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A Triumph of Corporate Will: the Fiat-Chrysler Merger

Jarek Kupsc

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Humble Beginnings

  It was Benito Mussolini who said that a better name for Fascism would be Corporatism.  The term aptly describes a perfect merger of the state and industry, with the former making sure the climate for business is sound, and the latter influencing legislation and politics to its benefit.  Fiat S.p.A. (an acronym for Fabbrica Italiana Automobili Torino), the giant Italian car manufacturer, is a prime example of one corporation that benefited from such policies, and went on to dominate markets in similar political environments.

   Poland, 1993: The author's brother with a Polish Fiat 125p

   The Italian success of Fiat and its near monopoly on domestic auto market benefited directly from Mussolini's generous corporate policies of the 1920s and 30s.  On the international market, the Fiat brand was subsequently reserved for Communist and Fascist dictatorships.  Given such a pedigree, it should not come as a surprise that Fiat's merger with Chrysler coincided with the Corporate Socialist policies of the Bush and Obama administrations.  Fiat's decision to help the troubled American automaker is not a simple good-will gesture.  Not without a sense of bitter irony, the merger should be looked at as part of a larger pattern of the Italian corporation's forays into totalitarian regimes. 

   

    After World War II, due to its ties to Mussolini's fascist regime in Italy, Fiat was forced to remove the owner family from leadership.  The company produced a number of highly fuel-efficient, if small and medium-size cars, but it wasn't until 1955 when the tiny Fiat 600 (or "Seicento") revolutionized the way people thought of urban commuter vehicles.  Not only was the Seicento a huge international hit, but it also paved way for a massive licensing of the Fiat brand onto such territories as Eastern Europe and South America.

Fascist Dictatorships

    Argentina's dealings with Fiat date back to the early years of the 20th Century.  Imported Fiats were sold for decades until the first licensed Seicento was introduced in 1960, followed by other models.  Thus, through the windows of their Fiats, Argentinean drivers could witness General Juan Perón's crackdown on dissidents, censorship and torture, but also the General's overthrow and exile to Spain, decades of political unrest, violence, "disappearance" of thousands of innocent people, and some other nasty aspects of the Dirty War.  When pressed for details, some older Fiat drivers can still recall the CIA-backed Operation Condor, as well as Perón's return to power, his death, and a coup d'état, which removed his fascist wife from office, and last, but not least, the shameful defeat by the British in the Falklands War.  From then on, things started to look a little better.

    Also worth mentioning is the Spanish edition of Fiat automobiles, produced there as SEAT, during the fascist Franco regime.  It is quite possible that Juan Perón was driven to the airport in a Fiat-SEAT, on his way back to Argentina to end his 18-year exile.  In his many strange dealings, Perón was assisted by Giancarlo Valori, a Fiat executive.

Communist Dictatorships

Yugoslavia    

    In 1955, Communist Yugoslavia began its partnership with Fiat.  A version of the Fiat 600, Zastava 750, was launched under a license in 1962.  Various models, some manufactured in Poland, kept Yugoslav mechanics occupied throughout Tito's Presidency for Life.  It is rumored that a chief of secret police in Serbia fell victim to a dubious traffic incident involving a Fiat-licensed vehicle, after he started to complain about Tito's politics.  After Tito's death, it was just a matter of time before the multi-ethnic federation of Yugoslav states started to break apart.

A crushed Yugo during the Bosnian War

    Regardless of their propensity for mechanical failure, various models of Zastava vehicles became primary modes of transporting food and smuggling weapons during the Bosnian War.  Relatively low MPG offered by most Fiat-based vehicles proved highly efficient during the Siege of Sarajevo, the longest siege of a capital city in the history of modern warfare.  Despite the bombing of its factory by NATO, Zastava became a much depended-upon vehicle in the subsequent Kosovo War of 1999. (Ironically, the Allies had orders to spare slave-labor Nazi Ford factories in Germany from air raids in WWII.)  Low-income Americans still recall the mid 90s shortage of spare parts for their Yugo, one of Zastava's greatest pre-war exports.  According to an unconfirmed source, Slobodan Milošević was caught while waxing his 1982 Zastava Koral (Yugo Tempo), and subsequently brought to The Hague War Crimes Tribunal.  Also, quite possibly, the apprehension of Serbian war criminal Radovan Karadžić would not be possible had his 2003 Zastava 10 (another Fiat design) not gotten a flat tire.

