President Obama with the Chevrolet Volt after a groundbreaking ceremony for a new battery plant in Holland, Mich (Photo source: NY Times)
Yesterday, Barack Obama visited the Compact Power plant in Holland, Michigan, to attend the groundbreaking of a new plant to produce battery cells for Ford and GM electric vehicles.
The $300 million facility is the ninth factory to begin construction since the administration allocated $2.4 billion from the president’s economic stimulus program toward production of advanced batteries and electric vehicles. It is one of two factories in Holland, which together have received $450,000 in grants from the U.S. government.
The factory that broke ground Thursday will employ 400 people, in 18 months. It and others like it could be a decent starting point to jumpstart economic growth in Michigan. In five years, officials say, the government subsidized plants will be making batteries for 500,000 new cars a year and will cost 70 percent less.
The Holland area happens to have a large Tea Party movement. They have come out with a mixed reaction to the government stimulus and the President’s visit. Jim Chiodo, a Tea Party leader in Holland, said that he has nothing against the jobs that the plant will provide the town. But says he doesn’t believe it’s up to the government to pick and choose which towns get help.
“For every winner, there’s 10 losers,” Chiodo says. “It’s really, really hard to take a position that’s against your hometown. And I’m not against my hometown. I love Holland. I’ve been here 25 years. It’s a great town. But it’s going to hurt towns like Holland when this gravy train gets turned off.”
If that’s all Chiodo can say to criticize the stimulus program, he’s having some trouble keeping his Tea Party cred in my book.
I’ve always been a big fan of analogies, here’s what I came up with in response to that criticism.
Is it fair for one guy on dialysis to get a kidney transplant while another guy who needs one dies because he was further down on the list? Of course not. So does that mean nobody should get a new kidney then? Take this further now, what if you knew that the guy who was lucky enough to receive the kidney was an amazing doctor who had a good chance to help prevent others from having kidney problems like his own. And, what if the only way the doctor could get the kidney fast enough to survive was with help from an arrogant, socialist, idiotic president who had no experience with kidney problems?
One could say that Holland and lot of towns in Michigan are on economic dialysis. I’m not sure how doing nothing “Tea Party style” can save it and places like it.
Question: Should the Obama administration not have helped build the battery factory in Holland, Michigan?
For an extra $5,800, buyers of a Corvette Z06 or ZR1 can go to the General Motors Performance Build Center in Wixom, Mich., and assemble their own car’s engine. Even car maintenance novices will have the opportunity to build their own engines because as part of the deal a GM technician supervises the process.
“Corvette owners are some of the most passionate—and most involved—enthusiasts in the industry,” Jim Campbell, vice president of Chevrolet marketing in the United States, said on Monday. “The Corvette engine build experience offers customers an unprecedented opportunity to participate, hands on, in creating the car.”
Now I’m not the most mechanically inclined (ironic for an editor at Today’s Machining World), but I still think that it’s a way cool idea. But why?
Why are people fascinated with doing things independently and creating things themselves? I know, some of you are skeptical of this commentary, because after all, in America we are notorious for watching copious amounts of TV, eating fast food and going to Wal-Mart to buy everything we need.
Most people reading this article do a least one of those things, but still, tons of Americans like watching reality shows about hands on topics like cooking, building customized motorcycles, and restoring houses. Americans like to go to restaurants like Big Bowl where we pay for the right to create our own Asian dishes. We go to fish hatcheries and go berry picking where we hunt and gather our own food and then pay someone for the experience. Along with that caveman phenomenon, it seems like every other American is proud to have created his or her own HD home video.
Is it human instinct to want to build and create? Or maybe even just animal instinct? I believe it is. Many people don’t create things on a regular basis because we’ve been conditioned that the ideal is for other people or machines to do things for us, whether it be cook, farm, program computers, or fix our car engines.
But if you put kids together in a sandbox, or in a room with Legos, or even in a kitchen with pots and pans, there is a good chance they will create something, be it be a structure or a story or a work of art.
I recently came across a hysterical YouTube video satirizing the screw-ups by BP management as they try to stop the oil leak in the Gulf of Mexico. In the video, a group of BP execs are sitting in a boardroom and someone spills a cup of coffee on the table. The group panics and makes blunder after blunder trying to corral the coffee. They try things as ridiculous as pouring garbage on the table, throwing wads of hair, and sucking the coffee up with a drinking straw.
I stepped back and asked myself, why did the guy spill the coffee in the video? How does an “accident” like this happen? The spill happened because the guy in the video wasn’t paying attention, he was distracted, he was relaxed about the risk of spilling the coffee.
