Detroit's Iacocca tells Washington how to lick adversity
New York — ''If you can find a better car, buy it.'' Lee Iacocca, chairman of the board of Chrysler Corporation, says. First Chrysler, now the country.
Last week Mr. Iacocca was in New York, telling an assembly of financial executives attending the Conference Board's annual Financial Outlook Conference what needed to be done to turn around the country - much as he has turned Chrysler around.
''President'' Iacocca, as reporters jokingly referred to him, told the bankerspresent that they had better ''wise up'' and drop their interest rates, so consumers could start to afford monthly new-car and house payments. The prime rate, Mr. Iacocca said, should fall another two to three points.
But Mr. Iacocca saved his fire for Washington. First, he shot off a one-liner suggesting that Washington would be better off under two feet of snow, since it shuts down under such conditions. Then, he quipped, ''Someone has to take away the government's charge cards.''
In his best showroom style, Iacocca reeled off the eight major government problems that he says stifle the auto industry. These were bad tax policy; bad interest-rate and deficit policy; double-digit inflation; lack of an energy policy; declining productivity; trade imbalances; stifling government regulation; and a consumer malaise, which he said was brought about by the first seven problems.
The government had only addressed the inflation problem, he said. In school, he said, the goverment would flunk out; in managment, it would be fired.
Since Mr. Iacocca can't fire anyone in government, he has taken to working with it. As he noted, recently he has been ''hobnobbing'' with President Reagan. And he thinks his efforts might be showing signs of paying off. The President, he said, is showing less inclination to listen to the supply siders, and is now considering reducing costs and increasing revenues.
The Iacocca solution, is to cut 5 percent from the defense budget, saving $15 billion, and cut 5 percent from the social programs, saving another $15 billion. Then he would add a surcharge to the price of imported oil. ''We'll keep the price of oil at $34 per barrel,'' he quips, ''even if the producers can't.'' In addition, he would tack on another 25-cents-a-gallon federal tax at the gas pump. And voila, Mr. Iacocca had explained how he would make up $70 billion of the deficit.
With the budget in better balance, Mr. Iacocca turned his attention to the industrial heartland, or as he called it, ''the industrial wasteland.'' ''We need a Marshall Plan for America,'' he intoned, suggesting it might be time to begin another Reconstruction Finance Corporation. ''We need to save businesses about to go bankrupt,'' he said, with a kind of inflection in his voice that indicated he knew what this was all about.
As for Chrysler itself, Mr. Iacocca indicated business was beginning to look better: Car buyers are again plunking down large sums for the largest cars Chrysler can make. And, they are interested in rear-wheel-drive versus front-wheel-drive cars. Most importantly, they are buying.
With the buyers back, he quipped, it could give him problems. ''I've been in first gear so long, I'm going to have trouble getting into second gear.'' And the Chrysler chief dismissed any thoughts about running for president. He's only been running Chrysler during the bad times. Now, he wants to be there for the good times as well.