The Soviet Union

    After a successful effort to rip off the Fiat 600 without a license (Zaporozhets ZAZ-965), the Soviet Union eventually entered into an official licensing agreement with Fiat in 1966. (By now Fiat's ownership had reverted back to the original family.)  It is still virtually impossible to walk onto a Russian street anywhere in the country without bumping into one version of a Fiat-based vehicle or another.  Under the name Lada, the Fiat became a car of choice for both the advantaged people and the Communist leadership (the common man had to do with a Zaporozhets).  In fact, an Italian-Soviet motion picture, The Extraordinary Adventures of Italians in Russia (1973), extolled the benefits of Fiat-Lada vehicles in a narrative that amounted to little more than an extended car commercial.  Eventually, the original Fiat blueprints were modified to fit the climate hardships and poor road conditions in Russia.  Still, the Lada was notorious for its frequent breakdowns.

    

    Lada's development parallels the history of modern Soviet Union vis-à-vis Leonid Brezhnev, another Leader for Life.  The most notable turning points in this saga include the Soviet crackdown on Czechoslovakia, forced expulsion of Jews from Russia, and a near total economic devastation of the empire precipitated by the invasion of Afghanistan.  All throughout those years the faithful Lada kept Soviet people on the go in style, if they were lucky enough to afford one.  The average waiting period for a new car could drag on for years.  Lada kept on producing Fiat-based models throughout the breakdown of its Federation in the early 1990s and continues to do so today with great success.  I dare you to take a stroll in downtown Grozny, Chechnya, without a threat of being run over by a bullet-ridden Fiat-based vehicle.

A migrant Lada in the Chechen War

It is not uncommon to see Taliban leaders drive a souped-up Lada in the rough terrain of Afghanistan.  The spacious 4x4 Niva, supported by Fiat components, is said to be favored by opium smugglers across the Pakistani border.  The story has it, Osama bin Laden was last seen speeding away in his rusty Lada, purportedly given to him by his mentor Zbigniew Brzezinski, around 1979.

Zbigniew Brzezinski and Osama bin Laden in Afghanistan

Poland

   No other nation has such a loving relationship with Fiat as Poland.  In fact, the entry for "car" in the English-Polish children's dictionary features the image of a Fiat.

From an illustrated English-Polish dictionary

   The first license was granted to Polish automakers during the Mussolini regime in 1932.  The Communist Party renewed their relationship with Fiat in 1965, and embarked on a fantastic journey that endures to this day.  In fact, the relationship was so precious, the Poles decided to keep the name Fiat in the car's name, simply adding the adjective "Polski" (Polish) to its logo.  Thus, not unlike in the Soviet Union, Polski Fiat bore witness to many a domestic turmoil that befell that troubled country.  As the first Polski Fiats were rolling off the FSO factory line, Poland assisted the Soviets in thwarting the Prague Spring uprising.  It is not clear what role Polski Fiat played in the civil unrest of 1968, where thousands of people voiced their disillusionment with the Communist rule.  However, contrary to some rumors, Polish Jews were not given Fiats to leave the country between 1968-72.  They were forced to relinquish their Polish citizenship and given a travel document, rendering them stateless.  But it was certainly difficult for Polski Fiat drivers to avoid tear gas and bullets during the Party's crackdown on factory workers in December of 1970.  All these experiences paved way for the Solidarity movement, culminating with the creation of the first truly independent Worker's Union in the Soviet Bloc.

Polski Fiat 126p - "tiny"

    The FSO and FSM factories produced several models of Polski Fiat, but only two models, the 125p and the tiny 126p, became universally accessible.  The 126p, intended as a successor to Fiat Seicento, was so small that anyone over six feet tall had to take out the driver's seat, and commandeer the vehicle from the back seat.  However, by contrast to the Soviet-made Lada, Polski Fiat enjoyed greater respect as a machine – it broke down only half as much.  The 125p also sold well in the West, winning the 1978 "Estate Car of the Year" award in the United Kingdom.

