ear riva!s

co)$ined ,ith underdeve!oped survei!!ance capa$i!ities and )o$i!e dua!-capa$!e ranian )issi!e syste)s a!so ,i!! produce inherent di""icu!ties inachievin% re!ia$!e indications and ,arnin% o" an i)pendin% nuc!ear attac. The !ac o" strate%ic depth in nei%h$orin% states !ie srae!( short,arnin% and )issi!e "!i%ht ti)es( and uncertainty o" ranian intentions )ay p!ace )ore "ocus on pree)ption rather than de"ense( potentia!!y!eadin% to esca!atin% crises. end pa%e 3>U

Types o" con*lict that the ,or!d continues to eperience( such as o/er resources( could reemerge( particu!ar!y i" protectionis)

%ro,s and there is a resort to neo-)ercanti!ist practices. erceptions o* renewed energy scarcity will dri/e countries

to take actions to assure their *uture access to ener%y supp!ies. n the ,orst case( this could result in interstate

con*licts i" %overn)ent !eaders dee) assured access to ener%y resources( "or ea)p!e( to $e essentia! "or )aintainin% do)estic sta$i!ity and

the surviva! o" their re%i)e. +/en actions short o* war( ho,ever( will ha/e important geopolitical implications.

Mariti)e security concerns are providin% a rationa!e "or nava! $ui!dups and )oderniation e""orts( such as &hinaNs and ndiaNs deve!op)ent o" $!ue ,ater nava! capa$i!ities. " the "isca! sti)u!us "ocus "or these countries indeed turns in,ard( one o" the )ost o$vious "undin% tar%ets )ay $e)i!itary. +ui!dup o" re%iona! nava! capa$i!ities cou!d !ead to increased tensions( riva!ries( and counter$a!ancin% )oves( $ut it a!so ,i!! createopportunities "or )u!tinationa! cooperation in protectin% critica! sea !anes. ith ,ater a!so $eco)in% scarcer in Asia and the Midd!e East(

cooperation to )ana%e chan%in% ,ater resources is likely to be increasingly di**icult $oth ,ithin and $et,een states in a

more dog0eat0dog world .



7egemony

Oital to inno/ation and hegemony

Clark $ 00 retired Ar)y %enera! and "or)er supre)e a!!ied co))ander o" AT'( is a senior "e!!o, atthe +ur!e &enter "or nternationa! Re!ations at the niversity o" &a!i"ornia at @os An%e!es es!ey .&!ar( 7hatNs 8ood "or 8.M. s 8ood "or the Ar)y(7 e, or Ti)es( 11/1;/0=(http://,,,.nyti)es.co)/#00=/11/1>/opinion/1>c!ar.ht)!JOrV45hen resident D,i%ht Eisenho,er o$served that A)ericaNs %reatest stren%th ,asnNt its )i!itary( $ut its econo)y( he )ust have had

companies like eneral !otors and Kord in )ind. *ittin% atop a vast pyra)id o" too! )aers( stee! producers( "a$ricators and

co)ponent )anu"acturers( these co)panies not only produced the tanks and trucks that helped win ?orld ?ar

( but also lent their technology to aircra*t and ship manu*acturing. The nited *tates tru!y $eca)e the arsena! o"

de)ocracy. Durin% the 19?0s( advances in aviation( )issi!es( sate!!ites and e!ectronics )ade Detroit see) a !itt!e o!d-"ashioned in dea!in% ,ith thethreat o" the *oviet nion. The Ar)yNs reIuests "or ne, trucs and other $asic transportation usua!!y ca)e out a !oser in $ud%et $att!es a%ainst)issi!e techno!o%y and ne, )odi"ications "or the !atest supersonic 2et "i%hter. ot on!y ,ere airp!anes "ar seier $ut they a!so counted as part o"our )i!itary tooth(F ,hi!e )uch o" the !and "orcesN needs ,ere tai!.F And in those days( )ore teeth( !ess tai!F had $eco)e a ey concept in

)i!itary spendin%. +ut in 1991( the ersian ul* war demonstrated the awesome utility o* American land

power( and the u)vee and its civi!ian version( the u))er5 $eca)e a star. @ie,ise( the u$iIuitous ho)e)ade $o)$s o" the current raI

insur%ency have !ed to the deve!op)ent o" inno/ati/e armor0protected wheeled /ehicles *or American *orces( as

,e!! as i)prove)ents in our "!eets o" u)vees( tanks( armored *ighting /ehicles( trucks and cargo carriers. n a !itt!e)ore than a year( the Ar)y has procured and "ie!ded in raI )ore than a thousand so-ca!!ed )ine-resistant a)$ush-protected vehic!es. &he

li/es o* hundreds o* soldiers and marines ha/e been sa/ed( and their tass )ade )ore achieva$!e( by the e**orts

o* the American automoti/e industry. And un!ie in or!d ar ( A)erica didnNt have to divert )uch civi!ian capacity to )eet

these )i!itary needs. ?ithout a /igorous automoti/e secto r( those needs could not ha/e been Duickly met.

!ore challenges lie ahead *or our military( and to meet them we need a strong industrial base . 6or

years the )i!itary has sou%ht $etter sources o" e!ectric po,er in its vehic!es Q necessary to a!!o, troops to )onitor their radios ,ith diese!en%ines o""( to support increasin%!y hi%h-po,ered co))unications techno!o%y( and eventua!!y to support e!ectric propu!sion and innovativear)a)ents !ie directed-ener%y ,eapons. n su)( this %reater use o" e!ectricity ,i!! increase co)$at po,er ,hi!e reducin% our "ootprint. Muchresearch and deve!op)ent spendin% has %one into these pro%ra)s over the years( $ut nothin% on the )anu"acturin% sca!e ,e rea!!y need. o,(

thou%h( as Detroit )oves to p!u%-in hy$rids and e!ectric-drive techno!o%y( the sca!e pro$!e) can $e re)edied. Automakers are

de/eloping inno/ati/e electric motors( )any ,ith per)anent )a%net techno!o%y( that will ha/e immediate

military use. And only the auto industry ( with its /ast purchasing power( is able to establish a

domestic ad/anced battery industry. @ie,ise( domestic *uel cell production Q ,hich ,i!! undou$ted!y have )anycritica! )i!itary app!ications Q depends on a /ibrant car industry. To $e sure( the pu$!ic shou!d de)and trans"or)ation and ne,

standards in the auto industry $e"ore payin% to eep it a!ive. And ,e shou!d insist that DetroitNs %oa!s inc!ude puttin% A)erica in "irst p!ace inhy$rid and e!ectric auto)otive techno!o%y( reducin% the e)issions o" the countryNs transportation "!eet( and stren%thenin% our co)petitiveness

a$road. This shou!d $e no %ivea,ay. nstead( it is a historic opportunity to get it right in etroit *or the good o*

the country. +ut A)ericans )ust $ear in )ind that any "edera! assistance p!an ,ou!d not $e 2ust an econo)ic )easure. &his is(

*undamentally( about national security.

Auto industry key to heg00 inno/ation and spillo/er

Ronis $' *TATEMET '6 DR. *E@A R'*( DRE&T'R M+A/M* R'8RAM*( A@*

&'@@E8EG B&E RE*DET( AT'A@ DE6E*E BER*T 6'DAT'( TR'(M&8A &AN* MA&T ' TE .*. AT' AD AT' ART* D*TRE* EAR8+E6'RE TE .*.&A E&''M& AD *E&RT REBE &'MM**' 'E DRED

T &'8RE** *E&'D *E**'( Cu!y 1;( #00>http://,,,.uscc.%ov/hearin%s/#00>hearin%s/transcripts/2u!yO1;/0>O0;O1;Otrans.pd"5ou ,i!! hear "ro) )y co!!ea%ues in the Depart)ent o" De"ense ri%ht here ,ho are eperts in the Di)inishin% Manu"acturin% *ources andMateria! *horta%es. or DM*M*. co))unity. Mission capa$!e syste)s and readiness are put at ris ,hen DM*M* issues are !e"t unreso!ved.

hat isnt understood is the rea!ity that the auto industry a""ects DM*M* $ecause the industrial in*rastructure that

supports the epartment o* e*ense is shared by the auto industry. ?hen a tier supplier to the auto

industry goes under . ,hether it is a )achine too! co)pany or in )icroe!ectronics. it reduces oIs ability to *unction

,hether ,e say so or not. thin ,e )i%ht as ,e!! say so. ?hen go/ernment RKD in/estment in an industry

deteriorates. itIs only a matter o* time be*ore an industry is in trouble. !anu*acturing RKD $y the "edera!



%overn)ent has almost disappeared. oun% peop!e no !on%er vie, ,orin% in )anu"acturin% as a possi$!e career so ?eIre losing

our ability to train the ne:t generation o* scientists and engineer s. ?eIre losing critical to de"ense

industries "ro) ship$ui!din% to )achine too!s. hi%h per"or)ance ep!osives and ep!osive co)ponents. cartrid%e and prope!!ant actuated

devices. ,e!din% and even the nuc!ear industry. A!! o" these industries share the bottom o* the base with the auto

industry. and that is ,hat has become a national security issue . ?e need to maintain a capability to be

globally competiti/e in $oth product and process innovation. ?e must regain our manu*acturing prowess and

leadership. e need to reinvi%orate the Manu"acturin% Etension artnership ro%ra) at *T. e need to prioritie those techno!o%ies that

are critica! to re%ainin% and then )aintainin% !eadership and co)petitive advanta%e in the overa!! industria! $ase so &hina does not $eco)e the

,or!ds !eader in techno!o%ies ,e need to $e a superpo,er. China is rapidly becoming the manu*acturing capital o*

the world. 6or ea)p!e. &hinese o""icia!s have very pu$!ic!y stated that they ,ant to $eco)e the "oundry capita! o" the ,or!d and have a

,or!d,ide )onopo!y on cast parts. They have a p!an to ,in. And ,e dont.

lobal con*lict

halil-ad 11 [ 6or)er * a)$assador( "or)er ro"essor _ &o!u)$ia\a!)ay ha!i!ad( hD( nited *tates a)$assador to A"%hanistan( raI( and the nited ations durin%

the presidency o" 8eor%e . +ush and the director o" po!icy p!annin% at the De"ense Depart)ent "ro)

1990 to 199# #/=/11( ationa! Revie,( The Econo)y and ationa! *ecurityG " ,e donNt %et our

econo)ic house in order( ,e ris a ne, era o" )u!ti-po!arity(F

http://,,,.nationa!revie,.co)/artic!es/#?90#4/econo)y-and-nationa!-security-a!)ay-ha!i!ad5?e *ace this domestic challenge while other ma,or powers are e:periencing rapid economic growth .

Even thou%h countries such as &hina( ndia( and +rai! have pro"ound po!itica!( socia!( de)o%raphic( and econo)ic pro$!e)s( their econo)ies

are %ro,in% "aster than ours( and this cou!d a!ter the %!o$a! distri$ution o" po,er. These trends cou!d in the !on% ter) produce a )u!ti-po!ar

,or!d. " .*. po!icy)aers "ai! to act and other po,ers continue to %ro,( it is not a Iuestion o" ,hether $ut ,hen a ne, internationa! order ,i!!

e)er%e. &he closing o* the gap between the 8nited 9tates and its ri/als could intensi*y geopolitical

competition among ma,or powers( increase incentives "or !oca! po,ers to p!ay )a2or po,ers a%ainst one another( and

undercut our will to prec!ude or respond to international crises because o* the higher risk o* escalation.

