David Halberstam’s The Reckoning is too long by at least a third and maybe a half: my copy is a fat mass-market paperback that should probably go on a diet, like the American companies it describes. Learning about the machinations of 1950s Japanese auto unions is both tedious after a time and yet simultaneously lacks the depth it should have. Nonetheless, the book is fascinating mostly because you could take the problems it describes, change some names and dates, republish it today, and find that its issues remain essentially the same. American car companies overproduce giant, gas-guzzling cars and then face problems when competition and market conditions turn against their profit centers. Unions and dealerships make it difficult for such companies to compete. If the major American car companies survive this round of major problems, you can expect the same set of stories in another ten to twenty years.
The book’s many portraits of the intertwining of society and business fascinate. A section on residents of Grosse Pointe, Detroit’s once ritzy suburb, says:
The people who lived in Grosse Pointe were not bored with it, for they knew of nothing else and wanted nothing else. They could not conceive of life being different or better. Billy Chapin—grandson of Roy, the first sales manager of the pioneer Old Motor Company, and son of Roy, president of American Motors—said that the trouble with the awful creamed spinach at the Grosse Pointe’s club was that just about the moment you became influential enough to have it taken off the menu, you found that you liked it.
This piece of writing is brilliant and effective: a generalization rings true in the surrounding context and the anecdote about Chapin shows the community’s wealth and insularity through the microcosm of spinach. Meritocracy hasn’t arrived in Grosse Pointe, or if it once lived there, it has since died and moved out West to Silicon Valley or back East to Boston, where startups congregate Maybe it moved offshore with factories. Wherever it went, it certainly doesn’t live somewhere whose nepotism is as smothered as its spinach.
Others anecdotes and descriptions are less successful. Forty pages later, we learn entirely too much about a manager named Don Lennox, who “[…] simply liked manufacturing, enjoyed making something more than dealing with numbers and paper.” That’s nice in small doses, but the cumulative weight of such observations makes the paperback edition stack up to more than 750 pages including the bibliography. Much of it isn’t directly sourced, but rather narrated like something from a Leon Uris novel.
The sense of heroes and villains could also come from a Uris novel, with the Japanese usually heroes and the bumbling Americans usually not. One American, W. Edwards Deming, is presented in the heroic mode, but the American companies ignore him because they’re too pleased with themselves to listen to his production improvements (contrast that with, say, Wal-Mart, which is so hard to beat because it tries ceaselessly to to lower prices regardless of what its competition is doing). According to The Reckoning, many American companies believed managers to be interchangeable, and
On that subject [Deming] was an angry man. He acknowledged that many important American business educators thought men like him were old fashioned, but he was sure he was right and equally sure there would eventually be a severe punishment for companies that failed to stress quality.
He was right, of course, but that’s much easier to say after the fact when he’s been proven right. How many would-be Cassandras sing their song and turn out just to be naysayers?
The Reckoning could just as easily be called Success is Never Final, since its major theme is that, since World War II, American car companies believed that only broad, flat, and straight highways awaited them. Their attitude and union agreements struck while the good times rolled haunted them and continue to haunt them. The only way to operate at virtually any level, whether as an individual, family, region, or society, is to ceaselessly work toward being the best. But as one achieves that success, the culture underlying it erodes, decadence grows, and soon one’s fatally stricken platform totters.
The bizarre thing about the three American-headquartered companies is that their current problems, as I write this at the dawn of 2009, have been ongoing for 30 years. And they still either haven’t ameliorated their majors problems or are restricted from doing so by their dealer networks and unions. Whichever of those two to three hypotheses is correct, it’s still incredible to consider that such a ridiculous saga continues.
Evidently I’m not the only one who finds The Reckoning depressingly fresh: searching for it and “Halberstam” on Google brings a load of hits relating it to modern problems, like Why David Halberstam’s “The Reckoning” Should Be Mandatory Business School Reading and Halberstam’s “The Reckoning” Still a Must-Read. See a pattern? More generally, Slate’s The Big Money just ran an article called RIP, MBA: The economic crisis has exposed the myth of business-school expertise, the MBA being a symbol of problems with car companies and others, while The Atlantic ran The Management Myth in 2005. The titles of those posts overstate the book’s importance and understate its length—how many must-reads about formerly contemporary issues should really be 750 pages?—but it’s certainly a useful book to skim.
“Halberstam’s ‘The Reckoning’ Still a Must-Read” says that “[Halberstam is widely] recognized for his groundbreaking work, The Reckoning…” Maybe the book broke new ground in 1986, but that it’s still relevant indicates in many ways how far we haven’t come.