The 1970’s – The Rise of the Apparatchiks

A lingering hangover from an imprudent youth is an inordinate fondness for fast cars, or as they were known in that misspent youth – muscle cars. Back in that politically incorrect time, I believed the good life to be spent in the pursuit of fast cars, fast women and easy money. I have learned to my chagrin, that nothing is so hard as easy money, a mirage leading into the wilderness. And while the love of a good woman showed me the folly of a fondness for fast women, I have yet to bow before the reality of the perilous nature of fast cars, particularly in the hands of an “older gentleman”.

Having fallen under the seductive aura of Audi’s “it’s all about the driver” philosophy forty years ago, I drive an Audi. And I do like the car. It’s the third Audi I have owned during these past four decades.

But that driving experience – it isn’t what it was. My first Audi was a 1981 Model 4000. It was a “driver’s car” though its service was as a family car, making our annual Friends and Family Tour, traveling from Glendora, CA to Norfolk, NE and points in between with three small kids strapped into the back seat.

My Model 4000 was embarrassingly underpowered, with a 4 cylinder 1.6 liter. Compare this to the standard Ford LTD Land Yacht of the time with its 8 cylinder 4.9 liter engine. But with a four speed manual transmission accompanied by rack and pinion steering, I could run circles around that Ford LTD. The Audi’s MPG, not that I overly cared, smoked the LTD as well.

The Audi was a fast car, but not a muscle car. There weren’t any muscle cars around anymore in 1980. The glory days of the Chevy Super Sport, the Pontiac GTO, the Plymouth Challenger were long gone. The 1980’s version of the Chevy Corvette and Ford Mustang embarrassed their ancestry. America still made fast cars, but they only went fast in straight lines, took a long time to get there and where about as much fun to drive as a bus.

Perhaps the American car business simply reflected the culture. America in the 50’s and 60’s was the wild west, exuberant, eager to take on the world.  Innovation and design experimentation was everywhere. Unveiling the year’s new models was an EVENT!!

But then came the 70’s and something happened. A pall of grey sameness, of taking the safe conservative design route overtook the industry. The exuberance was gone. We had laughed at the VW Beetle back in the 60’s, but it was a lot more exciting than Detroit’s answer, the Ford Pinto.

My latest Audi is laden with bells and whistles, but the driving experience leaves much to be desired. My much beloved manual shifting has gone the way of the dinosaurs. Of course, one can still electronically shift, but that is like drinking Bud Light and calling it a Guinness. Masochists can still special order a manual shift, but with a 8-speed transmission, what is the point?

Instead of a 1.6 liter 4 cylinder engine, my present Audi has a 3.0 liter 6 cylinder engine. While this is a powerful engine, the experience is gone. My Audi 4000 weighed 2,150 lbs. My present Audi weighs almost three times that weight, 5,750 lbs. The 1.6 liter engine responded to the gas pedal instantly and the 4 speed manual transmission (w/5^th overdrive gear) made the car a jack rabbit. The mini-engine of my present Audi gets its outsized power thanks to a turbocharger with its characteristic turbo-lag and gazillion speed automatic transmission with its own lag.

Instead of a jackrabbit (or rather more in keeping with the metaphor – a leopard), I drive a rhinoceros.

While the driving experience is gone, there are so many more features on my present Audi – features like cup holders and Apple Play. One of the more useful features is the automatic engine kill on stopping. Every time I stop, perhaps at a red light, the engine shuts off. Of course when the light turns green, I put my foot on the gas and the engine restarts automatically.

Paraphrasing the Beach Boys, “Fun, fun, fun until his wife takes the Audi’s keys away!” As I sit with dead engine at a neighborhood stop sign, spotting a gap in the traffic and pulling into a busy arterial street requires blind trust, a trait in which I am somewhat deficient.

I could go on, but you get the idea. I do like modern cars, but the pleasure of the driving experience is gone. Perhaps that is why everyone at the stoplight is focused on their smartphone. Driving has lost its zing, we seek to find an ersatz version, free from the cloying hand of urban monotony.

The Detroit that built American cars exciting customers tried one last time in the late 1970’s. A desperate Chrysler on the verge of bankruptcy hired a “car guy” to run the company, Lee Iacocca. Detroit’s executive suites had once been populated with “car guys”, mostly engineers that loved cars. It was said of them that “these men built the cars they wanted, not what market research told them to”.

During their heyday, Detroit’s car guys had made American cars the envy of the world. GM and Ford were titans in the business world. Driving an American car in foreign cities conferred status. Intuitively, the car guys understood that while market research might come up with larger “wings” on the Chevy Impala or cupholders, it would never come up with the Mustang or the Corvette, or even the VW Beetle.