The staes are hi%h. n )odern history( the longest period o* peace a)on% the %reat po,ers has been the era o* 8.9.

leadership. +y contrast( multi0polar systems ha/e been unstable( with their co)petitive dyna)ics resu!tin% in

*reDuent crises and ma,or wars among the great powers . 6ai!ures o" )u!ti-po!ar internationa! syste)s produced $oth

,or!d ,ars. A)erican retrench)ent cou!d have devastatin% conseIuences. ithout an A)erican security $!anet( re%iona! po,ers cou!d rear) in

an atte)pt to $a!ance a%ainst e)er%in% threats. nder this scenario( there would be a hei%htened possi$i!ity o" arms races(

miscalc ulation( or other crises spiraling into all0out con*lict. A!ternative!y( in seeking to accommodate

the stronger powers( weaker powers may shi*t their geopolitical posture away *rom the 8nited

9tates. Either ,ay( hostile states would be emboldened to make aggressi/e mo/es in their re%ions. As riva! po,ers

rise( Asia in particu!ar is !ie!y to e)er%e as a one o" %reat-po,er co)petition. +ei2in%s econo)ic rise has ena$!ed a dra)atic )i!itary $ui!dup

"ocused on acIuisitions o" nava!( cruise( and $a!!istic )issi!es( !on%-ran%e stea!th aircra"t( and anti-sate!!ite capa$i!ities. &hinas strate%ic

)oderniation is ai)ed( u!ti)ate!y( at denyin% the nited *tates access to the seas around &hina. Even as cooperative econo)ic ties in the re%ion

have %ro,n( &hinas epansive territoria! c!ai)s -- and provocative state)ents and actions "o!!o,in% crises in orea and incidents at sea -- have

roi!ed its re!ations ,ith *outh orea( Capan( ndia( and *outheast Asian states. *ti!!( the nited *tates is the )ost si%ni"icant $arrier "acin%

&hinese he%e)ony and a%%ression.

http://www.nationalreview.com/articles/259024/economy-and-national-security-zalmay-khalilzad

http://www.nationalreview.com/articles/259024/economy-and-national-security-zalmay-khalilzad



China ?ar

ecaying o* the American auto industry would cause China to displace it @ causes surging

trade de*icits and breaks in the relationship.

AA! A!!iance "or A)erican Manu"acturin%5( Canuary 2$12( hite ouse aper( The Attac on theA)erican Auto arts ndustry a &a!! "or Action(F http://a)erican)anu"acturin%.or%/"i!es/Auto<#0arts<#0hite<#0aper<#06ina!.pd" Ear!ier( this paper discussed the de%ree to ,hich the *ates o* auto assembly and auto parts production are

intertwined. The disruption caused $y un"air Chinese practices has cause d a break in that relations hip in the

8.9 .( $ecause the advanta%es the &hinese products receive )ae the) a!!-$ut-i)possi$!e to resist to the .*. auto)aers. The net step in this

process is as predicta$!e as it is dan%erous to the .*. econo)y. As the American auto parts sector decays( it will only

make sense to the automakers to *urther o**shore assembly to places like China and Meico( the $etter to

)ae use o" the parts sectors that sti!! eist. As the Chinese parts industry continues to displace the American parts

industry( it is easy to e:trapolate ho, the assembly industry will *ollow. A"ter the etraordinary e""orts that the .*.

has taen in order to eep do)estic auto)aers a"!oat( it is unconsciona$!e that ,e shou!d !et the) s!ip a,ay $y a!!o,in% the do)estic supp!ychain to ,ither. The .*. is not the on!y nation that has a !ar%e( i)portant auto industry. *ince &hina is en%a%in% in such a )assive e""ort to

do)inate the auto and auto parts )aret( it is instructive to !oo at ho, this is a""ectin% the other )a2or auto producin% nations. ere Chinas

rise in this industry inevita$!e( one would e:pect to see other autoproducin% nations in a predica)ent si)i!ar to A)ericaNs(runnin% huge and rising trade de*icits in autos and auto parts with China .

ecline in market parity between China and the 8.9. would cause 8.9.0China war.

a!ter R. !ead( March/Apri! 2$$( *enior 6e!!o, at &ounci! on 6orei%n Re!ations( A)ericas*T& o,er(F 6orei%n o!icy( @eis eis*i)i!ar!y( in the !ast >0 years( as "orei%ners have acIuired a %reater va!ue in the nited *tates-%overn)ent and private $onds( direct and port"o!io

private ChinaIs rise to global prominence will o**er a key test case *or sticky power. As China de/elops

economically( it should gain wealth that could support a military ri/aling that o* the 8 nited 9 tatesG

&hina is a!so %ainin% po!itica! in"!uence in the ,or!d. 9ome analysts in $oth &hina and the nited *tates belie/e that the laws o*

history mean that Chinese power will someday clash with the reigning 8.9. po,er. 9ticky power o**ers

a way out. &hina $ene"its "ro) participatin% in the .*. econo)ic syste) and inte%ratin% itse!" into the %!o$a! econo)y. +et,een 19;0 and

#003( &hinas %ross do)estic product %re, "ro) an esti)ated H10> $i!!ion to )ore than H1.3 tri!!ion. +y #003( an esti)ated H4?0 $i!!ion o""orei%n )oney had "!o,ed into the &hinese econo)y. Moreover( China is becoming increasingly dependent on both

imports and e:ports to keep its economy and its )i!itary )achine5 going . osti!ities $et,een the nited *tates and &hina

,ou!d cripp!e &hinas industry( and cut o"" supp!ies o" oi! and other ey co))odities. *ticy po,er ,ors $oth ,ays( thou%h. " &hina cannot

a""ord ,ar ,ith the nited *tates( the nited *tates ,i!! have an increasin%!y hard ti)e $reain% o"" co))ercia! re!ations ,ith &hina. n an

era o* w eapons o" m ass d estruction( this mutual dependence is pro$a$!y good *or both sides. 9ticky power did

not pre/ent ?orld ?ar ( but economic interdependence runs deeper now; as a result( the

ine/itable 8.9.0Chinese con*lict is less likely to occur.

http://americanmanufacturing.org/files/Auto%20Parts%20White%20Paper%20Final.pdf







A&s



A& Alt CauseF <il

<il prices steadily dropping and are lowest since August

Mar 9henk - *ep #?( #012 3:4; M 8MT-0?00 http://,,,.$!oo)$er%.co)/ne,s/#01#-09-#?/oi!-c!i)$s-as-

ho)e-prices-in-u-s-increase.ht)! Reporter "or +!oo)$er% e,s A )assive data strea)( unpara!!e!ed in scope and

depth( de!ivered to your destop in rea! ti)e. A!on% ,ith data( the +!oo)$er% ro"essiona!` provides access to a!!the ne,s( ana!ytics( co))unications( charts( !iIuidity( "unctiona!ities and eecution services that you need to putno,!ed%e into action.

<il *ell to a se/en0week low as 6edera! Reserve +an o" hi!ade!phia resident &har!es !osser said a ne,

sti)u!us pro%ra) pro$a$!y ,onNt $oost %ro,th. rices dropped $.' percent a"ter !osser said $ond $uyin%

announced $y the 6ed pro$a$!y ,onNt spur epansion or hirin%. 6utures sur%ed to a #01# hi%h o" H100.4# a $arre! on*ept. 14( a day a"ter the 6edera! 'pen Maret &o))ittee said it ,i!! undertae a third round o" Iuantitative easin%.orries a$out the econo)y and our a$i!ity to %ro, have $een ,ei%hin% on the )aret(F said Cohn i!du""( a partner at A%ain &apita! @@&( a e, or-$ased ener%y hed%e "und. eNve "a!!en Iuite a $it "ro) H100 on concern that

Iuantitative easin% ,onNt $e enou%h.F Crude oil *or No/ember deli/ery dropped G' cents to MB1.3H a

barrel on the New Pork !ercantile +:change( the lowest settlement since Aug. 2. The contract rose to

H93.#0 ear!ier. rices are down H.G percent this year. rices ,ere !itt!e chan%ed a"ter the industry-"unded

A)erican etro!eu) nstitute reported oi! inventories increased 33?(000 $arre!s to 3>1.= )i!!ion !ast ,ee. 6utures"e!! H1.19( or 1.3 percent( to H90.;4 a $arre! at 4:4? p.). rices ,ere at H90.9> $e"ore the report ,as re!eased at 4:30 p.). +rent "or ove)$er sett!e)ent rose >4 cents( or 0.> percent( to H110.4? a $arre! on the @ondon-$ased &E6utures Europe echan%e. The European $ench)ar %radeNs pre)iu) to est Teas nter)ediate ,idened toH19.0=( the )ost since Au%. 1>.

<il prices dropping0 demand to low

&!audia Assis and *ara 9,olin( Maretatch *ept. #?( #012( ?:3# p.). EDT

http://,,,.)aret,atch.co)/story/oi!-"utures-re$ound-in-e!ectronic-tradin%-#01#-09-#4 &!audia Assis is a *an6rancisco-$ased reporter "or Maretatch. *ara *2o!in is a Maretatch reporter( $ased in @ondon. Bir%iniaarrison in *ydney contri$uted to this report.

Crude *or No/ember deli/ery &@L# -0.?4< declined G' cents( or 0.><( to sett!e at H91.3; a $arre! on the

e, or Mercanti!e Echan%e. &hat was oils lowest settlement since Aug. 2 . 'i! traded hi%her ear!ier

Tuesday as %eopo!itica! tensions and re!ative!y positive .*. )acroecono)ic data $oosted prices. &har!es !osser( president o" the hi!ade!phia 6edera! Reserve( said the 6ed )ay have to raise short-ter) interest rates ,e!! $e"oreFthe current )id-#01? tar%et. n addition( !osser( ,ide!y seen as a ha,( criticied the !atest round o" $ond purchasesand said "urther easin% ,as un!ie!y to $e e""ective. *ee: 6edNs !osser s!a)s XE3. &astin% dou$t on XE3 see)edto spar a ra!!y in the .*. do!!ar inde...that !ed to rene,ed investor se!!in% in )ost co))odities(F said Darin

e,so)( senior ana!yst at Te!vent DT. All in all( /olume seems to be light in most markets( so it

doesnt take much to turn them one way or the other.> &rude and other co))odity prices too a tu)$!ea"ter !osserNs co))ents. The do!!ar pared so)e o" its !osses as ,e!!( then turned hi%her( providin% an etra sIueee

"or do!!ar-deno)inated co))odities such as oi!. *ee )ore on do!!ar action as !osser Iuestions XE3. emand *or

oil is still too weak to ,usti*y higher prices( said Ca)es &ordier( a port"o!io )ana%er ,ith 'ptionse!!ers.co) in

6!orida. A lot o* the easy money in oil has been made already(F he said. &he uptick *or the dollar was

the e:cuse some needed to sell oil and reali-e some Duick pro*it s( he said. 'i! had !ost %round on Monday

as European de$t aniety resur"aced and oi! ended at a seven-,ee !o,. rices have !ost 1.>< over the t,o days.

http://www.bloomberg.com/news/2012-09-25/oil-climbs-as-home-prices-in-u-s-increase.html






A& Alt CauseF 9teel

&urn0 Auto key to steel industry

Agence Krance resse( $B 8!o$a! stee! industry a,aits &hina( * auto turnaroundF( Apri! 1#( @eis5

*tee! is on ed%e and the %!o$a! industry is cuttin% $ac hard( han%in% on "or either a $ud%et $!ast "ro) &hina( ne, credit "or vast

Midd!e Eastern $ui!din% sche)es or resurrection o" the * auto industry. De)and has d,ind!ed and stee!)aers(

nota$!y the %iant o" the) a!!( Arce!orMitta!( are da)pin% do,n surp!us "urnace capacity ,hi!e ,aitin% "or credit to "!o,( construction

cranes to turn and "actories to ro!!. A decision $y Arce!orMitta! !ast ,ee to pursue te)porary production cut$acs( s!ashin% European output $y)ore than ha!" "ro) the end o" Apri! accordin% to a union source( dra)atises the etraordinary ride and ro!e o" stee! in the !ast "e, years. n 2ust)onths the %!o$a! industry has %one "ro) a $oo) driven !ar%e!y $y &hina( e)er%in% )arets and a property etrava%ana in the Midd!e East to a

narro, !ine $et,een ecess capacity and the costs o" ,aitin% "or recovery. 7'ver the past si )onths( de)and "or stee! hasdropped dra)atica!!y and( as a resu!t( producers have $een cuttin% production(7 ana!ysts at +arc!ays &apita! said in a

study !ast ,ee. n another report( Mor%an *tan!ey predicted 7the current de)and shoc to !ead to ecess stee! capacity.7&onseIuent!y( the $an said( stee! p!ants shou!d operate at rates $e!o, ;? percent o" capacity unti! #01# .

