CANDOR AND THE CAR-INDUSTRY: I OFFER MY CONDOLENCES AND SOME THOUGHTS TO FORD'S WORKERS

Having mentioned the Australian car industry in my last post - yesterday - I was shocked to hear about Ford closing operations in Victoria. But was I surprised?? That's a critical issue, and not so much a question. Without intending to offend anyone, does Victorian manufacturing risk succumbing to Detroitus, which was left behind in that once great city? It doesn't have to happen that way (ditto for Detroit), and here's why:

SOME KEY TAKE-AWAYS: REIGNITE YOUR SPARK

# Ford motor: surprise or unsurprising? Moral: change is necessary, but management’s obligation is to avoid landing workers with unpleasant surprises so far as lies in their power. Management's power is intellectual, financial and ethical. And they should utilise all sources: in fact they have an ethical obligation to do so, even if their legal duty is toward the company’s shareholders. (Cf German ‘Rhenish’ capitalism, Japan’s keiretsu and the Toyota Way).

# Globalisation is real. Those who remain in a single occupation for thirty years, as some component manufacturers did at Ford, risk obsolescence. In a global economy, risk and reward follow competitive advantage. Shareholders can emplace and remove capital at will so diversification and reinvention are crucial for workers’ job security and for industry success.

# Take your destiny into your own hands, or someone else will fulfil your destiny for you. In a global marketplace, corporate headquarters could be any place in the world. Face reality as it is when you sign onto new terms and conditions with any business. Instead of waiting on the Fates, all employees and stakeholders – executives, line managers, employees and government officials – should enable transitions with minimal disruption. In a disruptive economy (characterised by restless product and process-innovation) retraining is thus paramount and should be unending. Give people the tools to manage their own futures.

# Employers should be responsible. Treat your employees with respect at all times. If you don’t, your business assumes the reputation risk of a more ethical, creative alternative. (I am not making any observation about particular manufacturers or entities here). 

POSTCRIPT

More than any other stage, perhaps, in history, workers require introduction to the fundamentals of economic thought and history. As industries move in phases and the globe collectively considers the contours of a more human capitalism, Australians need to understand the elements of modern capitalist thinking. And the nucleus for successful transition and flourishing is embedded in the supporting family. 

In particular, I hope to review Jerry Muller's recent contribution to Foreign Affairs, "Capitalism and Inequality: What the Right and the Left Get Wrong".

Here is my list of the economists and thinkers to which Muller charitably refers (p.s. quite an extraordinary list!):

Alfred Rappaport

Hyman Minsky

Karl Marx and Friedrich Engels

Jan de Vries

Tyler Cowen

Joseph Scumpeter

Daniel Bell

Brink Lindsey

Michael Spence

Max Weber

Edward Banfield

Pedro Caneiro and James Heckman

Friedrich von Hayek

Alexander Hamilton

In the search for daily bread, always make room for food for thought... 

~~~ 

Condolences and Best Wishes to Ford workers and their families.