I think back to a ski trip I took 14 years ago in Colorado when I was 16. I met this middle aged guy on the trip, who had some of the greatest stories I’d ever heard about racing stunt cars, doing illicit drugs, and traveling to dangerous places around the world. These were his words of wisdom, “Noah, it’s ok to do dangerous, crazy stuff. The important thing is to stay paranoid while your doing the dangerous stuff.” His rational was that usually the people who get hurt are the people who relax and feel like they have nothing to worry about. You get away with something risky long enough and before long you forget that it’s a big deal—be it cheating on your wife, sub-prime mortgages or faulty engineering.
Toyota’s management skimped on quality control in recent years, BP didn’t follow accepted safety protocol, Wall Streeters believed they could get away with bad bets over and over again. If the guy in the video had been paranoid about spilling the coffee he probably wouldn’t have done it.
Question: Do you think that good BP management would have been able to stop the oil spill by now?
When I wrote the blog a couple of weeks ago about Meg Whitman using her eBay wealth to win the Governorship of California while Rod Blagojevich defends his mastery of payoff culture in a Chicago courtroom, I was unconsciously touching a bigger theme—the rise of women in American life.
Hanna Rosin’s cover story in the current Atlantic—“The End of Men: How American Women are Taking Control of Everything”—brilliantly tells the story of the decline of men in 2010. Economically, this trend is related to the decline of manufacturing and construction. Current unemployment is heavily weighted toward males but the long range trends are even stronger than recession related layoffs.
Testosterone, physical strength and a gambling spirit, the traits that tamed the Old West, are not as highly valued in today’s world. Women are earning 60 percent of the college degrees now. Statistically men struggle more in school, and school is the gateway to advancement.
I think that the shift towards female dominance is less apparent in the machining world we inhabit, but I find women taking more of the purchasing agent roles. Men may still be making most of the stuff, but women are often signing the checks.
When Pierre Omidyar, founder of eBay, realized the business was getting too complicated for him to manage, his venture capital investors found Meg Whitman in Boston biding time as a consultant and brought her to San Jose to grow the business by harnessing the entrepreneurial fervor of mom and pop companies everywhere.
Meanwhile, Rod Blagojevich, who still can’t use a computer (see video below), was wheeling and dealing in the backroom of Chicago politics. His first big move was marrying a powerbroker’s daughter. He then joined the law firm of Eddie Vrdolyak, a famous fixer and Chicago dealmaker. He used his smile and big hair to charm the voters all the way to the top of the State. Very competitive, very male, very Chicago, very corrupt—our Rod.
Meg goes to Sacramento if she beats the old liberal pol—Jerry Brown, former governor of California from 1975-1983. Rod goes to prison if the wiretaps stick.
The Street.com recently interviewed John Maccarone, CEO of Textainer, a company that owns and leases more than 10,000 containers. According to Maccarone, there will be a huge shortage of containers in the coming years. The capacity of world containers declined last year because all of the container manufacturers had closed. The closings caused the companies to lose a ton of skilled labor, so now their output is less than half of what it would be in normal years.
According to Maccarone, global trade is forecast to grow by 9-10 percent next year, in contrast to 2009 during which it declined by 10 percent. Presently containers are at a 90 percent utilization rate.
Tough to get enough containers, but at least we need them.
The financial world views Greece as the hole in the Euroland dike. Riots in Athens sent the U.S. stock market down 1500 points because people feared it was the beginning of another subprime-like tsunami.
I didn’t have a good feel for Greece’s problems so I called Nick Logarakis, an old friend who had built and sold General Automotive Manufacturing in Milwaukee after emigrating to the United States from Greece following college at University of Wisconsin Madison. Nick is active in banking now and still has a hand in manufacturing through his son-in-law’s firm, Northern Gear in Franklin, Wisconsin. He maintains a home in Athens and imports Greek olive oil for fun. Nick understands Greece as a native, but has the perspective of an American businessman.
“What you’re seeing in Greece is the result of 30 years of Socialism,” he told me Friday. “Government workers get two weeks off for Easter, two weeks off for Christmas and four weeks off for summer. They get paid for two months not working,” according to Nick.
The orientation of the country is to make work. “I go in to pay a tax bill, and the clerk records the transaction on the computer, then he takes out a big ledger book and writes it down. It makes more work for the bureaucrats,” he said.
Coupled with the make-work is corruption. Companies work with two sets of books, one real and one for the tax collectors. The cash economy thrives while the country’s treasury starves
Nick says when he goes to a well-regarded doctor in Greece the expectation is that he pay 30 euros at the desk, but slip an envelope with 100 euros in cash to the doc when he’s alone.
Logarakis says in Greece you see a lot of people driving around in expensive cars, eating in restaurants and going out to clubs.