7The stee! )aret is not very di""erent "ro) $ase )eta!s as a ,ho!e( $ut stee! has reacted )ore rapid!y and dra)atica!!y since *epte)$er(7 said

co))odities ana!yst errine 6aye o" @ondon-$ased 6astMarets. *he said the "uture o" the stee! industry depended on three

"actors -- the i)pact o" &hinese econo)ic sti)u!us e""orts( a pic-up in the Midd!e East construction sector and a reviva! o" the once)i%hty * auto industry. 7&hinese i)ports and eports are at a standsti!!. Everyone is ,aitin% "or the &hinese sti)u!us paca%e to see

i" it ,i!! revive de)and.7 The &hinese %overn)ent !ast )onth announced a "our-tri!!ion-yuan ?=0-$i!!ion-do!!ar5 paca%e o" )easures that itsaid cou!d contri$ute 1.? to 1.9 percent to the countrys econo)ic %ro,th. ndustry eperts have )ean,hi!e spoen opti)istica!!y o" &hinas

prospects. Tho)as A!$anese( chie" eecutive at stee! )aer Rio Tinto( said ear!ier this year that the co)pany "oresa, 7a short( sharp s!o,do,nin &hina( ,ith de)and re$oundin% over the course o" #009( as the "unda)enta!s o" &hinese econo)ic %ro,th re)ain sound.7 Ana!ysts have saidstee! inventories are "a!!in% in &hina in anticipation o" pro2ects epected to e)er%e "ro) the countrys hu%e sti)u!us paca%e. 7t is encoura%in%that the inventory o" stee! products( especia!!y !on% products( ,hich are )ost!y used in construction pro2ects( have started to "a!! since the end o"March5( !ie!y su%%estin% that end-de)and is %atherin% )o)entu)(7 6ran 8on%( a on% on%-$ased econo)ist "or CMor%an( ,rote in aresearch note. 'n-the-%round evidence su%%ested that the &hinese industry had $een re-stocin% in the "irst t,o )onths o" the year( "o!!o,ed $ya pause in March $e"ore )a2or in"rastructure pro2ects ,ere epected to start in the second Iuarter( 8on% ,rote. n the Midd!e East( accordin% to6aye( the $i% pro$!e) is a shorta%e o" credit( nota$!y "or rea! estate deve!opers and $ui!ders. &onstruction p!anners had 7counted on a hi%her

price "or oi! and on credit to "inance their hu%e pro2ects.7 n addition( de)and "or such "aci!ities( especia!!y in the 8u!"( has died. 7They ,erehopin% that A)ericans and Europeans ,ou!d $uy apart)ents. +ut property prices have co!!apsed in the Midd!e East as ,e!!.7 n the nited Ara$E)irates )ore than ha!" the $ui!din% pro2ects( ,orth ?=# $i!!ion do!!ars or 4? per cent o" the tota! va!ue o" the construction sector( have $een puton ho!d( a study $y Du$ai-$ased )aret research %roup ro!eads "ound in 6e$ruary. n Du$ai( one o" the states o" the AE( prices in the rea!estate sector have s!u)ped $y an avera%e o" #? percent "ro) their pea in *epte)$er a"ter ra!!yin% ;9 percent in the 1= )onths to Cu!y #00=(

accordin% to Mor%an *tan!ey. 6aye said the "ate o" the stee! sector ,as in addition tied to that o" the stru%%!in% *

auto industry ( once a thrivin% stee! )aret $ut one in ,hich t,o o" its %iant p!ayers( 8enera! Motors and&hrys!er( are starin% at $anruptcy. The t,o co)panies are current!y !i)pin% a!on% thans to $i!!ions o"do!!ars in %overn)ent aid. 7e are ,aitin% to see i" the auto sector in the * ,i!! %et out o" the crisisintact(7 she said.

)uy America pro/isions mean steel is produced in the 89

epartment o* &ransportation 1$ &urrent !ist o" provisions o" the +uy A)erica Act( 14 Dece)$er #010(

http://,,,.dot.%ov/$uya)erica/$uyOa)ericaO.pd" 5

American Reco/ery and Rein/estment Act o* 2$$B( *ection 1>0? [ +uy A)erican 100< Do)estic &ontent o" ite)s

$e!o,5 +uy A)erican The Recovery Act prohibits use o* reco/ery *unds *or a pro,ect "or the construction( a!teration(

)aintenance( or repair o" a pu$!ic $ui!din% or pu$!ic ,or unless all o* the iron( steel( and manu*actured goods used in

the pro,ect are produced in the 8nited 9tates. aivers The head o" the 6edera! depart)ent or a%ency "inds that: 15 t ,ou!d

$e inconsistent ,ith the pu$!ic interestG #5 ron( stee!( and the re!evant )anu"actured %oods are not produced in the nited *tates in su""icient andreasona$!y avai!a$!e Iuantities and o" a satis"actory Iua!ityG or 35 nc!usion o" iron( stee!( or )anu"actured %oods produced in the nited *tates,i!! increase the cost o" the overa!! pro2ect $y )ore than #? percent. 'ther There are provisions in the Recovery Act "or the 6edera! AviationAd)inistration( 6edera! Transit Ad)inistration( 6edera! Rai!road Ad)inistration( and 6edera! i%h,ay Ad)inistration to app!y their o,n %rantreIuire)ents( inc!udin% +uy A)erican5. A!! ,aivers have to $e posted in 6edera! Re%ister. .*. internationa! o$!i%ations or!d Trade'r%aniation 8overn)ent rocure)ent A%ree)ent( .*. 6ree Trade A%ree)ents( .*.-E& Echan%e o" @etters May 1?( 199?U( and &anada-.*.

A%ree)ent on 8overn)ent rocure)ent5 app!y. Kederal A/iation Administration "KAA# 49 .*.&. ?0101 [ +uy A)erican

see discretionary ,aiver ,hen >0< Do)estic &ontent o" ite)s $e!o,5 +uy A)erican The 6AA will not obligate any *unds

authori-ed to be appropriated *or any pro,ect unless steel and manu*actured products used in such

pro,ects are produced in the 8nited 9tates . aivers The Ad)inistrator has de!e%ated authority to %rant ,aivers to this

http://www.dot.gov/buyamerica/buy_america_.pdf

http://www.dot.gov/buyamerica/buy_america_.pdf



reIuire)ent to Director o" AcIuisition and &ontractin%G Re%iona! Ad)inistratorsG and &enter Directors upon "indin% that co)p!iance ,ith the Act,ou!d: 15 t ,ou!d $e inconsistent ,ith the pu$!ic interestG #5 The stee! and %oods produced in the nited *tates are not produced in a su""icientand reasona$!y avai!a$!e a)ount or are not o" a satis"actory Iua!ityG 35 hen procurin% a "aci!ity or eIuip)ent under the Airport and Air,ay)prove)ent Act o" 19=#: A5 the cost o" co)ponents and su$co)ponents produced in the nited *tates is )ore than >0 percent o" the cost o" a!!co)ponents o" the "aci!ity or eIuip)entG and +5 "ina! asse)$!y o" the "aci!ity or eIuip)ent has occurred in the nited *tatesG or 45 nc!udin%do)estic )ateria! ,i!! increase the cost o" the overa!! pro2ect $y )ore than #? percent. 'ther @a$or costs invo!ved in "ina! asse)$!y are notinc!uded in ca!cu!atin% the cost o" co)ponents. .*. internationa! o$!i%ations or!d Trade 'r%aniation 8overn)ent rocure)ent A%ree)ent(.*. 6ree Trade A%ree)ents( .*.-E& Echan%e o" @etters May 1?( 199?U( and &anada-.*. A%ree)ent on 8overn)ent rocure)ent5 do not

app!y. Kederal 7ighway Administration "K7?A# #3 .*.&. 313 [ +uy A)ericaG #3 &.6.R. >3?.410 100< Do)estic

&ontent o" ite)s $e!o,5 +uy A)erica The *ecretary o" Transportation shall not obligate any *unds unless steel( iron( and

manu*actured products used in such pro,ect are produced in the 8nited 9tates. Applies to iron and

steel products and their coatings that are to be permanently incorporated into the pro,ect. The 6A(

in its 19=3 ru!e)ain%( deter)ined that +uy A)erica did not app!y to ra, )ateria!s and ,aived its app!ication to )anu"actured products(a!thou%h in the statute( $ased on the pu$!ic interest. @ac o" adeIuate do)estic supp!y resu!ted in a 199? nation,ide ,aiver "or iron ore( pi% iron(and reduced/processed/pe!!etied iron ore. n 1994( a nation,ide ,aiver "or speci"ic "erry$oat parts ca)e into e""ect. aivers The *ecretary o"Transportation )ay ,aive the reIuire)ent i" the *ecretary "inds that: 15 t ,ou!d $e inconsistent ,ith the pu$!ic interestG #5 *uch )ateria!s and

products are not produced in the nited *tates in su""icient and reasona$!y avai!a$!e Iuantities and o" a satis"actory Iua!ityG or 35 nc!usion o"do)estic )ateria! ,i!! increase the cost o" the overa!! pro2ect contract $y )ore than #? percent this is a standin% ,aiver codi"ied in re%u!ations,hen a!ternate $iddin% procedures are used5. 'ther @a$or costs invo!ved in "ina! asse)$!y are not inc!uded in ca!cu!atin% the cost o" co)ponents.A!! ,aivers have to $e posted in 6edera! Re%ister. A!! proposed ,aivers are "irst posted on the 6ANs ,e$site "or a 1?-day co))ent period

prior to pu$!ishin% the "ina! decision in the 6edera! Re%ister. .*. internationa! o$!i%ations or!d Trade 'r%aniation 8overn)ent rocure)entA%ree)ent( .*. 6ree Trade A%ree)ents( .*.-E& Echan%e o" @etters May 1?( 199?U( and &anada-.*. A%ree)ent on 8overn)ent

rocure)ent5 do not app!y. Kederal Railroad Administration "KRA# i%h *peed Rai! ro%ra) 49 .*.&. &hapters #44( #4>G

#440? [ +uy A)erica 100< Do)estic &ontent o" ite)s $e!o,5 +uy A)erica The *ecretary o" Transportation may obligate *unds *ora pro,ect only i* the steel( iron( and manu*actured goods used in the pro,ect are produced in the

8nited 9tates . aivers The *ecretary o" Transportation )ay ,aive the reIuire)ent i" the *ecretary "inds that: 15 t ,ou!d $e inconsistent

,ith the pu$!ic interestG #5 The stee!( iron( and %oods produced in the nited *tates are not produced in a su""icient and reasona$!y avai!a$!ea)ount or are not o" a satis"actory Iua!ityG 35 Ro!!in% stoc or po,er train eIuip)ent cannot $e $ou%ht and de!ivered in the nited *tates ,ithina reasona$!e ti)eG or 45 nc!udin% do)estic )ateria! ,i!! increase the cost o" the overa!! pro2ect $y )ore than #? percent. 'ther ThereIuire)ents on!y app!y to pro2ects "or ,hich the costs eceed H100(000. @a$or costs invo!ved in "ina! asse)$!y are not inc!uded in ca!cu!atin%the cost o" co)ponents. A!! ,aivers have to $e posted in 6edera! Re%ister. .*. internationa! o$!i%ations or!d Trade 'r%aniation 8overn)entrocure)ent A%ree)ent( .*. 6ree Trade A%ree)ents( .*.-E& Echan%e o" @etters May 1?( 199?U( and &anada-.*. A%ree)ent on

8overn)ent rocure)ent5 do not app!y. National Railroad assenger Corporation "A!&RA# 49 .*.&. #430?

