Slow Cars

The three paragraphs below are from an editorial by Elizabeth Kolbert in the December 8, 2008 issue of The New Yorker. Be sure to read through to the punch line in paragraph three.

The Secretary of Transportation’s report to Congress begins on a dark note. “Over the past year, the domestic auto industry has experienced sharply reduced sales and profitability, large indefinite layoffs, and increased market penetration by imports,” it states. “The shift in consumer preferences towards smaller, more fuel-efficient passenger cars and light trucks . . . appears to be permanent, and the industry will spend massive amounts of money to retool to produce the motor vehicles that the public now wants.” The revenue to pay for this retooling, though, will have to come from sales of just the sort of cars that the public is no longer buying—a situation, the report observes, bound to produce “financial strain.”

“To improve the overall future prospects for the domestic motor vehicle manufacturers, a quality and price competitive motor vehicle must be produced,” the report warns. “If this is not accomplished, the long term outlook for the industry is bleak.”

The Secretary’s report was delivered to Congress in 1980, a year after what may soon become known as the first Chrysler bailout. Depending on how you look at things, the report was either wrong—three years later, Chrysler returned to profitability—or prescient....