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Culture War Roundup for the week of March 18, 2024

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Okay, I'll go.

The big news this weekend was that Trump had a rally and said that, should he not be elected, the U.S. auto industry would be overrun with cheap Chinese imports. He used the word "bloodbath".

The mainstream media, which we're assured rarely tells outright lies, decided to find the exact dividing line between an outright lie and "still technically the truth". You can be the judge of whether they succeeded. For just one of many examples, Joe Scarborough ran a segment where the words "Trump warns of a bloodbath for America if he loses" were emblazoned on the bottom of the screen.

Of course, if any of this surprises you in the slightest, you haven't been paying attention. It's slightly boring at this point and would be funny except so many boomers still watch that dross.

What I want to focus on is the actual substance of Trump's claim. I think that, this time, Trump is on to something. The Detroit auto industry is about to have a head-on collision with China and get absolutely wrecked.

Already, Detroit is not in good shape. The Big 3's share of U.S. auto sales has fallen from 90% in 1965 to just 44% by 2018. (I'm sure it's much lower now). It gets worse. The only reason that Detroit has done this well is a 25% tariff on foreign light trucks that was passed by LBJ in retaliation for European tariffs against U.S. chicken.

In terms of small cars, Japanese automakers have been beating Detroit for decades. For luxury vehicles, Germany has worldwide dominance. That leaves only light trucks and SUV's, where Detroit still performs well only due to tarriffs. We've sort of forgotten about Detroit since 2008. The perception is that things were bad for awhile, but then the automakers got bailed out and they're okay now, especially #girlboss CEO Mary Barra.

This isn't true. The stock prices of the Big 3 have limped along. GM, once the 2nd most valuable U.S. company, now has a market cap only 2% the size of NVIDIA. And, if the Big 3 haven't gone bankrupt again, it's only by jettisoning high-paid union labor. Michigan, once a well-off state, now ranks 39 out of 50 in household income, falling well behind former hick states like Texas and North Carolina.

Enter China.

China is already, by far, the world's largest producer of automobiles, producing about 3x as many as the U.S. Also, China can sell an EV for $10,000. While I'm sure there would need to be changes for the U.S. market, it would not be too expensive at scale. Get ready for hordes of these "shitty but good enough" cars to enter the market.

"No one will ever buy a Chinese car" you laugh, nearly dropping your monocle into your glass of cognac. I don't think this opinion can withstand serious scrutiny. Japanese cars once had a similar reputation. Nowadays, choosing to buy an American car over a Japanese one is seen as either extremely patriotic or moronic. Even if quality never improves, people still buy plenty of Kias and Hyundais. How many more would they buy if the price was reduced by 30-50%?

So let's say all of this is true. A wave of Chinese imports are coming which will cripple the U.S. auto industry. How will voting for Trump help? My gut feeling is that Trump can't save Detroit but that, unlike Biden, he'll at least try.

For most of the period of the 1980s-present, the world has been a huge beneficiary of free trade. The rich in the U.S. have grown much richer, obscenely so. But the biggest gains have been won by the working class in developing nations, especially China. Despite all that there have been losers. The biggest losers are the working class in rich nations, especially in areas that compete with China.

The traditional government solution to manufacturing being outsourced has been to offer job retraining and lots of government benefits to the affected class. But this just doesn't work. The places that have been affected by blue collar job loss are now hollowed-out shells of their former selves.

Trump will probably at least try to ban or tax Chinese cars. Is this the right thing to do? Maybe, maybe not. It will cost American consumers a lot of money, and it will depress wages in China. In aggregate, the tariffs will probably make the world a worse place. But they will help the group that has lost so much and which has been ignored and scorned for decades. The group Biden pretends to care about but which Trump actually does.

Edit: Just saw this retweeted by Crémieux:

America's most affluent metro areas in 1949: https://twitter.com/DKThomp/status/1769891112095740274/photo/1

You'll never guess who's #1.

As a car consumer: sounds great! I've been thinking about trading mine in for a while now. Excited to see what's on offer. Hell, GM already sells a truck I'd like to buy, but only in China. Maybe Chinese competition can get them to bring it over here?