Do)estic +uyin% re"erences A)tra shall buy onlyF "A# unmanu*actured articles( material( and supplies

mined or produced in the 8nited 9tates; or ")# manu*actured articles( material( and supplies

manu*actured in the 8nited 9tates substantially *rom articles( material( and supplies mined(

produced( or manu*actured in the 8nited 9tates. aivers The *ecretary )ay ee)pt A)tra "ro) this su$section i" the

*ecretary decides that: A5 "or particu!ar artic!es( )ateria!( or supp!ies-i5 the reIuire)ents are inconsistent ,ith the pu$!ic interestG ii5 the cost o" i)posin% those reIuire)ents is unreasona$!eG or iii5 the artic!es( )ateria!( or supp!ies( or the artic!es( )ateria!( or supp!ies "ro) ,hich they are)anu"actured( are not )ined( produced( or )anu"actured in the nited *tates in su""icient and reasona$!y avai!a$!e co))ercia! Iuantities and arenot o" a satis"actory Iua!ityG or +5 ro!!in% stoc or po,er train eIuip)ent cannot $e $ou%ht and de!ivered in the nited *tates ,ithin a reasona$!e

ti)e. 'ther The reIuire)ents app!y on!y ,hen the cost o" those artic!es( )ateria!( or supp!ies $ou%ht is at !east H1 )i!!ion. Kederal &ransit

Administration "K&A# 49 .*.&. ?3#325G 49 &.6.R. art >>1 +uy A)erica ReIuire)ents5G *ee >0< Do)estic &ontent "or $uses

and other Ro!!in% *toc5 +uy A)erica No *unds may be obligated by K&A *or a grantee pro,ect unless all iron(

steel( and manu*actured products used in the pro,ect are produced in the 8nited 9tates. aivers The

Ad)inistrator )ay ,aive the %enera! reIuire)ents i" the Ad)inistrator "inds that: 15 t ,ou!d $e inconsistent ,ith the pu$!ic interestG #5 The)ateria!s "or ,hich a ,aiver is reIuested are not produced in the nited *tates in su""icient and reasona$!y avai!a$!e Iuantities and o" asatis"actory Iua!ityG 35 The inc!usion o" a do)estic ite) or do)estic )ateria! ,i!! increase the cost o" the contract $et,een the %rantee and itssupp!ier o" that ite) or )ateria! $y )ore than #? percent. Ro!!in% stoc procure)ents a5 The +uy A)erica prov isions do not app!y to the

procure)ent o" $uses and other ro!!in% stoc inc!udin% train contro!( co))unication( and traction po,er eIuip)ent5( i" the cost o" co)ponents produced in the nited *tates is )ore than >0 percent o" the cost o" a!! co)ponents and "ina! asse)$!y taes p!ace in the nited *tates. 'ther@a$or costs invo!ved in "ina! asse)$!y are not inc!uded in ca!cu!atin% the cost o" co)ponents. ost on!y pu$!ic interestF ,aivers in 6edera!

Re%ister. .*. internationa! o$!i%ations or!d Trade 'r%aniation 8overn)ent rocure)ent A%ree)ent( .*. 6ree Trade A%ree)ents( .*.-E&Echan%e o" @etters May 1?( 199?U( and &anada-.*. A%ree)ent on 8overn)ent rocure)ent5 do not app!y.

9teel is not critical to auto industry( its the other way around

Cohn 7all *epte)$er 09( #012 at 11:30 AM Cohn a!! is a "ree!ance ,riter ,ho reports on co))odities

)arets and procure)ent and supp!y )ana%e)ent topics "or My urchasin%&enterhttp://,,,.)ypurchasin%center.co)/co))odities/co))odities-artic!es/stee!-price-"orecast-"or-#013/



Even thou%h it is d,ar"ed $y construction( the 8.9. auto industrys comeback has been a bright spot on

the hori-on *or the steel business ( accordin% to avana%h at the *tee! Maret Deve!op)ent nstitute. t

doesnt hurt that the industry is a *a/ored user o* domestic steel.

Auto industry reducing steel use

Cohn 7all *epte)$er 09( #012 at 11:30 AM Cohn a!! is a "ree!ance ,riter ,ho reports on co))odities

)arets and procure)ent and supp!y )ana%e)ent topics "or My urchasin%&enterhttp://,,,.)ypurchasin%center.co)/co))odities/co))odities-artic!es/stee!-price-"orecast-"or-#013/n "act( )ost *oreign car makers are mo/ing away *rom imported steel ( accordin% to Anton. Around

2$$$( North America production le/els *or light0duty /ehicles was at about 1' million per year. t

slowly declined to about 1G million . +y #009( it p!un%ed to a$out =.> )i!!ion. n 2$12( the domesticauto industry is pro,ected to produce about 1 million light duty /ehicles . n"ortunate!y( other stee!-hun%ry industries arenNt re$oundin% as ,e!!. Today( app!iances are on!y $ein% $ou%ht ,hen the o!d ones $rea(FAnton says. The app!iances ,onNt co)e $ac unti! peop!e have enou%h disposa$!e inco)e to do re)ode!in%( etc.FThat cou!d chan%e in the net "e, years as a%in% app!iances reach their use"u! !i"eti)es.



A& Automobility )ad

&urn0 Automobility ine/itable and critical to human automony

Custin ood( &u))in%s K 8ood Desi%n( This essay ,as presented at the nternationa! *ociety "or

niversa! Dia!o%ue *ith or!d &on%ress( N< A&+( Eco!o%y( 6reedo) and Auto)o$i!ityF(,,,.en%r.uconn.edu/.../Auto)o$i!ity<#0Custin<#08ood.docThe eperience o" dri/ing is an e:perience o* liberation )ost o$vious!y $ecause o" the connection

between being *ree and being mobile and sel*0directed. &hese connections are rooted deeply in our

biology and our concept o* *reedom as autonomy ( or sel*0rule. At the )ost pri)a! !eve!(

automobility answers to the same biological impulse that dri/es a crawling in*ant across the *loor .

Any technology which satis*ies a biologically0predisposed interest o* ours is going to be *elt as

liberating. The interest is re!ated to the inetic p!easure ,e "ee! in speedin% do,n the hi%h,ay( and the"ee!in% o" po,er and contro! that operatin% a car can %ive. !ore importantly( the mobility which cars

enhance illustrates our concept o* *reedom as autonomy due to the ways in which cars gi/e us new

choices and options *or mo/ement. n a de"ense o" automobility as an intrinsic ethical good ( @oren

@o)asy ar%ues that automobility essentially complements human autonomy : n the !atter part o" thet,entieth century( being a sel*0mo/er entails( to a signi*icant e:tent( being a motorist. +ecause ,ehave cars ,e can( )ore than any other peop!e in history( choose ,here ,e ,i!! !ive and ,here ,e ,i!!,or( and separate these choices "ro) each other. ?e can more easily a/ail oursel/es o* near and

distant pleasures( at a scheduled tailored to indi/idual pre*erences. n our choice o* *riends and

associates( we are less constrained by accidents o* geographical pro:imity. n our co)in%s and%oin%s( ,e depend !ess on the concurrence o" others.

&urn0 &he car is crucial to eDuality @ it pro/ides mobility which would otherwise be

monopoli-ed by the aristocracy

*a) a-man( #9 *epte)$er #0$G( %enera! counse! o" the &o)petitive Enterprise nstitute(

Auto)o$i!ity and 6reedo)F(

http://,,,."reedo)advocates.or%/artic!es/!e%iti)ateO%overn)ent/auto)o$i!ityOandO"reedo)O#00?093013;/A century and a ha!" a%o( the !e%a! scho!ar *ir enry Maine o$served that the e/olution o* human

society was a mo/ement *rom a society o* status towards a society o* contract. n traditiona! society(,hat you were depended on the circumstances o* your birth . +orn a ser"( you re)ained a ser" a!! your!i"e. )orn an aristocrat ( you remained an aristocrat all your li*e. !odern society( howe/er( is a

society o* contract( in which what you can become depends upon what you can do . n a si)i!ar ,ay( thin( )uch o" our recent history has invo!ved not 2ust evo!utionary )ove)ent( $ut a!so !itera! )ove)ent.?eI/e become a society o * *ar greater physical mo/ement . &raditionally( *or most people( where you

li/ed depended upon where you born. Aristocrats( o* course( ha/e always been able to get around (

but that was a *reedom common people did not pre/iously en,oy . ?hat is new in this century( as a

result o* the automobile ( is that physical mobility has become accessible to ,ust about e/eryone who

is *ree .

&urn0 &he car is a liberating( ethical machine


Auto)o$i!ity and 6reedo)F(http://,,,."reedo)advocates.or%/artic!es/!e%iti)ateO%overn)ent/auto)o$i!ityOandO"reedo)O#00?093013;/



My essentia! the)e is that the car is ,ust not another consumer item( and not ,ust a /ery important

consumer item; rather( that it is something incredibly special( something that ranks with only a

hand*ul o* other technologies that can truly be said to ha/e liberated mankind . n a sense( the car

is morally di**erent *rom most other consumer goods. t has a ma,or ethical dimension( and that is

something we are losing sight o*. Moreover ( it is this special moral *eature that accounts *or the

increasing barrage o* ideological attacks on the car.

&urn0 Attacks on the car are a worship o* go/ernment control

.C. <Rourke is a correspondent "or The At!antic( the .@. Mencen Research 6e!!o, at the &ato

nstitute( a contri$utor to )a%aines ran%in% "ro) Ro!!in% *tone to The A)erican *pectator( ov. 2$$B( Driven &rayF( http://reason.co)/archives/#009/11/03/driven-crayhy do politicians lo/e trainsJ )ecause they can tell where the tracks go. They no, ,here

every$odyNs %oin%. ts all about control. t is all about power . olitics itsel* is nothing but an

attempt to achie/e power and prestige without merit. That is the de"inition o" po!itics. oliticians

hate cars . &hey ha/e always hated cars( because cars make people *ree . Not only *ree in the sense

that they can go anywhere they want ( which bugs politicians in the *irst place( but they can mo/eout o* the political district that the politician represents .



A& <il 5obbies

&urn0 8.9. auto industry backed by three ma,or en/ironmental organi-ations

NRC u$!ished Au%ust 9( #012 0;:09 AM http://,,,.enn.co)/$usiness/artic!e/44;;9 The atura! Resources

De"ense &ounci! RD&5 is an internationa! nonpro"it environ)enta! or%aniation ,ith )ore than 1.3 )i!!ion

)e)$ers and on!ine activists. *ince 19;0( our !a,yers( scientists( and other environ)enta! specia!ists have ,oredto protect the ,or!ds natura! resources( pu$!ic hea!th( and the environ)ent. RD& has o""ices in e, or &ity(ashin%ton( D.&.( @os An%e!es( *an 6rancisco( &hica%o( @ivin%ston( Montana( and +ei2in%.

ith the !aunch o" ne, "edera! vehic!e "ue! econo)y ru!es on!y a$out one ,ee a,ay( the American auto

industry has grown by nearly a Duarter million ,obs "23'('$$# since Eune 2$$B when the auto

industry hit bottom( accordin% to a ne, report avai!a$!e "ro) Drivin%8ro,th.or%. The report "ro)Drivin%8ro,th.or% http://,,,.Drivin%8ro,th.or%5 "inds that "ue! e""iciency is a )a2or "actor $ehind the %ains in

.*. auto 2o$s. A website that tracks the re/itali-ation o* the 8.9. auto industry ( ri/ingrowth.org is

sponsored by three leading 8.9. en/ironmental organi-ations F The atura! Resources De"ense &ounci!(the ationa! i!d!i"e 6ederation( and the Michi%an @ea%ue o" &onservation Boters Education 6und.

!anu*acturing o* motor /ehicle and parts has grown by 1'G(1$$( or 2'. percent since Eune 2$$B.

Another H1(G$$ ,obs ha/e been added at 8.9. auto dealerships. Automakers( their suppliers and

their dealers are now looking ahead to a brighter *uture a*ter the dark days o* the recession.Ea)p!es o" ho, "ue!-e""iciency standards are acce!eratin% the auto industryNs recovery in the .*. inc!ude the"o!!o,in%: Michi%an -- 3?(#00 ne, auto )anu"acturin% 2o$s since Cune #009 ,hen the auto industry hit $otto)(accountin% "or ha!" o" the stateNs tota! 2o$ %ains over the sa)e period. n *a%ina,( Michi%an( "or ea)p!e(auto)otive supp!ier has added >?0 2o$s and ,i!! retain an additiona! 1(000 2o$s "or production o" e!ectric po,ersteerin% co)ponents E*5 "or .*.-)ade picup trucs. E*( ,hich rep!aces a )ore "ue! intensive hydrau!icsyste)( can $oost "ue! econo)y $y 4->percent on a typica! vehic!e. ndiana -- 19(=00 ne, auto )anu"acturin% 2o$ssince Cune #009 ,hen the auto industry hit $otto)( accountin% "or over one third o" the stateNs tota! 2o$ %ains overthe sa)e period. n 8reens$ur%( ndiana( onda is investin% H40 )i!!ion and ,i!! hire 300 ne, ,orers as itsndiana "aci!ity $eco)es the so!e %!o$a! producer o" the "ue!-e""icient onda &ivic hy$rid. t ,i!! $e eported to)arets around the ,or!d "ro) ndiana. 'hio -- 11(300 ne, auto 2o$s since Cune #009 ,hen the auto industry hit $otto)( accountin% "or one Iuarter o" the states tota! 2o$ %ains over the sa)e period. n arren( 'hio( 8enera!Motors is runnin% three shi"ts at its @ordsto,n Asse)$!y p!ant( addin% 1(#00 2o$s and e)p!oyin% 4(#00 tota!,orers to produce the hi%h-)i!ea%e &hevy &rue( ,hich achieves 4# )i!es per %a!!on M85 in the Eco&rue

)ode!. 79etting strong *uel e**iciency standards means we are sending more o* our energy dollars to

the !idwest( not the !iddle +ast said &i**any ngram( !idwest ad/ocacy director *or NRC.

lobal automakers are now sourcing their most ad/anced( high0tech manu*acturing here in the

8nited 9tates( creating a more sustainable and secure *uture *or 8.9. industry and 8.9. workers.