    They joys of freedom for Polish people ended abruptly in December of 1981, when Martial Law was imposed to counter the threat of democracy.  In the iconic photograph, taken in Warsaw by a Newsweek reporter Chris Niedenthal, we can see a forlorn Polski Fiat 125p, as it passes an armored vehicle in front of the Moscow Movie Theatre.

Warsaw, December 1981

The billboard advertises Coppola's Apocalypse Now, a movie based on Conrad's Heart of Darkness.   That's exactly how most Poles, including this writer, felt during those days.  With Martial Law came the curfew, food and gasoline rations.  It was hard for Polski Fiat owners to make it through the month without running out of gas coupons.  I personally drove my parents' 1974 Polski Fiat as a getaway vehicle during a gasoline robbery from the Polish Army in 1983.

    But the lean and dangerous days ended with the free elections of 1989, and I'm happy to report that Poland is alive and well under a democratically elected government which favors corporate interests over its people.  Polski Fiat, under the name FSO, kept rolling out cars until 2002.  Another Polish producer of licensed Fiat, FSM, sold 90% of its stock back to Italian Fiat, and continues to produce updated and highly competitive models.

    Paradoxically, driving a Fiat-based vehicle in Eastern Europe today is synonymous with a lower class standing, or just pure nostalgia for the "good ol' days."  Fiat has lost its cool mystique there.

North Korea

    The relationship between Fiat and North Korea is quite interesting.  The Axis of Evil communist dictatorship produces, under a Fiat license, two small passenger cars.  As behooves a totalitarian state, Pyeonghwa Motors is the only carmaker and sole dealer in the country.  The venture is a joint one, involving tech support from South Korea, under the leadership of none other than Sun Myung Moon's Unification Church. No irony is lost on the direct translation of the manufacturer's name into English: Pyeonghwa  means "peace."  Due to the hallmark North Korean poverty, only select few can afford the Korean Fiat.

The North Korean Fiat - with really evil axis

Corporate America

    How does the United States figure into the Fiat saga?

    In the last few months we have seen government bailouts of virtually every major financial institution.  American taxpayers are footing the bill for runaway greed and total corruption of such stellar institutions as AIG.  Congress is writing blank checks to the very same corporations that have caused the financial crisis in the first place.  Bankers and insurance giants receive hundreds of billions of dollars, while small businesses, once the backbone of this nation, get a token few millions as a goodwill gesture.  Partial nationalization of banking institutions and sections of the industry makes us, the citizens, fiscally responsible for the questionable decisions of those who control our lives.  With the unprecedented consolidation of Presidential powers, and the influence of Big Business on policy making, we have officially entered the era of Corporatocracy in the United States.  The ground is prime for a Fiat deal.

    The just-announced Fiat-Chrysler partnership (Chrysler Group LLC) boasts a 55 percent ownership by a union retiree healthcare trust fund.  Only 20 percent of the company is owned by the Italian automaker.  As with the other recent bailouts, the onus is shifted onto the workers, while the corporations take the lesser financial risk.

History lesson

    If there is a lesson to be learned from the history of Fiat, it is an optimistic one.  Every dictatorship it has partnered with thus far has floundered within two decades, yielding to real democratic changes in governance (well, except for North Korea, but it's still early in the game).  A new generation of Fiat owners will soon emerge in America, enjoying their road trips and daily commute, watching the country recover in the next twenty years from the most horrifying abuse of power, corruption and graft since the creation of Federal Reserve.  Check the tire pressure – the ride is bound to get bumpy.

© 2009

Jarek Kupsc is the writer/director of The Reflecting Pool, a political thriller.

www.reflectingpoolfilm.com

Author's Bio: Jarek Kupsc is the writer/director of "The Reflecting Pool," an investigative drama challenging the official version of September Eleven. Born and raised in Warsaw, Poland, Jarek came to the U.S. in 1987, and received his American citizenship in 1992. He holds a film degree from SFSU, and has been making narrative movies for ten years, in addition to writing a film history book.

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