Categories: Andrew Coyne, Capital Read

Coyne v Wells: Mario, McGuinty and menswear

by Andrew Coyne on Friday, May 8, 2009 10:19pm - 15 Comments

In which Wells looks like he just stepped out of GQ, and I look like I just got out of jail. We discuss Mario Dumont’s possible resurfacing as a federal (and federalist?) Conservative, and Dalton McGuinty’s inability to understand basic economics, and uh, other stuff, but it’s not like any of you will be taking any of it in. It’s TV – all anyone notices is your hair.

Tags: Chantal Hébert, Christine Elliott, cowboy economics, Dalton McGuinty, ex-separatists, flat tax, hemi-demi-semi-separatists, Mario Dumont, quasi-separatists, snappy suits

More by Andrew Coyne

Dot

I’m not sure I agree with Andrew’s assertion that gov’t the world over has never been successful in picking industrb winners.

Japan Inc., and South Korean gov’t targeted conglomerates (can’t remember the Korean name for this model) seem to be worthy of consideration as possible significant exceptions – in the one sector that Ontario is reacting to – the auto industry .

RagingRanter

Dot, the Japanese government tried to force Honda out of the car industry in the early ’70s, because they had decided that Toyota and Datsun (now Nissan) would be the standard bearers of Japan’s auto revolution. Honda ended up being quite possibly the best of them all, and it did so in spite of the Japanese government’s industrial policy, not because of it. Also keep in mind that most of those “targeted conglomerates” of the 1960s and 70s became the “zombie corporations” of the 1990s, many of which plague the Japanese economy still.

Jim Rogers

Honda got around the policy by making motor bikes, the motor cycles, then trikes, then cars. Nice progression. Of course, the Japanese government at the time would not buy any vehicles from or give contracts to Honda, making Honda very efficient. Honda got into racing to build an American presence.
Dot

Well, you could be right – probably know more about it than me. Still, isn’t Toyota now the world’s biggest car company today?

And this graph is telling:
http://en.wikipedia.org/wiki/Automotive_industry#World_motor_vehicle_production

I bet similar data from the 70′s/80′s would be quite different. The big 3 were dominant, no doubt.

sf

Japan and South Korea are examples of countries copying the successful economies of other countries, which works fine when you are a developing economy trying to catch up to developed economies.

Once they became developed countries, Korea and Japan have been no better than any other involving themselves in industry. Japan wasted trillions of dollars in the 90s trying to buy their way out of a recession and failed miserably.

What Coyne is describing is developed economies copying nobody, but rather trying to be clairvoyant about the future, which has always been an abysmal failure. Governments should allow markets to decided rather than waste the money of their taxpayers.

sf

With regards to picking winners, just the act of handing money to people who have not earned that money (a subsidy in other words) is sure to be a failure.
http://www.maple-leaf-forever.com Lord Bob

If it helps, Mr. Coyne, you’re a couple days of stubble from pulling off the Danny Ocean level of “just got out of jail”.

(People still remember Ocean’s Eleven, right? Right?)

Jenn

No, we’re trying to forget. But while we’re on that subject I’ve always wanted to know–how do men go for months or years with always a three-day stubble? Do you use really dull razors or what?

sf

Funny. You can actually get one of those barber’s electric trimmers to keep the stubble the correct length.

Jean Proulx

Mario Dumont would lose any remaining credibility he has in Quebec by joining the Conservatives. Harper is completely toxic in the province after his performance the last 8 months or so. You don’t come back from that.
Al Heck Brakes

“Mario Dumont would lose any remaining credibility he has in Quebec by joining the Conservatives. Harper is completely toxic in the province after his performance the last 8 months or so. You don’t come back from that.”

Don’t worry. Mario is a shiftless opportunist and a political chameleon extraordinaire. It would be like child’s play for him to announce that he’s now a staunch federalist with sympathies to “conservatism”, whatever that means, and join the Cons. Then in a year or two he can feign outrage over Quebec not “getting it’s fair share”, go storming out of the Conservatives and back into provincial politics with renewed electability.

“Japan Inc., and South Korean gov’t targeted conglomerates (can’t remember the Korean name for this model) seem to be worthy of consideration”

I think you have to examine these countries in a historical and cultural perspective. The somewhat top-down government-managed model of their industries is actually a step towards greater freedom and away from the fascist and feudal models of the past. And culturally there are strong trends of confucianism in Korea and a kind of nationalistic gung-ho obedience in Japan which motivates a lot of people away from independent, entrepreneurial thoughts and into group-think and “team” attitudes, with the team defined as the giant, government-favored corporation, and the country itself.

When socialists like McGimpy and Harper try to impose a greater degree of fascist/feudal control over Canadian industry they are attempting to squash the natural tendencies of entrepreneurialism and self-reliance that have existed since the days of the earliest fisheries and the coureurs des bois. They’ve got the engine in reverse. If there is any historical model for their actions it is the stagnant official monopolies of New France or the corrupt boondoggles of John A. MacDonald. Tremendous political and financial opportunities (for the leaders) of course, but hardly something that the rest of you should want to be imposed on yourselves.

When considering Korea and Japan you also have to ask whether their top-down model is really any good beyond a certain point. I don’t know a lot about Korea but Japan has been stuck in a deep recession for 2 decades now because of the stubborn refusal of the government to stop picking losers and subsidizing them. Japan is also up against a demographic implosion thanks to the magical effect that the welfare state has on government spending and birth rates.

And in any case it shouldn’t be a surprise that fascist/feudal models don’t work, no matter what you think are the historical precedents. When you advocate this kind of control you are calling for government monopoly over large parts of society. It is impossible for the class of people who control the monopoly to do it well or fairly because they are both ignorant of the needs of anyone except themselves, and also (being human) they are motivated to use their vast powers for their own good and not for anyone else. That is why centrally planned economies tend to be stagnant and corrupt at best and unstable and murderous at worst. There is no substitute for freedom and personal responsibility, and any policy which does not maintain or enhance these principles should be rejected out of hand.

Dot

Still doesn’t explain why Toyota has become the world’s largest motor vehicle manufacturing group, Hyundai (5th), Honda (6th), Nissan (8th) – 2007 data, or why they should be excluded from AC’s list of examples.

http://wapedia.mobi/en/Automotive_industry?t=6.

http://carnewsandviews.com jwl

This is not meant as a complete explanation but one reason why the Oriental car companies are doing so well is that they care about interior aesthetics more than Detroit 3. Orientals care about details within the vehicle but exterior is a bit plain while Detroit 3 focus more on exterior design and horsepower but little concern about interior. Japanese/Korean vehicles are put together better and that’s what people care about because people spend way more time within the vehicle than they do standing and admiring it or taking it to racetrack.

Dot

I thought it was also because they embraced QA programs put together by J D Powers, and continuous improvement in their manufacuturing – openly accepting, in fact encouraging, input/suggestions from all levels to reduce costs and increase quality – and some of their ability to stray far outside the union/management, worker/boss western model, some suggest, had to do with some of the cultural differences A.H.B. had touched upon.

http://carnewsandviews.com jwl

Absolutely, my answer was not meant to be comprehensive by any means. I am against unions but if we are going to have them I wish they were more like union/mgmt models they use in Western Europe or Orient. They work together to achieve goals while unions in North America see their role as being more adversarial.

Toyota has a manufacturing philosophy called the Toyota Way that has 14 Principles and they readily share it with any one who is interested. Detroit 3 have tried to implement similar/same production methods but it does not work nearly as well because of the hostile union/mgmt dynamic North Americans seemingly prefer.