<il 5obbies in*luence weakened( eystone ipeline pro/es

&apper et al 12 Cae Tapper( irit Radia( Cohn arinson( Devin D,yer( *ta"" riters( Can. 1=( #01#(http://a$cne,s.%o.co)/o!itics/'T*/president-o$a)a-re2ects-eystone-!-pipe!ine/storyJidV1?3=;9=0P.T-4peu\'CM resident '$a)a Re2ects eystone L@ ipe!ineF5&he <bama administration today *ormally re,ected a $id $y &anadian ener%y co)pany Trans&anada to build a MH

billion oil pipeline linking the tar sands o* Alberta to re*ineries on the ul* o* !e:ico. &he eystone

Q5 pro,ect ( which was estimated to create thousands o* 8.9. ,obs( became an election0year lightningrod( embroiling resident <bama( congressional Republicans( labor unions and interest groups in a

heated debate o/er ,obs and the en/ironment. The *tate Depart)ent( ,hich ho!ds the authority to approve or re2ect pipe!ines

that cross an internationa! $oundary( said in ove)$er that it ,ou!d de!ay a decision on eystone to a!!o, "or "urther study o" the environ)enta!i)pact a!on% its 1(;00-)i!e route. Then in Dece)$er( &on%ress tried to "orce the president to )ae a decision proposa! ,ithin t,o )onths(tucin% the )andate into the payro!! ta cut $i!! that '$a)a u!ti)ate!y si%ned into !a,. +ut the president said today in a state)ent that thecon%ressiona!!y i)posed dead!ine did not provide adeIuate ti)e "or the *tate Depart)ent to "inish a custo)ary revie, o" the pipe!ines route

throu%h si states. 7&he rushed and arbitrary deadline insisted on by Congressional Republicans

pre/ented a *ull assessment o* the pipelineIs impact( especially the health and sa*ety o* the

American people( as well as our en/ironment(7 '$a)a said. 7As a resu!t( the secretary o" state has reco))ended that the

http://www.enn.com/business/article/44779





app!ication $e denied. And a"ter revie,in% the *tate Depart)ents report( a%ree.7 Ad)inistration o""icia!s say the decision e""ective!y hits thereset $utton on a revie, process that has $een under,ay "or severa! years( $ut does not prec!ude Trans&anada "ro) resu$)ittin% a proposa! "orreconsideration. 7hi!e ,e are disappointed( Trans&anada re)ains "u!!y co))itted to the construction o" eystone L@(7 Trans&anada presidentand &E' Russ 8ir!in% said in a state)ent. 7!ans are a!ready under,ay on a nu)$er o" "ronts to !ar%e!y )aintain the construction schedu!e o" the

pro2ect. e ,i!! re-app!y "or a residentia! er)it and epect a ne, app!ication ,ou!d $e processed in an epedited )anner to a!!o, "or an in-

service date o" !ate #014(7 he said. 5abor unions( oil industry groups 00 e/en the presidentIs ,obs council 00

ha/e signaled support *or the plan( ,hich a!so has $ipartisan $acin% on &apito! i!!. )ut en/ironmental groups

warned it would ha/e a dangerous e**ect on ecosystems and human health( ratcheting up pressureon <bama to de*er to his progressi/e base in an election year. 7This announce)ent is not a 2ud%)ent on the )erits o"

the pipe!ine( $ut the ar$itrary nature o" a dead!ine that prevented the *tate Depart)ent "ro) %atherin% the in"or)ation necessary to approve the pro2ect and protect the A)erican peop!e(7 '$a)a said. *ti!!( ne,s o" the re2ection Iuic!y spared conde)nation "ro) )e)$ers o" &on%ress on $oth sides o" the ais!e. ouse *peaer Cohn +oehner o" 'hio( ,ho has said pipe!ine construction ,ou!d 7create 100(000 ne, 2o$s(7 chastised the president and said de!ayin% the dea! )eans &anadians )ay do $usiness ,ith &hina instead. 7The president has said he!! do anythin% that he canto create 2o$s. Today that pro)ise ,as $roen(7 +oehner continued. 7The president ,ont stand up to his po!itica! $ase( even in the na)e o"creatin% A)erican 2o$s.7 Rep. Coe Donne!!y( a De)ocrat "ro) ndiana( said he is 7very disappointed7 in the '$a)a decision. 7They are )issin%an opportunity to create thousands o" 2o$s in A)erica(7 he said. ouse Minority @eader ancy e!osi de"ended '$a)a( $!a)in% Repu$!icans "ore""ective!y tyin% the ad)inistrations hands. 7" the Repu$!icans cared so )uch a$out the eystone pipe!ine( they ,ou!d not have narro,ed the

presidents options $y puttin% it on the ti)e "ra)e that they did(7 e!osi( D-&a!i".( said. !eanwhile( en/ironmental groups

claimed /ictory o/er the oil industry( which had spent millions lobbying intensely *or appro/al o*

the pipeline. &he eystone Q5 *ight was a/id /ersus oliath; no one thought we could win( said

an !oglen o* Kriends o* the +arth. The decision sho,s 7sustained %rassroots pressure ai)ed at ho!din% the president

accounta$!e to the pu$!ic interest proved )ore po,er"u! than a!! the !o$$yists the oi! industry cou!d )uster.7

89 cutting emissions now

och( 9ta** ?riter( 11 endy och( ove)$er 1>( #011(

http://content.usatoday.co)/co))unities/%reenhouse/post/#011/11/o$a)a-sees-to-dou$!e-auto-"ue!-e""iciency/1P.T-4nT-\'C '$a)a sees to dou$!e auto "ue! econo)y $y #0#?F5

n an historic )ove to $oost "ue! e""iciency( the <bama administration proposed ?ednesday to nearly double the

reDuired miles per gallon *or passenger cars and light trucks by 2$2G.

The "or)a! proposa! "o!!o,s resident <bamaIs agreement with 13 ma,or automakers ( announced in Euly( to

gradually boost these /ehiclesI *uel economy to the eDui/alent o* G.G miles per gallon 00 up *rom the

current standard o* 2H.3 mpg. @ast year( the administration *inali-ed rules to hike the standard to 3G.G

mpg by 2$1'. 77e epect this pro%ra) ,i!! not on!y save consu)ers )oney( it will ensure automakers ha/e the

regulatory certainty they need to make key decisions that create ,obs and in/est in the *uture(7 .*.Transportation *ecretary Ray @aood said in a 2oint announce)ent ,ith the .*. Environ)enta! rotection A%ency. e said they!! a!so reduce.*. dependence on oi! and protect the c!i)ate.



A& +n/ironment

&urn0 Not allowing the auto industry collapses research and de/elopment as well as short0

circuiting energy policies that sol/e oil dependence.

etroit News( 11-3-2$$( ana!ysts: +i% 3 oes )peri! * econo)y(Fhttp://detne,s.co)/apps/p$cs.d!!/artic!eJADV/#00=1103/AT'01/=11030343 Allowing an automaker to go under would wipe out portions o* the supply chain( dragging down

healthy *oreign automakers( as ,e!!( that ,ou!d have to scra)$!e to "ind other supp!iers to provide their parts. Auto)aers a!so $uy

H1? $i!!ion a year in advertisin%( not countin% the hu%e a)ount dea!ers spend. Automakers spend more on research and

de/elopment than any other industry e:cept the go/ernment( a$out H1=.? $i!!ion a year( McA!inden said( with G

percent o* that done in !ichigan. +oth presidentia! candidates have energy policies and ta: incenti/es *o r *uel0

sa/ing research that cannot be achie/ed without a healthy and robust auto industry( &*Ms &hes$rou%h

said. 7&he auto sector is key to where the country needs to go in the *uture to reduce oil dependence(7 he said.

<il dependency leads to e:tinction.

Michae! T. lare( 2$$( pro"essor o" peace and ,or!d security studies at a)pshire &o!!e%e( The end

o" the ,or!d as you no, it(F http://,,,.to)dispatch.co)/post/1;4919 A %ro,in% ris o" con"!ict: Throu%hout history( ma,or shi*ts in power ha/e normally been accompanied by /iolence

-- in so)e cases( protracted vio!ent upheava!s. Either states at the pinnacle o* power ha/e struggled to pre/ent the

loss o* their pri/ileged status ( or cha!!en%ers have "ou%ht to topp!e those at the top o" the heap. i!! that happen no,J i!! ener%y-

de"icit states !aunch ca)pai%ns to ,rest the oi! and %as reserves o" surp!us states "ro) their contro! -- the +ush ad)inistrations ,ar in raI )i%ht

a!ready $e thou%ht o" as one such atte)pt -- or to e!i)inate co)petitors a)on% their de"icit-state riva!sJ &he high costs and risks o*

modern war*are are well known and there is a widespread perception that energy problems can

best be sol/ed through economic means( not military ones. Ne/ertheless( the ma,or powers are

employing military means in their e**orts to gain ad/antage in the global struggle *or energy( and no

one shou!d $e de!uded on the su$2ect. &hese endea/ors could easily enough lead to unintended escalation and

con*lict . 'ne conspicuous use o" )i!itary )eans in the pursuit o" ener%y is o$vious!y the re%u!ar trans"er o" ar)s and )i!itary-support services

$y the )a2or ener%y-i)portin% states to their principa! supp!iers. +oth the nited *tates and &hina( "or ea)p!e( have stepped up their de!iverieso" ar)s and eIuip)ent to oi!-producin% states !ie An%o!a( i%eria( and *udan in A"rica and( in the &aspian *ea $asin( Aer$ai2an( aahstan(

and yr%ystan. The nited *tates has p!aced particu!ar e)phasis on suppressin% the ar)ed insur%ency in the vita! i%er De!ta re%ion o" i%eria(,here )ost o" the countrys oi! is producedG +ei2in% has e)phasied ar)s aid to *udan( ,here &hinese-!ed oi! operations are threatened $yinsur%encies in $oth the *outh and Dar"ur. Russia is a!so usin% ar)s trans"ers as an instru)ent in its e""orts to %ain in"!uence in the )a2or oi!- and%as-producin% re%ions o" the &aspian *ea $asin and the ersian 8u!". ts ur%e is not to procure ener%y "or its o,n use( $ut to do)inate the "!o, o" ener%y to others. n particu!ar( Mosco, sees a )onopo!y on the transportation o" &entra! Asian %as to Europe via 8apro)s vast pipe!ine

net,orG it a!so ,ants to tap into rans )a))oth %as "ie!ds( "urther ce)entin% Russias contro! over the trade in natura! %as. &he danger( o"

course( is that such endea/ors ( multiplied o/er time( will pro/oke regional arms races( e:acerbate

regional tensions( and increase the danger o* great0power in/ol/ement in any local con*licts that

erupt. 7istory has all too many e:amples o* such miscalculations leading to wars that spiral out o*

control. Thin o" the years !eadin% up to or!d ar . n "act( &entra! Asia and the &aspian today( ,ith their )u!tip!e ethnic disorders and

