The Catalyst

Posted Friday, Sep. 05, 2014  comments  Print Reprints
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For half of the great American experiment’s history, we were not known for moving around. In our first 100-plus years it wasn’t uncommon for someone to be born, live and die all without leaving the same 8-mile radius. True, settlers moved west constantly, but always in small numbers as compared to the entire population.

Even as late as 1900, California had a smaller population than Alabama, while Oregon’s population was slightly less than Rhode Island’s. And that year we’d been migrating for 60 years in wagon trains and for three decades via the Transcontinental Railroad.

The automobile’s arrival would change all of this and much more. For most of America, the automobile and the mobility it conferred became the catalyst for everything else that was to follow. Unlike today, at the birth of the Automotive Age few seemed to take this new invention for granted.

Few Repossessions

Once the automobile was introduced and prices started falling, the aspirational dreams of all Americans started to change rapidly. The car was and still is the original “must-have” technology for the masses. And its arrival marked industry’s shift from building for other industry — such as steel for the railroads, refineries and the new high-rise office buildings — to manufacturing consumer-oriented products for individuals.

To make this happen, the public demanded and got new roads across the country; and the unskilled laborers building them quickly found that their pay now matched that of the skilled labor class. Gas stations were now needed, as the public did not like buying gasoline in five-gallon tins at the general store. An entirely new field, automobile mechanics, ultimately replaced the local blacksmith.

And banks quickly discovered that lending money on automobiles was one of the safest bets they could make. It still is. After six years of economic turmoil, the 60-day delinquency rate on car loans is only 0.6 percent, or about half the foreclosure rate on homes in the best years. Even as far back as the mid-1920s, the repossession rate on car loans barely exceeded 1 percent.

What a Difference a Car Makes

As America turned to the automobile because it expanded one’s ability to live and work everywhere one wanted, manufacturing those vehicles brought the country a new and lasting concept: the eight-hour workday. Henry Ford realized that employees would happily work three shifts in a 24-hour day instead of two 10-hour shifts that shut down his factory for four hours. Everyone benefited from Ford’s desperate need to run his factories non-stop to meet the demand for his Model T.

And no sooner did Ford do that than he focused on the possibility that one day the country would need air transportation. For it was Ford who perfected radio navigation for flight and opened the first real airline service; he failed only in attempting to create the aircraft version of the Model T.

He would make up for that by giving us the charcoal briquette for our weekend barbeques. That clean, fast substitute for wood was a byproduct of his streamlined automobile manufacturing process. Few realize that the same Kingsford charcoal you buy today comes from a company that was originally jointly owned by Henry Ford and his cousin, E.G. Kingsford.

Everywhere the automobile took hold, it was soon followed by the business creation and expansion needed not just to produce the car, but to service, repair and drive it safely. This new era in our economic society demanded auto parts suppliers, glass companies, dealerships, insurance firms that now wrote policies for motorists, more steel production, new refineries for fuel, and a more modern kind of advertising.

According to the Encyclopedia of American Business History and Biography, by the 1920s the auto industry was using 14 percent of the nation’s steel and iron, 50 percent of its plate glass, 85 percent of its rubber, 63 percent of its interior leather, and 25 percent of all available aluminum. Yet even there we found room to grow: In 1919 there was only one car owned for every 16 people. Executives believed that one day car ownership could reach almost 100 percent.

Self-Fulfilling Prophecy

Quickly, and for decades into the future, our demand for ever more automobiles meant that 11 percent of all Americans were employed in businesses that would not have existed if the automobile had never been invented. Is it any wonder that China has become an economic powerhouse today? They were 90 years late realizing what an automobile industry could do for a country’s and an individual’s economic well-being — but their economic upward trajectory over the past 15 years has mirrored, and exceeded, the United States’ from 1914 to 1929.

From inhabiting a country with only 8,000 cars on the road in 1900, in the year the stock market collapsed, 29 years later, Americans purchased 5.3 million vehicles. The idea that one day everyone would own his own automobile led one transit executive in 1926 to say that the $6 billion sunk in rail-based mass transit would end up being written off as a bad investment. By then the momentum of the auto industry was taking over everything.

Mass transit would continue to exist, just not in the forms previously known. Companies such as General Motors designed and built modern buses that cities adopted quickly; a bus route can easily be changed with population shifts, while permanent rail lines could not respond to local migrations.

Then too, as the railroads suffered from the declining passenger and freight traffic that private car ownership and the introduction of long-distance trucks caused, it would be General Motors that came to the rescue. In the 1930s GM created the diesel electric locomotive. And to think that all of this was made possible by the one conceit that, if it were financially possible, everyone would want to own a car.

Yet by the early 50s, just as the Golden Age of Automobiles started, activists were already bemoaning our cities’ massive outgrowth into suburbs. Others complained, and rightfully so, about the pollution that a nation of car owners created. Still others believed that we were spending far too much money enabling car ownership, including what it cost to build all the highways motorists were demanding.

And sure enough, at the 1970 annual governor’s convention, held at Lake of the Ozarks, the complaints tumbled out. Many were furious that the Interstate Highway System had displaced so many low-income families. Others discussed how this rush toward highways and personal automobiles had crushed mass transit in many major cities. Someone even recommended that we abolish the national highway trust by 1975 and use 100 percent of the federal gasoline taxes for mass transit. This shift in thinking was cheered loudly by activists proclaiming that the American love affair with the automobile was over.

“Don’t Fence Me In!”

Yet here we are, almost 50 years later, and people are still complaining about suburbia, clean air, mass transit and the like. Some people, unbelievably, continue to say that our automotive love affair is near an end. It’s not, of course, and surveys prove that over and over again.

For example, when asked which of their home appliances they would give up, the one thing people will hold onto is always the family car. That’s right; if forced to make a choice, families would give up washing machines, personal computers, cell phones, TVs and radios. Just not their cars.

It’s been like that for a long time: Many families bought cars when they still used outhouses in the back yard, and long before their homes had electricity. Because freedom — the idea of being able to move when and where we want to move — is something none of us would willingly give up for anyone or any reason.

© Ed Wallace 2014 Ed Wallace is a recipient of the Gerald R. Loeb Award for business journalism. He hosts Wheels, 8:00 to 1:00 Saturdays on 570 KLIF AM. E-mail: wheels570@sbcglobal.net; read all of Ed’s work at www.insideautomotive.com

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