And so Lee Iacocca saved Chrysler, at least for a time. Chrysler’s K-Car series ended Detroit’s fascination with “land yachts”. He came up with the mini-van, that irreplaceable stigmata of the suburban soccer mom as well as the Jeep Cherokee igniting the SUV revolution. Lee Iacocca did what “car guys” do, he built cars people wanted.

But that brief sunburst of innovation in the 80’s at Chrysler faded and was no more. The Irish poet Thomas Moore described the tenure of Lee Iacocca at Chrysler in the 1980’s:

“’Tis the last rose of summer,

Left blooming alone;

All her lovely companions

Are faded and gone”

What happened? Well the cynical answer might be “all good things come to an end”. In this case, the 1973 Arab-Israeli War happened. Israel, overconfident after its easy victory in 1967, got caught with its pants down. Israel might have suffered catastrophic defeat, but the US stepped in and quickly resupplied Israel with the necessary equipment to recover and win the conflict.

But the Arab world in the form of OPEC was enraged. This was the straw that broke the camel’s back. For much of the 20^th Century, the US had been the world’s largest oil producer, but production dropped off badly in the 1960’s. This was when the eminent geologist, Exxon’s M. King Hubbert, declared Peak Oil. Hubbert’s theory of Peak Oil held that all the oil worth finding had been found and we would run out shortly. Such was the prestige of Exxon’s vaunted technical staff that this obvious piece of foolishness became gospel for the “experts” advising those shaping our nation’s energy policies.

But it really didn’t matter, America’s declining production was replaced by imports from the Middle East. Both Saudi Arabia and Iran were sitting on veritable oceans of the stuff and eager to sell it. Imported oil was costing $1 – $2 per barrel. Everything was hunky dory except for those scientists convinced the world was coming to an end because the oil would run out.

But inflation caused by the Vietnamese War and the Great Society programs was starting to really hurt the US economy. Then President Richard Nixon ended the Bretton Woods Agreement. Bretton Woods tied the value of the US Dollar to the price of gold. Because the US Dollar was the international currency for trade, Bretton Woods had provided the world with a stable currency since the end of WWII. The end of Bretton Woods brought a lot of upside for the United States.  Free of any external tie to a hard value but continuing to remain the world’s de facto universal currency, the US was now able to export its inflation to its trading partners. The real value of the oil produced by Mid East nations began a steady decline, but recognizing geopolitical realities they muttered in anger but accepted the new reality.

But with the brazen support of the US for Israel, the Arab members of OPEC, i.e. Saudi Arabia, took action. They embargoed oil exports to the US. With Saudi production gone, the price of imported oil went from $ 2.90 per barrel of crude to $ 12. The price of gasoline followed suit. Long lines of cars waiting to refuel at gas stations became a feature of the Nightly News. All of a sudden the gas station attendant became an extinct species and everyone learned how to fill our own gas tank.

Of course Congress needed to react, to do something. Given the profound ignorance of energy matters among the legislature, they turned to “experts” for advice on the proper action.  And as we have relearned in the past few years to our dismay, the “experts” were then and remain that subsection of scientists convinced the world was coming to an end. I suspect “experts” advising otherwise were accused of spreading “misinformation”. The concept that a free market and human ingenuity would find ways to produce the trillions of barrels known to exist in “unconventional reservoirs” didn’t offer any way for the politicians to prove their usefulness – or to reward donors.

We got Congress’s considered response to the OPEC embargo in 1975, The Energy Policy and Conservation Act (EPCA). The 1970’s was a decade of beginnings. It is not necessarily hyperbole to call it The Decade of the Birth of the Apparatchiks. The EPCA was followed by a long line of congressional idiocy in our nation’s energy markets, most notably the Dept. Of Energy and the National Energy Act. The oil embargo had been a match in a gas fume filled room. Perhaps it would have happened sooner or later anyway, but that response to American support for Israel precipitated our nation’s long descent into the chains of bureaucratic thralldom.

Maybe it was Vietnam or the Kennedy Assassination that broke our spirit. As the 1970’s went along we were no longer sure of ourselves. We began to seek the comfort of a paternal government to shield us from the vicissitudes of life. We sought security instead of freedom. Instead of a neighborly live and let live philosophy, the suburban HOA’s were born. We were worried our neighbor wouldn’t mow his lawn and took steps to ensure he did.

Docile citizens of America, we dutifully began to purchase dish washers/washing machines that didn’t clean, gas furnaces that required rocket scientists to service and automobiles whose engines began to resemble nuclear reactors. But we were saving energy. Our new “nannies” told us that rather than cleanliness, energy conservation was next to godliness.