%reat-po,er riva!ries( $ear )ore than a %!ancin% rese)$!ance to the +a!ans in the years !eadin% up to 1914. ?hat this adds up to is

simple and soberingF the end o* the world as youI/e known it . n the new( energy0centric world we

ha/e all now entered( the price o" oil will dominate our li/es and power will reside in the hands o* those

who control its global distribution. n this ne, ,or!d order( energy will go/ern our li/es in new ways and on

a daily basis. t ,i!! deter)ine ,hen( and "or ,hat purposes( ,e use our carsG ho, hi%h or !o,5 ,e turn our ther)ostatsG ,hen( ,here( or

even i"( ,e trave!G increasin%!y( ,hat "oods ,e eat %iven that the price o" producin% and distri$utin% )any )eats and ve%eta$!es is pro"ound!ya""ected $y the cost o" oi! or the a!!ure o" %ro,in% corn "or ethano!5G "or so)e o" us( ,here to !iveG "or others( ,hat $usinesses ,e en%a%e inG "ora!! o" us( ,hen and under ,hat circu)stances ,e %o to ,ar or avoid "orei%n entan%!e)ents that cou!d end in ,ar. This !eads to a "ina!

o$servation: &he most pressing decision *acing the net president and Congress may be how best to accelerate

the transition *rom a *ossil0*uel0based energy system to a syste) $ased on c!i)ate-"riend!y energy alternati/es.

http://detnews.com/apps/pbcs.dll/article?AID=/20081103/AUTO01/811030343


http://www.tomdispatch.com/post/174919







&urn0 Auto industry creates cleaner en/ironment; spillo/ers and inno/ations

?9E 12 a!! *treet Courna! RE** RE@EA*E Cune #1( #01#( =:#= a.). EDT Environ)enta! and Ener%y Eperts @aud e, Auto Enthusiast

e$site &ars'"&han%e.co) http://,,,.)aret,atch.co)/story/environ)enta!-and-ener%y-eperts-!aud-ne,-auto-enthusiast-,e$site-carso"chan%eco)-#01#-0>-#1

7&he American public is embracing *uel e**iciency and the auto industry is responding with new

technologies and new /ehicles that use less gas( or get us there oil0*ree(7 says Ann Mesnio""( director o" the

*ierra &!u$s 8reen Transportation &a)pai%n. 7&ars o" &han%eTM5 is the ri%ht resource at the ri%ht ti)e to he!p A)ericans understand thesechan%es( and to he!p navi%ate these chan%es and )ae decisions a$out the $est vehic!es.7 Ro!and ,an%( Transportation ro%ra) Director "or the

atura! Resources De"ense &ounci! RD&5( adds: 76or too !on% the auto industry and environ)enta!ists have $een at !o%%erheads. +ut today( the 8.9. auto industry has become an agent o* change *or *uel e**iciency and clean cars. ?e ha/e an

unprecedented opportunity to work together to keep this country mo/ing *orward on inno/ation(

,obs( and a cleaner( healthier en/ironment. &ars'"&han%e.co)TM5 can p!ay an i)portant ro!e in conveyin% ho, this process

is un"o!din% throu%h the cars( the techno!o%ies( and the dia!o%ues it "eatures.7



A& Koreign Cars Kill0n

Koreign cars in the 8.9. do not help the American auto sector.

*tephen C. Collins( ?-1#-2$$'( resident o" Auto)otive Trade o!icy &ounci!( 6orei%n Auto artsurtin% * ndustry(F Detroit 6ree ress( http://,,,."reep.co)/apps/p$cs.d!!/artic!eJADV/#00>0?1#/''04/>0?1#033;/10>=/'' ,ant to co))end you "or an interestin% and in"or)ative report: 76orei%nJ A)ericanJ Auto parts %o %!o$a!: .*. cars add content "ro) othercountries7 May ;5. The artic!e cited an i)pressive a)ount o" data on the do)estic content o" various auto co)panies. +ut do have a pro$!e),ith an overa!! sense a reader )ay have %otten that there is not )uch di""erence $et,een the do)estic sourcin% o" the Detroit-$ased co)panies

and that o" Capanese auto co)panies( or that transition is 2ust a hea!thy restructurin% o" the $usiness. sin% your nu)$ers( the a/erage

,oint domestic content o* cars and trucks sold in the 8 nited 9 tates by !( Kord and aimlerChrysler

came in ,ust under $% ( compared with B% o/erall *or &oyota. Kar *rom being unimportant( this

phenomenon is ha/ing a huge and destructi/e impact on the 8.9. auto0parts industry and the 8.9.

manu*acturing base. &his di**erence translates into tens o* billions o* dollars in contracts and

hundreds o* thousands o* ,obs( or lost ,obs( in the 8.9. auto0parts industry . t is one )a2or reason "or the

intense pressure .*. auto-parts co)panies "ace in todays hyperco)petitive .*. )aret. es( Toyota and the other Capanese co)panies ,ith

p!ants in the nited *tates are $uyin% )ore parts !oca!!y. +ut Eapanese automakers are also still e:porting more than a

million and a hal* cars and trucks to the 8 nited 9 tates e/ery year with essentially -ero domesticcontent. And the cumulati/e impact o* these trends o/er the past *i/e to 1$ years is creating a deep

and pain*ul hole in the industrial underpinning o* the 8.9. auto0parts industry . &imes are changing.

)ut some *acts remain( and one is that aimlerChrysler( Kord and !( by any measure( are still

the backbone o* the 8.9. auto0parts industry.

http://www.freep.com/apps/pbcs.dll/article?AID=/20060512/OPINION04/605120337/1068/OPINION






A& lobali-ation

8.9. has the highest0technology *or manu*acturing; secures *uture *or the 8.9. industry

NRC u$!ished Au%ust 9( #012 0;:09 AM http://,,,.enn.co)/$usiness/artic!e/44;;9 The atura! Resources

De"ense &ounci! RD&5 is an internationa! nonpro"it environ)enta! or%aniation ,ith )ore than 1.3 )i!!ion

)e)$ers and on!ine activists. *ince 19;0( our !a,yers( scientists( and other environ)enta! specia!ists have ,oredto protect the ,or!ds natura! resources( pu$!ic hea!th( and the environ)ent. RD& has o""ices in e, or &ity(ashin%ton( D.&.( @os An%e!es( *an 6rancisco( &hica%o( @ivin%ston( Montana( and +ei2in%.

ith the !aunch o" ne, "edera! vehic!e "ue! econo)y ru!es on!y a$out one ,ee a,ay( the American auto

industry has grown by nearly a Duarter million ,obs "23'('$$# since Eune 2$$B when the auto

industry hit bottom( accordin% to a ne, report avai!a$!e "ro) Drivin%8ro,th.or%. The report "ro)Drivin%8ro,th.or% http://,,,.Drivin%8ro,th.or%5 "inds that "ue! e""iciency is a )a2or "actor $ehind the %ains in

.*. auto 2o$s. A website that tracks the re/itali-ation o* the 8.9. auto industry ( ri/ingrowth.org is

sponsored by three leading 8.9. en/ironmental organi-ations F The atura! Resources De"ense &ounci!(the ationa! i!d!i"e 6ederation( and the Michi%an @ea%ue o" &onservation Boters Education 6und.

!anu*acturing o* motor /ehicle and parts has grown by 1'G(1$$( or 2'. percent since Eune 2$$B.

Another H1(G$$ ,obs ha/e been added at 8.9. auto dealerships. Automakers( their suppliers and

their dealers are now looking ahead to a brighter *uture a*ter the dark days o* the recession.Ea)p!es o" ho, "ue!-e""iciency standards are acce!eratin% the auto industryNs recovery in the .*. inc!ude the"o!!o,in%: Michi%an -- 3?(#00 ne, auto )anu"acturin% 2o$s since Cune #009 ,hen the auto industry hit $otto)(accountin% "or ha!" o" the stateNs tota! 2o$ %ains over the sa)e period. n *a%ina,( Michi%an( "or ea)p!e(auto)otive supp!ier has added >?0 2o$s and ,i!! retain an additiona! 1(000 2o$s "or production o" e!ectric po,ersteerin% co)ponents E*5 "or .*.-)ade picup trucs. E*( ,hich rep!aces a )ore "ue! intensive hydrau!icsyste)( can $oost "ue! econo)y $y 4->percent on a typica! vehic!e. ndiana -- 19(=00 ne, auto )anu"acturin% 2o$ssince Cune #009 ,hen the auto industry hit $otto)( accountin% "or over one third o" the stateNs tota! 2o$ %ains overthe sa)e period. n 8reens$ur%( ndiana( onda is investin% H40 )i!!ion and ,i!! hire 300 ne, ,orers as itsndiana "aci!ity $eco)es the so!e %!o$a! producer o" the "ue!-e""icient onda &ivic hy$rid. t ,i!! $e eported to)arets around the ,or!d "ro) ndiana. 'hio -- 11(300 ne, auto 2o$s since Cune #009 ,hen the auto industry hit $otto)( accountin% "or one Iuarter o" the states tota! 2o$ %ains over the sa)e period. n arren( 'hio( 8enera!Motors is runnin% three shi"ts at its @ordsto,n Asse)$!y p!ant( addin% 1(#00 2o$s and e)p!oyin% 4(#00 tota!,orers to produce the hi%h-)i!ea%e &hevy &rue( ,hich achieves 4# )i!es per %a!!on M85 in the Eco&rue

)ode!. 79etting strong *uel e**iciency standards means we are sending more o* our energy dollars to

the !idwest( not the !iddle +ast said &i**any ngram( !idwest ad/ocacy director *or NRC.

lobal automakers are now sourcing their most ad/anced( high0tech manu*acturing here in the

8nited 9tates( creating a more sustainable and secure *uture *or 8.9. industry and 8.9. workers.






A& 7ealth<besity

<besity doesnt cause mass death @ their studies are wrong

5alas- $G Ro$ert( *enior Editor( i!! Risin% &hi!dhood '$esity Decrease .*. @i"e EpectancyJF( opu!ation Re"erence +ureau( May(

http://,,,.pr$.or%/Artic!es/#00?/i!!Risin%&hi!dhood'$esityDecrease*@i"eEpectancy.aspJpV15

De)o%raphers De$ate the @i)its to @i"e Epectancy +ut other de)o%raphers say the '!shansy tea)s study si)p!i"ies theco)p!e interp!ay o" "actors that have "ue!ed #0th century %ains in !i"e epectancy in the nited *tates and other

deve!oped countries. These ana!ysts a!so characterie the study as part o" a de)o%raphic paradi%)Qassu)in% a $io!o%ica! !i)it to !i"e epectancyQthat trends since 19?0 have cast into dou$t. 7ts a Ma!thusianea)p!e o" $e!ie" in the "iity o" nature(7 says *a)ue! reston( pro"essor o" de)o%raphy at the niversity o" ennsy!vania and the

author o" a re2oinder to the '!shansy study in the sa)e issue o" the e, En%!and Courna! o" Medicine. 7Their notion is that ,e ,ear out and die

and theres nothin% to $e done a$out it. The "act is that ,e have $een very success"u! at postponin% death at o!dera%es( and other countries have $een even )ore success"u!. ts o$vious that ,e shou!d epect the !i"e epectancy =#U that Capan has achieved.7

7Many de)o%raphers no, accept that the biological ma:imum is not so well set(7 adds &hristine i)es( a socio!o%ist at

*yracuse niversity. 7The surviva!U curves are no, $ein% pushed outQ)ore peop!e are !ivin% past 100( and )ore

past 110. There )ay $e so)e )ai)u)( $ut its pretty "ar out there( past 1#0.7 reston )aes three additiona! points inde"endin% conventiona! !i"e epectancy pro2ections: that decreases in the rate o" death at o!der a%es in the

nited *tates have $een constant since 19?0( that etrapo!atin% "ro) past trends has provided the $est "orecasts( an d

that conventiona! pro2ections have already incorporated the recent rise in o$esity rates. 7e shou!d do ,hat ,e can

to reduce !eve!s o" o$esity(7 reston says. 7+ut there are no !on%-ter) studies o" the e""ect o" chi!dhood o$esity on !on%-ter)

