Cars and houses. Since the industrial revolution, these two phenomena practically defined American cultural identity and its impetus toward fulfilling dreams and ambitions. Who you were was what you drove, or if not your ride, then where you lived.
Now, you might say we're convulsing through the beginning of the end of the fossil fuel economy era. It's not easy, and weaning $40-or-so trillion of global gross domestic product from the planet's oil supply doesn't bode well for a very comfortable next 50 years or so. As such, Americans' cars and houses are never going to mean what they have meant.
If who we are is not what we drive and where we live, then what happens? Well, three or four or five jobs that spring from giving America its automobile manufacturing and home construction capacity become a great big question mark. How many of those jobs go away when the excess capacity goes away? How many jobs go away when U.S. households fix their balance sheets and start to live within their means?
The answer seems to be written into the plot line of the near-to-longer-term future. At BIG BUILDER, we hope we're around to see that plot take its course across the decades, and we know that some of your companies will be cast with major and minor roles in the drama.
Meanwhile, rather than having a role in some epic tale, we seem to be stuck, of all places, in the middle of a Yogi Berra line, like, “If you don't know where you're going, you might not get there.”
“Housing's going through enough of a difficult time and has its own problems,” you might say. “Why are you dragging the auto companies into the turmoil?”
We do so because the fates and fortunes of so many home building companies that emerged during the past 40 to 80 years tied closely to the nation's network of roads and auto transportation. That seems to be at least part of what's changing.
Our collective addiction to credit and our dependence on imported oil are part of what's getting corrected.
We also do so because, as we write, the hourglass deadline approaches for two of Detroit's automotive mainstays—General Motors and Chrysler—to submit business and operational plans that meet with enough Congressional approval to warrant more billions of dollars of American taxpayer support.
Word is, President Barack Obama has appointed a former Lazard Freres & Co. investment banker, Ron Bloom, to work as his top advisor on the fate of U.S. auto companies. Here's how the the Wall Street Journal describes expectations around the Bloom appointment: