The Education of Lee Iacocca
GEWEN, BARRY
THE EDUCATION OF LEE IACOCCA BY BARRY GEWEN There would seem to be three major reasons why Ia-cocca: An Autobiography (Bantam, 352 pp., $17.95), written by Chrysler's renowned Chief Executive...
...government...
...This brings us to the one good reason to read Iacocca...
...Almost $2 million a day was being lost, and nobody could explain why...
...Don't get mad," his wife reminded him, "get even...
...Two of those reasons are bad...
...His autobiography gives him the chance to lay into his former boss with a bloodlust that might make a cockfighter squirm...
...The real question is whether private corporations, especially giant firms such as Chrysler and Continental Illinois, should have the privilege of being able to turn to the Federal government as their banker of last resort...
...Henry has never hidden his intention of having his son, Edsel, succeed him, and he believed that I stood in the way of those plans...
...Every now and then the pump has to be primed...
...With the gnawing sense that he might have unwittingly climbed aboard the Titanic, Iacocca proceeded to bring in a team he could rely on (firing 33 vice presidents in the process), and set towork.Therewere several close calls...
...Rudeness doesn't pay, the youngster observed while working in one of the family restaurants . Life isn't always fair, he realized after losing a rigged sixth-grade election...
...Elsewhere, he presents a picture of a man who was autocratic, petty, snobbish, paranoid, a playboy, and a drunk...
...On one occasion, after making a persuasive appeal on behalf of blacks, Ford remarked in private: "Those goddamn coons...
...Chrysler in 1978 was like Italy in the 1860s—the company consisted of a cluster of little duchies, each one run by a prima donna...
...New York City is a public institution, and Lockheed, rooted deep in the military-industrial complex, might just as well be...
...The use of capital for such nonproductive activities as mergers must be controlled: "Why don't we pass a law that says when you borrow money to buy somebody else and cannibalize him, the interest payments on those loans are not deductible...
...We live in a complex world...
...the government is obligated to regulate the nation's corporate behemoths for the common good...
...In short, Iacocca is one executive who urges the U.S...
...The old days are gone for good...
...The key to the entire salvage operation was $1.5 billion worth of loan guarantees Chrysler obtained in 1979 from the U.S...
...Screw everything else...
...In Chrysler's case, theargument that rightly carried the day was j obs: The country could not afford a bankruptcy that would have thrown 600,000 people out of work...
...If readers who purchased Iacocca looking for how-to-get-ahead advice are likely to be disappointed, those who bought it for the second bad reason, its dirt, receive more than their money's worth...
...See what happens to dummies who don't finish first in their class...
...Occasionally, his ideas amount to little more than support for the auto industry, and his attacks on Japan have a disquieting mercantilist ring...
...Iacocca gives the rest of us the chance to learn as well...
...As readers try to keep up with these twists, Iacocca spins on, saying first, "The most important thing a manager can do is to hire the right new people," and then," If I had to sum up in one word the qualities that make a good manager, I'd say that it all comes down to decisiveness...
...America's economic future depends upon increased cooperation among government, union and management...
...Assuming only a fraction of all this is true (and it needs to be remembered that Iacocca, a one-time friend of Ford's, knows how to be effectively self-serving), Ford stockholders have cause to be deeply concerned...
...I hate them, I'm scared of them, and I think I' 11 move to Switzerland where there just aren't any...
...to adopt an industrial policy...
...Yet additional conclusions flow from this one...
...According to Iacocca, he was called into Ford's office one day and bluntly asked to leave...
...It's just one of those things...
...When pressed for an explanation, Ford shrugged and said: "Well, sometimes you just don't like somebody...
...Upon arriving at Chrysler in November 1978, Iacocca was shocked to discover how poorly the corporation was being managed...
...Iacocca comments: "That's when I realized I was working for a real bastard...
...Workers must be involved more closely in their companies, both through profit-sharing and actual decision-making: "I want labor to understand the inner workings of the company...
...A good imagination, an instinct for salesmanship and a natural feistiness certainly did not hurt Iacocca on his road to the top...
...His account of that rescue is dramatic, compelling, even comical...
...Students and small businessmen are funded to assure equality of opportunity...
...This is true as far as it goes, and something that free-market dogmatists cannot be forced to hear too often...
...Growing up in Allentown, Pennsylvania, the son of hard-working Italian immigrants whose small fortune was wiped out in the Depression, Iacocca, it appears, could scarcely turn over a rock without learning something that would help him on the way to his first million...
