I’m a loyalist when it comes to cars. I only buy American. I loved my VW Rabbit in the late 1970s, but have stuck with Detroit iron ever since.

I don’t fault those who buy foreign, because I’m also for competition. And that, too, is because I’m a loyalist. Nothing, I figure, is better in the long run for U.S. carmakers than being challenged by Japan. It’s the one thing that can make Detroit up its game.

But it hasn’t happened.

Which is why I’m not sure a bailout is the answer, and if it is, it should have major conditions. If a 35-year Japanese invasion hasn’t been enough, then the Big Three need to be shocked into changing their corporate culture.

Some say Detroit has come a long way. Perhaps. But on some levels, they’re still in the same state of denial they were in back in 1975.

I know a little about that because I got a glimpse into it in the late 1980s when I co-authored a book with Ira Magaziner, a Brown grad and Bristol resident who worked in Bill Clinton’s White House and now chairs the Clinton Foundation’s AIDS initiative.

At the time we did the book, called The Silent War, he was a business consultant who traveled abroad often and was alarmed at how foreigners were out-performing us in many industries. At home, American business refused to see it.

His experience with Detroit is worth retelling because it reveals a stunning blindness that clearly is still in the culture there today.

In 1975, he was working for the Boston Consulting Group (BCG), when Volkswagen hired them to do a study. VW was panicking because Japan, with its own small cars, had started eating into VW’s U.S. sales. Japan was also nipping at the Big Three, but they shrugged it off. It’s telling that a German automaker cared more about defending U.S. turf than the Americans did.

VW had two questions for BCG. How boldly was Japan going to invade America with cars? And was Detroit about to fight back with a domestic small-car strategy? Magaziner was assigned the case.

His first stop was Detroit, where they told him Japan would never get more than 5 percent of the market. They were a bit off. A few months ago, Autodata reported that Asian carmakers now have 47 percent of the U.S. car market, while Detroit has only 44 percent. Japanese cars alone account for over 42 percent.

Most people are roughly aware of those numbers. The more revealing part of Magaziner’s work in 1975 was when he went to Japan. Car executives in Detroit had told him the Japanese were way behind in plant technology. When Magaziner got there, he saw it was the opposite. Factories there were even more advanced, having moved beyond Detroit to unitized body construction, which lowered costs by involving less steel and easier assembly. Magaziner also found Japanese plants had more mechanized chassis and assembly operations, further undercutting the Big Three in labor costs.

Magaziner saw something else Detroit hadn’t bothered to check on with a single plane ticket or phone call: Japan was building enough new auto plants to boost capacity to 7 million cars a year — millions more than its own market could swallow. Clearly, those cars would be invading the U.S., and not only did Detroit lack a plan to fight back, it didn’t even know the Asian offensive was on its way.

Perhaps most revealing of all was when Magaziner asked the Japanese why they thought they could sell small cars in a big-car culture like America. Here’s the answer Japanese executives gave in 1975, just as Magaziner and I wrote it in our 1989 book in three sentences that are depressingly relevant today:

“Well, they said, they knew Americans liked big cars, but they also knew gas prices were going up. In Europe and Japan, prices had been high for years, which was why small, efficient cars were so common there. They felt the same thing would happen in America.”

Japan saw it then, and sees it still, and Detroit doesn’t.

Magaziner went on to challenge Japanese executives, pointing out that they had tried to sell cars in the U.S. in the 1960s, and mostly failed. Why did they think they would succeed now?

Again, he discovered a culture far more open than Detroit to learning from failure. They had done exhaustive market research in the states and were retooling completely, making such changes as more passenger room and engine power to suit U.S. tastes.

The Boston Consulting Group brought these findings back to its client — Volkswagen. The irony of it worried Magaziner. We wrote of his thoughts at the time: “Two foreign powers — Japan and Germany — were fighting over a piece of the U.S. car market being neglected by the Americans themselves.”

Magaziner had tried to point this out to some Detroit executives, even though they weren’t the client. They told him they weren’t concerned. They felt the market for smaller, more efficient cars would never amount to much in the U.S.

You could say this is old news, reflecting Detroit’s 1975 mentality.

But we’re now in 2008 with American SUV’s choking car lots and Toyota bigger than GM. That could only happen to an industry that has remained in some level of denial to this day.

Yes, a bailout may well protect the Big Three for a while from the consequences of failing to compete. And maybe we need to offer it, up to a point. But if we don’t do it in a way that wakes them up to foreign threats, there will be ever fewer loyalists like me left to buy American cars.

mpatinkin@projo.com