Henry Ford's Offering

With auto sales in their worst slump since 1958, it hardly seemed appropriate for anyone -- let alone an auto executive -- to favor proposals that would make driving more expensive. Yet that is what Ford Motor Co. Chairman Henry Ford II is doing. He wants a 100-per-gal. hike in federal gasoline taxes, with the resulting $11 billion raised annually going to assist the poor and unemployed.

"This country's in a recession and we're in trouble," Ford said last week after chairing a meeting of the Detroit Economic Club. "The leadership in Washington has got to take some substantive stands."

The proposal immediately squared off the maverick Ford against almost everyone else in the auto industry. A Chrysler spokesman said that it was "not in the country's best interest and would increase transportation costs and add to inflationary pressures." Richard Gerstenberg, who stepped down last week as General Motors chairman, had reservations basically unchanged from a month ago, when he called proposals for a gasoline-tax increase discriminatory and a "terrible thing." He prefers a tax on imported oil that would spread the burden more evenly among all petroleum users.

Ford is concerned over mounting social unrest as unemployment rises and benefits for the jobless shrink under mounting pressure on benefit funds.

Among other things, he would have the Government use revenues from an in creased gas tax to extend unemployment compensation from 39 weeks to a full year. As he told the Detroit News in announcing his plan: "We have to think about the social consequences if things continue in the old way. You can't expect people to sell apples on the street corners as they did in the 1930s." Another reason for a high gasoline tax, though one that Ford did not mention, is that it would discourage consumption and so reduce U.S. dependence on exorbitantly priced imported oil.

Ford has yet to completely explain how his plan would funnel money from motorists into the pockets of the unemployed. Yet he feels that immediate action is necessary. "I don't know what they are thinking in Washington or whether they know we're in real trouble," he says. "There's no time left." The auto industry already is in a depression, according to Ford; he predicts sales of 8.4 million next year, down about 600,000 from projections for this year and sharply below the 11.4 million sales of 1973. Workers laid off at his company already total 39,900, with more to come.

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