)orta!ity. And the c!ai) this is %oin% to o""set a!! the "actors ,orin% to increase !i"e epectancy and resu!t in a

reduction o" !i"e epectancy is inaccurate.7 *uch "actors( he says( )i%ht inc!ude %enetic en%ineerin%( a continuin% dec!ine in the rates o"

in"ectious diseases and s)oin%( and chan%es in pu$!ic $ehavior( such as increasin% condo) use a)on% %roups hit hardest $y B/AD*.'!shansy( ho,ever( ar%ues that "uture )edica! advances ,i!! principa!!y $ene"it o!der peop!e and on!y incre)enta!!y $oost !i"e epectancy.7eve sIueeed a$out as )uch !on%evity per person at youn%er a%es throu%h science as ,e can(7 he says. 7&hi!d o$esity ,i!! in"!uence ear!y-a%e)orta!ity( and therein !ies the di""erence. Any ti)e you %et one o" these pu!se eventsQ,ar( in"!uena( o$esity( AD*Qit a""ects ear!y-a%e

)orta!ity disproportionate!y.7 'thers dispute the '!shansy studyIs methods. 7*o)e peop!e have tried to "orecast the "uture o"

)orta!ity $y %ettin% $est %uesses "or each cause and then tryin% to asse)$!e the) into an overa!! pro2ection( $ut that )ethod has never ,oredvery ,e!!(7 says Richard *u)an( associate director o" $ehaviora! and socia! research at the ationa! nstitute on A%in%. 7The )i o" "actors at

p!ay is too !ar%e( and theres too )uch interre!ation a)on% the).7 And i)es( ,ho studies the e""ects o" o$esity on hea!th and "unctionin% in !ater

!i"e( says the study has no empirical analysis o" the speci"ic e""ects o" chi!dhood o$esity. 7'!shansys approachis pretty simplistic Qyou cant 2ust etrapo!ate "ro) current death rates $y o$esity status(7 she says. 7Those rates

arenIt ,ust based on obesity alone( $ut on other "actors as ,e!!.7 The ne, &D& study has a!so raised Iuestionsa$out '!shansys conc!usions. hi!e it says that o$esity i!!ed a!)ost 11#(000 peop!e in the nited *tates in #00#( it a!so

conc!udes that $ein% )ere!y over,ei%ht havin% a +M o" #?-305 is associated ,ith a !o,er rate o" )orta!ity than that

o" under,ei%ht peop!e( especia!!y a"ter a%e ;0. +ut '!shansy is unconvinced that o$esity is !ess o" a dan%er( pointin% out that )any recentstudies point out ,hat he ca!!s a 7start!in%7 rise in dia$etes rates.

No scienti*ic e/idence *or their claims

)asham and 5uik $' atric( Director [ De)ocracy nstitute( and Cohn( ea!th o!icy riter( 6our +i%( 6at MythsF( The Te!e%raph(

11-#>( http://,,,.te!e%raph.co.u/ne,s/une,s/1?3?1;>/6our-$i%(-"at-)yths.ht)! 5

et the o$esity epide)ic is a myth )anu"actured $y pu$!ic hea!th o""icia!s in concert ,ith assorted acade)ics and

specia!-interest !o$$yists. These crusaders preach a ser)on consistin% o" "our o$esity )yths: that ,e and our chi!dren are "atG that

$ein% "at is a certain recipe "or ear!y deathG that our "atness ste)s "ro) the )anu"acturin% and )aretin% practices o" the "ood

industry hence '"co)s recent!y announced $an on 2un "ood advertisin% to chi!dren5G and that ,e ,i!! !en%then our !ives i" on!y ,e eat !ess and

!ose ,ei%ht. The trou$!e is( there is no scienti*ic e/idence to support these myths. @ets start ,ith the )ytho" an epide)ic o" chi!dhood o$esity. The 2ust-pu$!ished ea!th *urvey "or En%!and( #004 does not sho, a si%ni"icant increase in the

,ei%ht o" chi!dren in recent years. The Depart)ent o" ea!th report "ound that "ro) 199? to #003 there ,as on!y a one-pound increase in

chi!drens avera%e ,ei%ht. or is there any evidence in c!ai)s that over,ei%ht and o$ese chi!dren are destined to $eco)e over,ei%ht and o$ese adu!ts. The Thousand 6a)i!ies *tudy has researched 1(000 e,cast!e "a)i!ies since 19?4.Res earchers have "ound !itt!e connection $et,een over,ei%ht chi!dren and adu!t o$esity. n the study( "our out o"

"ive o$ese peop!e $eca)e o$ese as adu!ts( not as chi!dren. There is not even any co)pe!!in% scienti"ic evidence to support

http://www.telegraph.co.uk/news/uknews/1535176/Four-big,-fat-myths.html






the 8overn)ents c!ai) that chi!dhood o$esity resu!ts in !on%-ter) hea!th pro$!e)s and !o,ers ones !i"e epectancy. n "act( the

opposite )ay $e true: ,e cou!d $e in dan%er o" creatin% a %eneration o" chi!dren o$sessed ,ith their ,ei%ht ,ith the conseIuent ris o" eatin%disorders that rea!!y do threaten their hea!th. *tatistics on the nu)$ers o" chi!dren ,ith eatin% disorders are hard to co)e $y( $ut in the * it isesti)ated that 10 per cent o" hi%h schoo! pupi!s su""er "ro) the). Recent studies sho, adu!ts atte)pts to contro! chi!drens eatin% ha$its resu!t inchi!dren eatin% )ore rather than !ess. arenta! "in%er ,a%%in% increases the !ie!ihood that chi!dren deve!op $ody-i)a%e pro$!e)s as ,e!! aseatin% disorders.



A& 79R )etter

Cars are better than the high speed rail @ en/ironment and e**iciency

5e/inson 1$ Econo)ic Deve!op)ent )pacts o" i%h-speed rai! David @evinson May #;( #010 R +raun-&T* &hair o" Transportation

En%ineerin%G Director o" et,or( Econo)ics( and r$an *yste)s Research 8roupG niversity o" Minnesota( Depart)ent o" &ivi! En%ineerin%(

http://neus.u)n.edu/apers/Econo)icDeve!op)ent)pacts'"*R.pd"

That said( re)e)$er that rea! *R not the short ter) i)prove)ents to %et to 90 or 110 M( ,hich )ay or )ay not $e a %ood thin%(

$ut are certain!y not *R5 is a !on% ter) dep!oy)ent ( so it needs to $e co)pared ,ith cars 10 or #0 or 30 yearshence( and the air transportation syste) over the sa)e period. Cars are getting better *rom both an en/ironmental

perspecti/e and *rom the perspecti/e o* automation technologies. The DARA r$an &ha!!en%e vehic!es need to $e

$ested to 2usti"y *R. &ars driven $y co)puters( ,hich ,hi!e soundin% "ar o"" is techno!o%ica!!y Iuite near( shou!d $e a$!e toattain re!ative!y hi%h speeds thou%h certain!y not *R speeds in )ied tra"bc5. 6urther they )ay )ove !ess )ateria! per passen%er

than *R trains are heavy5( and so )ay net !ess environ)enta! i)pact i" e!ectrica!!y po,ered. Aviation is i)provin% as ,e!!(

$oth in ter)s o" its environ)enta! i)pacts and its e"bciency. *ocia!!y-constructed pro$!e)s !ie aviation security or con%estion can $e so!ved "or"ar !ess )oney than is reIuired "or any one hi%h-speed rai! !ine.



A& No Kunding &radeo**s

&here are *unding tradeo**s *or in*rastructure

Amekud-i et al $1 [ .D. Transportation *yste)s n"rastructure5 *choo! o" &ivi! K Envir. En%ineerin% 8eor%ia nstitute o"

Techno!o%y Ad2o( App!ication o" *hort"a!! Ana!ysis and Maro,it Theory in nvest)ent Tradeo"" Ana!ysis "or &o)petin% n"rastructure:

sin% ER* and +A* "or nte%rated Asset Mana%e)entF( ?th nternationa! &on"erence on Mana%in% ave)ents(http://,,,.pave)ent)ana%e)ent.or%/&M"i!es/#0010=;.pd"5

n asset )ana%e)ent( we are concerned with at !east "our di""erent !eve!s o" tradeo** ana!ysis. Three o" these are used when we

independent!y manage di**erent types o* in*rastructure( "or ,hich ,e are concerned ,ith ana!yin% tradeo""s to ans,er the

"o!!o,in% Iuestions #5: 15 n ,hat "aci!ities )ust ,e investJ #5 hen )ust ,e invest in these "aci!itiesJ 35 n ,hat types o" i)prove)ent actions)ust ,e investJ hen ,e atte)pt to provide inte%rated )ana%e)ent "or non-ho)o%eneous "aci!ities( ,e are concerned ,ith another i)portant

Iuestion: hat relati/e le/els o* in/estment should we make in each o* the co mpeting *acilities point and

net,or5J 6or inte%rated asset )ana%e)ent( this additional in*ormation is necessary to increase or atte)pt to )ai)ie5 the

overa!! va!ue o" our co!!ective assets( in the conte:t o* constrained budgets. To $e )ore e""ective there"ore( an integrated

asset )ana%e)ent system must pro/ide guidance on appropriate le/els o* in/estments *or competing

in*rastructure *acilities( "or the purpose o" )aintainin%( increasin% or )ai)iin% the co!!ective va!ue o" these assets over ti)e.

http://www.pavementmanagement.org/ICMPfiles/2001087.pdf)//RK





A& 8.9. Auto Not ey

89 autos key to global market

Bive hosal March #01$ &o)petition and nnovation in the * Auto)o$i!e Marethttps://,,,.cesi"o-%roup.de/porta!/pa%e/porta!/&6O&'6/&6O&'6O#010/&on"-a)10-8o!!ier/&on"-a)10-papers/a)10O8hosa!.pd" The paperNs centra! o$2ectives are to ea)ine the nature o" co)petition and innovation in

the * auto)o$i!e )arets over a !on% period o" ti)e( 19>9 to recent years. &he 89 has had one

o" the highest per capita incomes in the ,or!d( a re!ative!y large population( and lack o* public

transportation. &hese *actors in combination ha/e resulted in a relati/ely high demand *or

automobiles current!y the * avera%es a$out ##< o" %!o$a! sa!es5( and a )aret ,here a!)ost

a!! the )a2or "ir)s in the ,or!d see to co)pete "or )aret share and pro"its. The * has a!sohad a re!ative!y open )arets( a!!o,in% entry $y a ,ide ran%e o" "orei%n producers. n a sense(

the 89 market ser/es as a microcosm o* the global automobile market( and the dynamics in

89 market ha/e implications *or the global industry .

