Bailout Watch 233: GM Cools Its Jets
November 21st, 2008 2:49 PM Share
GM has become the first Detroit firm to acknowledge the toxic fallout from what’s fast becoming known as Corporate Jet-Gate. Reuters (via Yahoo News) reports that GM will send back two of its leased corporate jets, after attracting widespread criticism for jetting to DC with begging bowls in hand. Actually, according to GM spokesfolks, GM decided to return the aircraft because of a “really aggressive cutback in travel.” Seriously? “There is a perception issue,” says GM’s Tom Wilkinson of CEO Rick Wagoner’s travel to Washington on a private jet. “We need to be very sensitive to that going forward.” What’s next? Alan Mulally’s Lexus?
Published November 21st, 2008 2:39 PM
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Stephan, My cousin flies small planes. I was reading one of his general aviation magazines and there was an advertisement for a ballistic parachute. When I got to the line, "I was coming over a mountain ridge when suddenly I lost complete control of the aircraft" I said to myself, now that surely fills me with confidence.
Isn't part of the problem that these executives have continued to enjoy lavish pay packages, perqs galore, bullet proof pensions and every other possible amenity ... while at the same time crying poor? This is just like giving yourself a bonus for cramming pay cuts down the union workers throats. Maybe it makes sense on an Excel spreadsheet, but it will never make sense to the people who just gave up some of their pay and benefits, if not their very jobs. None of these guys should have showen up in Washington until they had cut their own compensation down to the level of a Senator or lower themselves. If this is really a once in a lifetime crisis then you would expect once in a lifetime actions and communications. Instead we saw highly paid executives (far more so than at Toyota or Honda) demand a government handout without first making ANY PERSONAL SACRIFICES THEMSELVES. The jet thing is just a symbol of the whole rotten mess. Over the last several decades the executive class in America has managed to justify squeezing the working middle class while at the same time paying themselves ever more grandiose pay packages. They started with the janitors, worked their way through the factory floor and then clobbered the white collar workers with outsourcing and "right sizing". At every step of the way ... more cash and goodies for the guys at the top. At some point the camel's back breaks. We are at that point.
JH, Once workers unionize, the job of management becomes to get their labor at the lowest cost possible. Managers of non-union workers can try to get the best value out of their work force by attempting to invest in them over the long term, but that tends to go out the window when a union steps in. A free labor market helps prevent the excesses you speak of; however, our wonderful government has gotten in the way, once again. Federal and state tax codes (particularly the health insurance tie ins), labor regulations, over regulation of business, and insane favoritism towards large businesses all contribute. The government has done things to help, as well, but unfortunately, the voters are more obsessed with getting what they want than looking out for unintended consequences. Those who long to keep power over others are willing to do the hard work to ensure that every little bauble that comes down from DC is simply bait on a hook. We need to ensure that our rights are protected first in any change. Our most fundamental right is to opportunity. Guarantees for goods, services, or outcomes limit our opportunities whether we can see the connection or not. TINSTAAFL is the overwhelming law of the universe.