Why should I, and every other car buyer, pay more money for cars so that Mary Barra can keep pulling down $30M/year?

That truck is never going to be sold in the US because, outside of you and possibly a few other people, no one is going to buy it. As much as you and other people may complain about the lack of a small, basic truck with a five speed transmission, and 2-wheel drive, there isn't much of a market for one. Most people I know who own trucks they don't need don't own whatever the current versions of the Ranger and S-10 are, they own F-150s and Siverados and Rams and Tundras. Few people actually need a truck, and those who are buying ones they don't need want big penis trucks with huge engines and high towing capacity and 4-wheel drive and and interior like a Cadillac, not some 90 hp puttmobile. They'd sell about as well as those old VW Rabbit trucks that had their fans but didn't exactly take the country by storm.

Except frontiers and tacomas sell like hotcakes, and so do ford mavericks. That little Honda truck kinda does but it definitely does enough business to keep in business. Ford rangers and dodge Dakotas have a flourishing used market.

Japs have no difficulty selling compact trucks, nor do used car dealers more generally. And point of fact when American auto manufacturers introduce compact trucks they sell very well indeed.

For some reason- probably the regulatory one avocadopanic is gesturing at- there’s simply not a lot of compact trucks being produced.

Now owning a full sized pickup truck is a status symbol, that’s true, and it’s one of the few things Detroit stays competitive at(japmobile full sized trucks don’t have quite the same cache), but I see more Nissan frontiers on the road than any other model of truck and I live in one of the top-10 wealthiest red tribe areas in the country.

I was partially being facetious, but I don't think that size is the main problem. 90 hp is going to be a tough sell, considering that there aren't many cars on the American market anymore that get less than 100. Even a base model Corolla gets nearly twice the HP. Rear wheel drive is basically a nonstarter. The only people I know who have 2wd trucks are contractors. I know people who have been looking for used small trucks for a long time, and when I worked for the Boy Scouts we'd occasionally have a work truck we were getting rid of. I remember one was available, it needed a flywheel but they'd have let it go for $200. Everyone lost interest when I told them it was 2wd, because there's nothing fun about a 2wd Ranger. And while I have no real basis for this, I'd be willing to bet that the interior is chintzy as hell. I don't think it's that people don't want smaller trucks, it's that they don't want that specific small truck.

Ah, I see. You’re correct- Americans don’t want the kinds of base model cars that are commonplace in other countries, those base model Nissan frontiers that sell so well are still a lot more luxurious than Chinese or Mexican model cars. Heck, commercial vehicles tend to be more luxurious than the average car on the street in China.

Americans don’t want the kinds of base model cars that are commonplace in other countries

Americans aren't really given the choice.

Many of the trucks I see in use commercially are much larger than they need to be for their role. Larger more expensive trucks then add to the overhead of many businesses that rely on them. You have to mow many more lawns at higher rates to move your equipment with a current year truck than a compact truck from the 1980's. Unless you needed the towing capacity the s-10 1/4 ton pickup adequate for many roles and were ubiquitous on job sites when I was a teen. We were still using 1970's Datsuns.

The interiors were spartan, I miss bench seats.

Most people I know who own trucks they don't need don't own whatever the current versions of the Ranger and S-10 are, they own F-150s and Siverados and Rams and Tundras.

There is no modern version of the Ranger and the S-10, and the used market for Rangers and S-10s is an obscenity that shows just how much Americans do want small basic trucks. A 2010 Ranger with 150,000 miles on it will easily go for $15,000. A similar Ranger with less than 100,000 miles on it can break $20,000. I saw one 2011 with 50,000 miles listed for $28,000 - and I have no doubt it has already sold.

You can buy a pretty basic Nissan frontier if you want, and in fact lots of people do.

I second @AvocadoPanic, I think that the economic incentives via CAFE standards on automakers have made superhuge trucks artificially competitive in the market.

I think you may be underestimating the degree CAFE standards have made trucks giant in the US.