An economic slump.
Detroit and the auto industry in crisis.
The country taking a hard look at its dependence on foreign oil.
Anyone who wants to understand how we got here – again – should read this book.
The Reckoning details the birth of the Ford Motor Company, its rise, and –along with the rest of the American auto industry – stagnation, as well as the nation’s increasing dependence on a petroleum-driven way of life. He simultaneously explains the growth of Nissan, and of Japan after World War II.
The book exhaustively documents many of the major players – Ford and Nissan executives, union leaders, autoworkers, and more.
Halberstam documents how gradually, the importance of Ford’s stock price became paramount over everything – at the expense of any kind of risk or innovation.
“Paper, rather than reality was emerging from an economy like this, and illusion rather than production occupied the new manager.”
As you read Halberstam’s explanation, the systemic, institutional changes that took place seem so clear and obvious, it’s hard to believe they weren’t better understood at the time.
“Since competition within the auto industry was mild [in the post-war years in the United States], there was no impulse to innovate; to the finance people, innovation was not only expensive but seemed unnecessary. When engineers, especially foreigners, made breakthroughs like disk brakes and radial tires and fuel injection, it would be years, sometimes many years before Detroit finally went ahead and added them as either standard equipment or options. Why bother, after all? In America’s rush to become a middle class society, there was an almost insatiable demand for cars. It was impossible not to make money, and there was a conviction that no matter what the sales were this year, they would be even greater the next. So there was little stress on improving the cars.”
I think this is a must-read.