The year 1953 saw the Outer Continental Shelf opened up to oil exploration, an area currently producing over 600 million barrels of oil per year. It also saw the publication of a rather unexceptional novel by a rather unexceptional British writer, L. P. Hartley’s The Go-Between. But the first sentence of that novel has achieved some notoriety and is appropriate to our auto industry, as well as our country, “The past is a foreign country: they do things differently there”.

And so we have lived with our invisible masters for nearing fifty years. Perhaps no business entity was a better symbol for mid-century America than General Motors. Its products were a portrait of our people and our country. One of GM’s Presidents testified before Congress saying, “What’s good for GM is good for America”. Pedants ever since have argued about what exactly he said, but everybody knew what he meant and there was little argument with what was an obvious truth.

Today General Motors is one of the walking wounded in America’s Rust Belt, though to be sure, an important cripple in those battleground states because of the Democratic Party’s dependence on union slush funds and conscripted foot soldiers. GM has gone essentially bankrupt twice, requiring federal bailouts. The next one may well be on the horizon.

Like all American car manufacturers, GM is dependent for its survival on pickups, the bigger and more expensive the better for profitability. Pickups and SUV’s are very profitable because they have exemptions from the energy czars.

The energy czars, an increasingly important arm of our invisible masters. As part of remaking the American economy back in the 1970’s, Congress created another acronym, CAFÉ (Corporate Average Fuel Economy). Occupying a mind numbing portion of the Federal Register, CAFÉ did two important things.

First and most importantly, it elevated lawyers specializing in CAFÉ regulation to the car manufacturers executive suite, displacing the engineers that had once held those offices. And secondly, it required the cars sold by a given American car company to meet certain miles per gallon (MPG) targets, targets continually ratcheted up in arbitrary and self defeating ways.

Of course when Congress takes away, it can also give. After all, what are all those lobbyists for? While anything short of a novel length explanation would be somewhat misleading, the short answer is that while Congress put domestic cars into a straightjacket virtually asphyxiating true innovation, they opened a door as well. To ensure that domestic manufacturers had a cash cow enabling their survival, pickups and light trucks (SUV’s) got both a CAFÉ exemption as well as a tariff on foreign competition.

While our betters and their facilitators, grade school teachers, endlessly sermonized on the refrain of “energy conservation is next to godliness”, the contrary nature of American consumers resisted. While everyone gave lip service to the idea of vehicles with parsimonious engines, they didn’t sell very well. Customers seemed to prefer roomier vehicles with bigger engines, something that could accommodate a family as well as outrun a bicycle.

And so today, the domestic auto industry is a misshapen amalgam of basic transportation driven by customer choice, severely constrained by regulatory fiat and subsidized by special exemptions to the federal straightjacket, which has been bastardized even more by byzantine California regulatory initiatives. While the various governments, state and federal, impose draconian constraints on our domestic car manufacturers, what the one hand takes away- the other hand gives. Loopholes and exemptions to the regulatory structure, as well as trade restrictions, keep our domestic car manufacturers alive.

Of course, all of this governmental support requires a certain obeisance to the pantheon. One is reminded of Nebuchadnezzar’s golden statue as recorded in the 3^rd Chapter of the Book of Daniel updated to modern times; “When you hear the sound of Twitter, the singing of The Squad, the symphony of the Facebook trends, you shall fall down and worship the virtue signals of the Adorables.”

GM “could be considered progressive compared to its competition”. The corporation is also in the first rank of companies contributing large sums of money to the appropriate causes, i.e. BLM, Pride organizations, etc.

GM’s CEO is of the correct gender, though mercifully neither lawyer nor activist. One of the funny things about those American businesses most closely in thrall to federal largesse is executive pay. Take for instance Charles Wilson, that late unlamented member of the bloodsucking patriarchy who has gone down in infamy for his quote about GM and America. President of a thriving and economically dominant auto company with no government dependence, Charles Wilson was paid around $600k/year. The current chief executive of GM, Mary Berra, CEO of a company becoming increasingly incidental to the American economy, of dubious financial soundness and dependent on government largesse is the highest paid auto executive of all time at $23MM per year.

And so, one is left to wonder. Does our vote really matter? How important are the representatives that we vote in or out of office? In truth, our lives are truly bounded and controlled by the faceless lawyers writing the endless pages of the Federal Register. The leaders and executives of corporations making up our system of “free enterprise” are either lobbyists seeking advantage from the governments heavy hand or specialized lawyers seeking loopholes in the byzantine mazes of the Federal Register.

Will voting for the senile Joe Biden or the buffoon Donald Trump make any difference in the circumstances of my life?