...Iacocca's more straightforward plunges into didacticism are no better, only dizzier...
...Now, to his credit, he accepts some of the consequences of his efforts...
...and the conclusions he draws from his experience have a significance for all of us...
...Even in his social thinking, he remains a self-promoter...
...The truth, alas, appears to be that the key ingredients in Iacocca's rise are simply nontransferrable...
...They're sending us unemployment...
...Trade must be regulated for the sake of j obs: "While the Japanese are shipping us Toyotas, they're really exporting something more important than cars...
...nor, less attractively, did his overweening hunger for wealth, a craving so obsessive that he can still write admiringly ofa supervisor who told him: "Makemoney...
...As almost everyone knows, after leaving Ford the "author" went to Chrysler, where he succeeded in nursing a dying corporation back to a state of near-health...
...At another, a delicately balanced financial arrangement negotiated during the hostage crisis depended on the cooperation of an Iranian bank...
...What these people get for their $18, besides a cover-photo of a self-satisfied businessman who needs to do some sit-ups, is a collection of platitudes in the worst Ben Franklin tradition...
...But others whose ideology is not at stake will want to make some important distinctions...
...At present, "industrial policy" is an extremely elastic concept, covering a wide range of positions, and not everything Iacocca has to say about it is as enlightened or progressive as one might wish...
...One was an ambitious, demanding father, driven by immigrant fear to carp, when his son was spending a few weeks on Ford's assembly line in 1946 as part of an engineer-training program: "Seventeen years you went to school...
...The same book consumers who previously gobbled up volumes explaining how to look out for number one, avoid paying income taxes, make a bundle in real estate or on the misfortunes of others, and otherwise scratch the itch of insatiable greed, now apparently hope to profit from Lee Iacocca's experience in becoming the most famous corporate executive in America...
...Iacocca does both...
...Another was a strong sense of vocation: By the age of 15, Iacocca knew he wanted to be in the automobile business, and by the timehewas ready to graduate from college, he had decided to make a life at Ford...
...THE EDUCATION OF LEE IACOCCA BY BARRY GEWEN There would seem to be three major reasons why Ia-cocca: An Autobiography (Bantam, 352 pp., $17.95), written by Chrysler's renowned Chief Executive Officer "with" the journalist William Novak, vaulted to the top of the bestseller lists the day it went on sale...
...Sales were plummeting and factories were deteriorating...
...Iacocca, with his usual pugnacity, is indignant that anyone could have opposed the bailout, but in fact he is not completely convincing...
...It was his job to save Chrysler and he was ready to make use of any means available to him...
...The real reason, suggests Iacocca, was the threat to the Ford family posed by a company president who could conceivably take over the entire corporation some day as Chairman of the Board...
...A campaign issue during last spring's Democratic primaries, those loans remain a source of controversy...
...After devoting 32 years to the Ford Motor Company, eight as president of the corporation, Iacocca was unceremoniously dumped in 1978 by Henry Ford II in the most celebrated sacking since Watergate's Saturday Night Massacre...
...Nonetheless, as a former free-market capitalist, he has learned a great deal from his experience at Chrysler...
...money goes to housing and shipping on an industry-wide basis...
...In the sixth year the IRS caught up with him to the unsplendid tune of $ 11,000...
...The mind's eye imagines dozens of aspiring CEOs over the next few years hiring new people decisively...
...Two pages after declaring that "the ability to communicate is everything," he casually changes horses, advising that'' the ability to concentrate and to use your time well is everything...
...He states that Ford regularly diverted company funds for his own use, and over a period of five years paid nothing in income taxes...
...The patient is off the critical list, though not yet fully recovered...
...To add to the troubles, in early 1979 a gas shortage sent the whole auto industry reeling...
...That is about the most temperate thing Iacocca has to say on the subject of Henry Ford II...
...It's personal, andlcan'ttell you anymore...
...The free-enterprise system, he recognizes, has its limitations: "The plain truth is that the marketplace isn't always efficient...
...To Congress and to his colleagues in the corporate world, Iacocca insisted government assistance is "as American as apple pie," benefiting students, shipping companies, the housing industry, Lockheed, small businessmen, New York City, and many more...
...The most obvious is that if the fate of a company is too socially important to be left to the marketplace, then so is its conduct...
...At one point, the multibillion-dollar firm was down to its last million in cash...
...Iacocca is a practical, not a philosophical, man...
Vol. 67 • December 1984 • No. 22
