U.S. Senator Bob Corker put carmakers in the hot seat.
As a young man fresh out of the University of Tennessee, Bob Corker drove a Pontiac LeMans or a Ford Mustang, worked in construction, and was a card-carrying union member in a union town.
These days, the Republican United States senator from Chattanooga is a television fixture for his grilling of labor leaders and top executives of Ford, General Motors, and Chrysler in congressional hearings about the bailout of Detroit's Big Three. Whether their fate will be bailout, bankruptcy, or some financial hybrid will be one of the first orders of business for the Obama administration and the 2009 Congress.
Corker, who defeated Harold Ford Jr. in the 2006 election, is likely to be a key player in any deal requiring bipartisan support. The former Chattanooga mayor and state finance commissioner, cast as a staunch anti-union figure by the United Auto Workers and some members of the national media, says he's gotten a bad rap.
"I never saw this as something that was going to develop into a confrontation between myself and the UAW," Corker says. "I was stunned that they did not agree to being competitive with Honda, Toyota, Nissan, and BMW."
February is a key month for car companies. Former President Bush extended a $17.4 billion loan to GM and Chrysler in December. By February 17th GM and Chrysler are supposed to lay out specifics as to how and when they will be competitive.
"We would be better off if we had put it in law," says Corker, who fears the UAW will seek a better deal from President Obama and congressional Democrats. He cites a UAW letter that urges members "to be sharply critical of the Corker requirements and to call for their immediate elimination once the Obama administration takes over."
In one of the more memorable television clips of the congressional hearings, Corker tells GM's CEO Rick Waggoner, "You're the problem." But Corker says he's on decent terms with Waggoner and Ford CEO Alan Mullaly as well as Nissan CEO Carlos Ghosn. Their destiny, he believes, is intertwined: "It's a misnomer that the foreign transplants want to see GM and the others do badly. There is about a 70 percent overlap on their first-tier suppliers. If one went out it would hurt the whole supply chain."
Corker says he was willing to focus wage talks only on active employees, not the so-called legacy costs of retired employees. He believes he could have made headway if UAW leader Ron Gettelfinger had met with him personally instead of sending a surrogate "who had to call him every time he turned around."
When it comes to car factories and jobs, Michigan's loss has been Tennessee's gain. Smyrna is the headquarters of Nissan North America. Spring Hill has had a GM plant since 1990. And Volkswagen is building an assembly plant in Chattanooga that will turn out 250,000 cars a year starting in 2012.
Unfortunately, Memphis, which is still the largest city in Tennessee, is a mere footnote to this story. Draw a circle with a 200-mile radius around Memphis and you will not find a single functioning car factory (Toyota's Tupelo plant has been delayed). But make the radius 500 miles, and there are a dozen car plants in Mississippi, Alabama, Tennessee, Georgia, and Kentucky.
It didn't help that the state's two senators – Corker and Lamar Alexander – hail from the eastern region. Alexander was governor when GM chose Spring Hill for its Saturn plant in 1985. As mayor of Chattanooga from 2001 to 2005, Corker used his financial expertise, development acumen, and state tax incentives to lure Volkswagen to a specially created megasite 12 miles from downtown.
But home cooking isn't the whole story. Corker served under Governor Don Sundquist, a Memphian. Sundquist's predecessor, Ned McWherter, is from Dresden in West Tennessee. And Memphis, unlike mountainous Chattanooga, has an abundance of flat land that is relatively cheap and easy to develop.
The city that calls itself America's Distribution Center and has granted more industrial tax freezes than all other Tennessee cities combined simply never got in the car game. Memphis spent its civic, political, and financial capital on sports facilities, warehouse operations, call centers, and tourism, mixed with an unhealthy dose of crime, political corruption, and stagnant leadership in city hall.
Somebody ought to hold hearings on that.