89 auto industry bolsters healthy economy0 contributes in many ways

Sino 1$ en( Apri! ##( The Detroit +ureau( http:/,,,.thedetroit$ureau.co)/#010/04/u-s-auto)o$i!e-

industry-)aes-?00-$i!!ion-do!!ar-contri$ution-to-the-econo)y/( .*. Auto)o$i!e ndustry Maes H?00+i!!ion Do!!ar &ontri$ution to the Econo)yF( **5

The 8 .9. auto industry pro/ides a substantial contribution to 8.9. economic health( accordin% to the !atest

study re!eased this )ornin% $y the *ustaina$!e Transportation and &o))unities %roup at the &enter "or Auto)otive Research &AR5. The non-

pro"it research or%aniation !ooed at the economic and employment impact o* automakers ( parts suppliers( and

dealerships in contributing to the economies o* all G$ states . &he automoti/e industry spends M1' to

M1 billion dollars a year on research and product de/elopment( hal* a trillion dollars on employee

compensation( and is the ma,or leader o* the o/erall manu*acturing contribution to the gross

domestic product. t is di""icu!t to i)a%ine )anu"acturin% survivin% in this country ,ithout the auto)otive *ector( said i) i!!( director

o" the *ustaina$!e Transportation and &o))unities %roup at &AR( and the studyNs !ead. f&he industrys impact is huge on a

host o* other sectors as di/erse as raw materials( construction( machinery( legal( computers and

semiconductors( *inancial( ad/ertising( health care and education. n this ti)e o" nationa! introspection concernin%

the va!ue o" the .*.-$ased auto industry( it is clear the /alue is Duite high( i!! said. The study ,as ,ritten $y i!!( De$ Men(

pro2ect )ana%er( and Ada) &ooper( research associate. The co)p!ete study is avai!a$!e at ,,,.car%roup.or%. fThe &AR study resu!ts provide

stron% evidence o" the deep vertica! and horionta! inte%ration o" the 8.9. auto industry ,ith so )uch o" the .*. econo)y( said

*ean McA!inden( eecutive vice president o" research and chie" econo)ist at &AR. fThe study a!so illustrates the high

producti/ity potential o" the .*. auto industry and the importance o* its role in leading the 8.9. economy in

the current reco/ery. This study de"inite!y proves that "edera! assistance to the industry !ast year ,i!! produce )any $ene"its in 2o$s(

inco)e( and pu$!ic revenues "or years to co)e( said McA!inden. 6or the study( the authors assu)ed: Behic!e )anu"acturers 'EM5 direct!y

e)p!oyed 313(000 peop!e nc!udes )anu"acturin%( research and deve!op)ent( headIuarters( and a!! other operationa! activities ''($$$

people were employed in the automoti/e parts sector nc!udes a percenta%e e)p!oy)ent "ro) ru$$er( p!astics( $atteries(

and other non-auto)otive sectors H3H($$$ people were employed in the dealer network se!!in% and servicin% ne, vehic!es

1(;3>(000 peop!e ,ere e)p!oyed in the entire industry The study sho,s that these 1.; )i!!ion direct 2o$s contri$ute to an esti)ated = )i!!ion tota! private sector 2o$s More than H?00 $i!!ion in annua! co)pensation and More than H;0 $i!!ion in persona! ta revenues There"ore( the e)p!oy)ent)u!tip!ier "or 'EM activities is 10( ,hi!e the e)p!oy)ent )u!tip!ier "or the entire industry is 4. The &enter "or Auto)otive ResearchNs )ission isto conduct research on si%ni"icant issues re!ated to the "uture direction o" the %!o$a! auto)otive industry( as ,e!! as or%anie and conduct "oru)so" va!ue to the auto)otive co))unity. &AR per"or)s nu)erous studies "or "edera!( state and !oca! %overn)ents( corporations( and "oundations.The *ustaina$!e Transportation and &o))unities %roup "ocuses its research on the !on%-ter) via$i!ity and sustaina$i!ity o" the auto industry( thesur"ace transportation syste)( and the co))unities that !ie at the heart o" $oth the industry and the syste).F



Auto ndustry best and *astest internal links to *or ,obs to grow the econ than any other

type o* transportation

!9N 11 Dee Ann Dur$in( Associated ress( http://,,,.)sn$c.)sn.co)/id/43>?;;>?/ns/$usiness-

autos/t/auto-industry-seein%-ne,-!i"e-hirin%-spree/P.T-i?@u\'CM Auto industry( seein% ne, !i"e( onhirin% spree: ndustry %ro,in% "aster than airp!ane )anu"acturers( hea!th care providers( "edera!%overn)entF A5

Oolkswagen opened a plant in &ennessee last month with 2($$$ workers. 7onda is hiring 1($$$ in

ndiana to )eet de)and "or its $est-se!!in% &ivic. eneral !otors is looking *or 2(G$$ in etroit to build the

Che/y Oolt. T,o years a"ter the end o" the 8reat Recession( the auto industry is hiring again Q and )uch "aster than the rest

o" the econo)y. As an employer( itIs growing *aster than airplane manu*acturers( shipbuilders( health

care pro/iders and the *ederal go/ernment . The hirin% spree is even )ore re)ara$!e $ecause )e)ories o" the .*. auto

industrys near-death eperience are "resh. n 2$$B( eneral !otors and Chrysler $oth %ot %overn)ent $ai!outs and entered

$anruptcy( and auto sa!es hit a 30-year !o,. n Cune o" that year( a$out '23($$$ people were employed by the auto

industry in the 8nited 9tates( the "e,est since the ear!y 19=0s. Now the *igure is almost H$$($$$( a 12 percent

increase. *a!es are $ac up( too( and automakers are hiring by the thousands to meet increased demand. 7The

$u is incredi$!e around here a$out ,hat opportunity ,ere %oin% to %et i" ,e can $ui!d a %reat product(7 says +en Ed,ards( ,ho ,ent to ,or"or Bo!s,a%en in &hattanoo%a( Tenn.( !ast year and is no, a tea) !eader on an asse)$!y !ine that insta!!s tires and seats. Ed,ards ,as ,orin%as a %enera! contractor unti! the housin% )aret dried up. e says the pay at Bo!s,a%en( ,hich starts at H14.?0 an hour( is "air and the $ene"its

are %enerous. +esides hirin% #(000 peop!e itse!" ( Bo!s,a%en "i%ures the p!ant( ,here it ,i!! )ae its ne, assat( ,i!! create 9(000 spin-o"" 2o$s

in the re%ion( inc!udin% ?00 at auto-supp!ier p!ants that are sprin%in% up near$y. *tory: &ar shoppin% that is s)art and patriotic Auto)aers are

hirin% a%ain $ecause car sa!es are risin%. Americans bought 1$. million cars and trucks in 2$$B and 11.' million

in 2$1$. This year( theyre on trac to $uy 13 )i!!ion or )ore( and auto co)panies are addin% shi"ts to )eet the de)and. 7Every$ody %ot so

!ean and )ean durin% the do,nturn that theyre tryin% to re$ui!d sta""(7 says &har!es &hes$rou%h( a senior econo)ist ,ith * Auto)otive. &he

auto industryIs 12 percent increase in ,obs compares with a $.2 percent gain *or the economy as a

whole( ec!udin% "ar)in% and ad2usted "or seasona! variation( since Cune #009. The @a$or Depart)ent reports 6riday on 2o$s %ained or !ost !ast

)onth. n a nor)a! econo)ic recovery( i)prove)ent in the housin% )aret !eads the ,ay $y creatin% construction 2o$s. +ut ho)e prices havent

stopped "a!!in%( and the construction industry has shed = percent o" its ,orers since Cune #009 Q 4;4(000 2o$s in a!!. &he gains in the

auto industry ha/e been small by comparison. )ut they do create positi/e ripple e**ects *or the

economy. &he Center *or Automoti/e Research estimates that e/ery new auto manu*acturing ,ob

leads to nine other ,obs *rom parts makers to restaurants that *eed autoworkers. *tory: 8as prices hit a

s,eet spot "or * auto)aers The auto %ains have $een ,idespread( ,ith the Mid,est the $i%%est $ene"iciary. n 'hio a!one( auto )anu"acturin% 2o$s have risen 31 percent the past t,o years( ,hi!e parts )aers in Michi%an have added near!y #0(000 2o$s. arts 2o$s are a!so up 1? percent inA!a$a)a( ,here ,orers )ae parts "or Mercedes *Bs and onda )inivans( and in entucy( ,here the &hevro!et &orvette and Toyota &a)ryare )ade. +e"ore the turnaround( ne, auto 2o$s ,ere scarce. Detroits auto co)panies had too )any "actories( hi%h ,a%es and $!oated

$ureaucratic )ana%e)ent. Co$s $e%an disappearin% in #00> and #00; as .*. auto)aers tried desperate!y to restructure. Doens o" autosupp!iers ,ere pushed into $anruptcy. Then ca)e #00=( ,hen %as prices spied and the "inancia! crisis struc. The industry !ost a!)ost one inevery "our o" its 2o$s. +y the ti)e 8M and &hrys!er %ot out o" $anruptcy( in Cune #009( the industry e)p!oyed a$out ha!" as )any peop!e as it

did in #000. *a!es and pro"its have risen ever since( and payro!!s have "o!!o,ed. !( Kord and Chrysler are all making

money *or the *irst time since the mid02$$$s and addin% ,orers to $ui!d popu!ar )ode!s !ie the reva)ped 6ord Ep!orer.

6orei%n co)panies( stun% $y the hi%h cost o" eportin% cars to the .*. ,hen the do!!ar is ,ea( are racin% to $ui!d )ore products here. *tory:ave a !eather rec!inerG need to ta! to )y )ana%er



A& 8rban 9prawl

&urn0 &he car is crucial to eDuality @ it pro/ides mobility which would otherwise be

monopoli-ed by the aristocracy

*a) a-man( #9 *epte)$er #0$G( %enera! counse! o" the &o)petitive Enterprise nstitute(Auto)o$i!ity and 6reedo)F(http://,,,."reedo)advocates.or%/artic!es/!e%iti)ateO%overn)ent/auto)o$i!ityOandO"reedo)O#00?093013;/A century and a ha!" a%o( the !e%a! scho!ar *ir enry Maine o$served that the e/olution o* human

society was a mo/ement *rom a society o* status towards a society o* contract. n traditiona! society(,hat you were depended on the circumstances o* your birth . +orn a ser"( you re)ained a ser" a!! your!i"e. )orn an aristocrat ( you remained an aristocrat all your li*e. !odern society( howe/er( is a

society o* contract( in which what you can become depends upon what you can do . n a si)i!ar ,ay( thin( )uch o" our recent history has invo!ved not 2ust evo!utionary )ove)ent( $ut a!so !itera! )ove)ent.?eI/e become a society o * *ar greater physical mo/ement . &raditionally( *or most people( where you

li/ed depended upon where you born. Aristocrats( o* course( ha/e always been able to get around (

but that was a *reedom common people did not pre/iously en,oy . ?hat is new in this century( as a

result o* the automobile ( is that physical mobility has become accessible to ,ust about e/eryone who

is *ree .

&urn0 &he car is a liberating( ethical machine

*a) a-man( #9 *epte)$er #0$G( %enera! counse! o" the &o)petitive Enterprise nstitute(Auto)o$i!ity and 6reedo)F(http://,,,."reedo)advocates.or%/artic!es/!e%iti)ateO%overn)ent/auto)o$i!ityOandO"reedo)O#00?093013;/My essentia! the)e is that the car is ,ust not another consumer item( and not ,ust a /ery important

consumer item; rather( that it is something incredibly special( something that ranks with only a

hand*ul o* other technologies that can truly be said to ha/e liberated mankind . n a sense( the car

is morally di**erent *rom most other consumer goods. t has a ma,or ethical dimension( and that is

something we are losing sight o*. Moreover ( it is this special moral *eature that accounts *or the

increasing barrage o* ideological attacks on the car.

&urn0 Attacks on the car are a worship o* go/ernment control

.C. <Rourke is a correspondent "or The At!antic( the .@. Mencen Research 6e!!o, at the &ato

nstitute( a contri$utor to )a%aines ran%in% "ro) Ro!!in% *tone to The A)erican *pectator( ov. 2$$B( Driven &rayF( http://reason.co)/archives/#009/11/03/driven-crayhy do politicians lo/e trainsJ )ecause they can tell where the tracks go. They no, ,here

every$odyNs %oin%. ts all about control. t is all about power . olitics itsel* is nothing but an

attempt to achie/e power and prestige without merit. That is the de"inition o" po!itics. oliticians

hate cars . &hey ha/e always hated cars( because cars make people *ree . Not only *ree in the sense

that they can go anywhere they want ( which bugs politicians in the *irst place( but they can mo/e

out o* the political district that the politician represents .



Cars dont cause a urban sprawl


Auto)o$i!ity and 6reedo)F(http://,,,."reedo)advocates.or%/artic!es/!e%iti)ateO%overn)ent/auto)o$i!ityOandO"reedo)O 2$$G$B3$1

3H

&hereIs is a myth that urban sprawl( and the popularity o* the /ehicles that make it possible( are the

*ault o* eneral !otorsI destruction o* urban transit systems . The c!ai) is that 8M $ou%ht up theri%hts to produce e!ectric $uses and then s,itched everyone into cars. )ut i* you go back to the history

o* that epitome o* automobile li*e( 5os Angeles( it indicates something Duite di**erent . ?hen the car

was *irst introduced ( 5os Angeles already had what was probably the best ( most e:tensi/e public

transit system in the world . t had trolleys going into ,ust about e/ery neighborhood. hat happenedwhen cars cameJ eople *ound that cars were incredibly more con/enient than trolleys . t wasnIt

that ! or the auto industry conni/ed to kill the trolley . 5A residents( who were well ser/ed by

public transit( had a huge pre*erence *or the car. t ,asnt the car that ept the tro!!ey outG it ,as thatthe tro!!ey cou!dnt co)pete ,ith the car.

Auto Industry DA

Documents

Transcript of Auto Industry DA