The Relationship Between The NASA Space Shuttle And The Struggling Auto Industry
With all of the talk in the news about the potential failure of
U.S. automakers, many have begun to talk about the far-reaching
effects of the auto industry on the U.S. economy.
Few people realize the reach of the auto industry and how
integral it is to the whole of the U.S. economy. It has been said
that one-of-ten jobs in the United States are connected to
automotive manufacturing, sales and maintenance.
It is hard to track down with any certainty how many U.S. cities
would be directly affected by the failure of a single automobile
model, let alone an entire company or industry. To put the impact
of the potential failure of the auto companies into better
perspective, it is easier to study the economic reach of another
vehicle in which we are all familiar: NASA's space shuttle.
Manufacturing The NASA Space Shuttle
Since NASA is an enterprise of the U.S. Federal Government, its
employees tend to create reams of reports and make those reports
available online, for the person willing to hunt them down.
While a car is not nearly as complex as the space shuttle to
build, the manufacturing base behind the space shuttle is nearly
as far-reaching as the manufacturing base behind the automakers.
The space shuttle program relied upon hundreds of manufacturers,
located in 165 U.S. Cities in 32 states, with one component built
in Canada and one other component built in Paris, France.
These manufacturers create parts as small as the screws used to
hold components together, to the parts that make wings and the
shuttle fuselage. But NASA projects cannot stop with the building
of the flight components, since life support systems are also
essential to NASA missions.
Most space shuttle components were built in California and New
York, but components were also manufactured in nearly every state
in the southwestern, south-central, and southeastern U.S.,
including: California, Arizona, New Mexico, Texas, Oklahoma,
Louisiana, Alabama and Florida. Other states that filled out the
remainder of the list include: Washington, Utah, Colorado,
Missouri, Nebraska, Iowa, Tennessee, Minnesota, Wisconsin,
Illinois, Michigan, Indiana, Ohio, North Carolina, Virginia,
Pennsylvania, New Jersey, Maryland, Massachusetts, Connecticut,
Delaware, New Hampshire and Vermont.
When the space shuttle building era ended in 1988, a vast number
of companies had to return to the process of working in the
private sector to keep workers employed.
The Coming End Of The American Automotive Manufacturing Era?
The U.S. Congress is trying hard to find ways to finance a bridge
to the future for General Motors, Ford and Chrysler.
Some argue that the U.S. auto industry is handicapped by the
retirement plans it had set up for employees in past decades.
Whereas the U.S. automakers have large sums of money set aside
for the retirement of their employees, European and Asian auto
manufacturers who have set up plants in the United States do not
have the same kinds of long-term financial commitments to their
Financial gurus argue that the combination of retirement fund
commitments and UAW contracts prevent American automakers from
competing with foreign automakers on a level playing field. This
is the reason why some are suggesting that the best thing that
could happen to GM, Ford and Chrysler is to go under, and have
other companies pick up the broken pieces of these legacy auto
companies to start again from scratch.
But as shown in the NASA space shuttle example, the effects of
this outcome will have far-ranging and deep effects on the
stability of the U.S. economy.
Perhaps failure will be good for the auto business, but it seems
likely that Congress and the soon-to-take-office President Obama
will prevent this from happening.
The greater question for General Motors is whether they will be
able to survive until January 20th, when Obama takes the reigns
of the country from George W. Bush. It is rumored that GM only
has enough cash on hand to keep them afloat until December of
My gut tells me that it may be a bad idea to let any American
automotive manufacturer fail. My gut tells me that the Chrysler
bailout of the 1980's proved to be a good investment that the
U.S. taxpayer eventually got back with interest paid.
But my gut also tells me that it is a bad idea for the U.S.
government to be in the business of bailing out every company
with a hand extended to Congress. Maybe it would be best to let
the carmakers fail, so that whatever company rises from the ashes
could compete with foreign automakers on a level playing field.
In the end, whether Washington D.C. comes to the rescue of the
automotive industry, in time or not, America will survive and
eventually thrive once again.
Arlo Mooney has dedicated himself to helping people properly
manage their personal finances, by helping them to understand
the gravity of their personal financial decisions. With his
background in economics, he strives to help people understand
complex economic principles, by explaining conditions in ways
that few people have the patience or skill to do. Read more
of his work at: cash-advance-payday-loans.org/blog/