Government services cost more than the country can afford, the way they are presently being run. The European banks that hold Greek bonds are scared. Spain, Portugal, and Ireland, are in the same boat.
Now we have a new Euroland taxpayer bailout for Greece and its creditor. Take a deep breath and pass the Kalamata olive oil, please.
Question: Is the United States headed in the direction of a Greece-like debacle?
Here’s a little feel-good blog about a video I just saw on YouTube. As some of you know, the search for the next coach of the Chicago Bulls has begun. One of the guys on the shortlist is former 76ers point guard and Chicago native, Maurice Cheeks.
Along with being known as a great point guard and solid coach, Cheeks is known as just real good guy. Back in 2003, Cheeks was head coach of the Portland Trailblazers. During a pre-game, he came to the aid of a 13-year-old girl who forgot the words while singing the National Anthem, inspiring the entire stadium to join in to help. You need to check out this video on YouTube. It’ll make you proud to be an American.
Yesterday at a café in Chicago I met a guy from Venezuela. Of course one of the first things I asked him was if he was a big baseball fan. Baseball is huge in Venezuela and I figured this would be a good way to connect.
As I suspected, he was, and soon we got to talking about the difference in how baseball players begin playing in poor countries like Venezuela and the Dominican Republic verses in the United States. He told me that typically in Venezuela, kids play baseball in the street, using bottle caps instead of a ball and use a broomstick as a bat. Sometimes they also use cardboard milk cartons as gloves.
Turns out that after learning to hit a bottle cap with a broomstick, hitting a real baseball with Louisville Slugger seems like a cinch.
What does it tell us when Major League Baseball is dominated by players who come from such impoverished backgrounds that they couldn’t even afford basic equipment?
Equipment, a nice baseball diamond, money for resources—stuff—it’s overrated. These poor kids make it big because of their passion for a game they love. Or, maybe it’s just their desperate determination to overcome poverty that’s the key to their success. Probably a bit of both.
Passion, talent, desperation. Those are the necessities for success. Get those things and that other “stuff” should take care of itself.
I was shocked by the current ad campaign by Domino’s pizza in which company president, Patrick Doyle, clearly states that the pizza that made the company billions of dollars is awful. He’s changed the crust, the sauce, cheese–everything, but kept the 30 minute delivery and the price.
This is a bet the farm gamble for Domino’s, a company that started with Tom Monaghan schlepping pizzas to college students at Eastern Michigan in a Volkswagen. Monaghan became very rich, bought the Detroit Tigers baseball team and started his own law school. He bought a farm outside of Ann Arbor to house the offices and test kitchens that supported his enormous international franchise empire that sold Domino’s rather mediocre pizza. Monaghan sold out in 1998 and Domino’s is fighting Pizza Hut and Papa John’s for market share. Now Doyle comes in and proclaims the company’s core product to be crap.
The company had such chutzpa they put a link on their Web site to a clip from Steven Colbert’s the Colbert Reportin which he gives a hilarious yet stinging analysis of the product it’s known for.
What a crazy gamble. Is this New Coke or Schumpeter’s creative destruction? Will Doyle’s gamble lead the company to new heights of pizza adoration? Too early to tell, but the audacity of building a marketing campaign based on tearing down your core product is inspiring. I must admit I’ve thought of doing something like what Doyle is doing now regarding Today’s Machining World’s old Web sites. Honestly, I believe our early Web sites were mediocre, but I held my tongue. There have been many issues of TMW that had a lot of typos or poorly executed photos, but I haven’t built an ad campaign decrying past mistakes.
To err is human. To live is to fail. But to bet the company by proclaiming to your loyal customers they have been eating cheesy swill is a risk I could not stomach.
Question: Would you have the guts to do what Domino’s did?
Dear Shop Doc,
I have recently been asked if my shop does “micro” machining. I’ve done some work on small
parts recently, but I’m not exactly sure what is meant by “micro.” [...]
Today’s Machining World Archive: April 2010 Vol. 6, Issue 03
Dear Shop Doc,
We are running a long aluminum part on our CNC Swiss and have problems with the long [...]
By Mark Bos
In today’s difficult economy, we are all trying to make parts faster and cheaper. Unfortunately, making parts faster is sometimes at odds with making them cheaper.
I have learned [...]
Dear Shop Doc,
We are a new job shop looking to add some equipment. We are wondering whether we should invest in used rotary transfer machines like a Hydromat Legacy or [...]
In 2010 gold is up 6.8%, silver is up 4.8%, and copper is down 12%. In this video, Wayne Atwell, managing director of Casimir Capital, thinks copper has the most upside for the rest of 2010. This is based primarily on demand from China.
