By on November 21, 2008


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?

Get the latest TTAC e-Newsletter!

46 Comments on “Bailout Watch 233: GM Cools Its Jets...”


  • avatar
    Detroit-Iron

    GM will what two of its jets? Smoke them?

  • avatar
    toxicroach

    Agressive cutbacks? These guys are always a day late and a dollar short. Lately I feel like I’m watching a corporate remake of a Confederacy of Dunces.

  • avatar
    lydel

    “Wilkinson said the decision to return the leased corporate jets was made before this week’s hearings and that the company in September returned two other of the seven jets it had at the beginning of the year.”

    http://www.forbes.com/afxnewslimited/feeds/afx/2008/11/21/afx5727440.html

    A classic example of Corporate Double Speak!

    Unbelievable!

    And I mean literally, unbelievable.

    These are the people we are going to believe when it comes to spending our bailout tax dollars?

    I spent over 30 years in Corporate American listening to this crap.

    Amazingly, they still spread it and they still think people will believe it.

  • avatar
    Edward Niedermeyer

    Detroit Iron: Oops! Text ammended.

  • avatar
    autonut

    Whilst we reading about GM cutbacks senate is architecting road map for paying them cash.

  • avatar
    autonut

    @lydel,

    None of us believe it, however, we will be obligated to pay for it.

  • avatar

    For all the money these idiots spend on PR you’d think they’d have a f’ing clue about PR by now.

    Prepackaged Chapter 11? Fine.

    Sans-chapter 11 bailout? No way.

  • avatar
    RobertSD

    This whole jet debate is really dumb, in my opinion.

    Let’s look at the value of decisions someone like Mulally makes in a year. Let’s low ball it and say he has been responsible for $1 billion/year in savings/benefits for Ford (that’s WAY underestimated). That translates into $30 every second, $110K/hour (and that’s every second/hour that you live – doesn’t count sleeping, so let’s say $160K/hour, which is WAY underestimating it even more).

    On a commercial jet you have to go through security, wait for your plane to be late to the gate, be delayed once you’re on the plane for air traffic (where you have no hope of doing work) and then once in the air, you have no phone or internet except on a few select flights.

    The flight from Detoirt to DC is about 2 hours on a commerical plane that are basically shot – and Mulally isn’t the one who has to produce the powerpoints. He receives the presentations, talks to people around the world, asks questions.

    So, I suppose you could book you and 5 of your staff/execs last minute (which would cost $5k-$6k) and would be completely inefficient because you have no control of seating blocks – not to mention that you don’t want to reveal company secrets while flying.

    Or, for $20-30k, you can complete your $320k worth of business (plus whatever else the other execs are contributing).

    This isn’t some great perk that allows Alan or Wagoner to sit in the hot tub and get a massage on the way to DC – it’s so they keep working. If every hour you have them working is $160k, then you could fly them in a Boeing 777 and still break even.

    When I worked for a consulting company, I didn’t get an expensive laptop, plane power adaptors and the ability to book seats with power ports even if it was first class so I could watch movies. I didn’t get a blackberry just so I had a neat-o phone. I didn’t get a membership to an airline lounge just so I could decompress during my connections… I got it to be productive – to work. Ditto the jets – I’m just not as valuable as someone like Mulally.

  • avatar
    snabster

    I don’t know what is worse: right wing SUV driving libertarian trolls who are calling for GM to sack their jets, put Rick’s head up on a stick, and cut autoworkers pay — or GM management. It is a really tough call.

  • avatar
    1996MEdition

    Buickman: Can I use my GM Mastercard points? Does it have OnStar?

  • avatar

    Just Announced…Enhancement to Red Tag Sale:

    Six Month Pull A Head on all Gulfstreams.

    stackable with $10,000 rebate on Propshafts

    can be combined with current vouchers for Kimberly Clark flotation/barf bag promotion through 12-01-08 only.

  • avatar
    Cicero

    @ RobertSD :

    I agree that from a spreadsheet-type analysis, it may make economic sense for the Big 2.8 CEOs to use corporate jets.

    But when you get $15 million in annual compensation and you’re begging for the money of strapped taxpayers who don’t have private jets at their disposal because you’ve mismanaged your company to the point of collapse, the whole corporate jet thing just rubs sand in the wound. There should have been more sensitivity to appearances and symbolism.

    For GM’s own good, Rick Wagoner should have come to the hearings on the back of a mule wearing a hair shirt.

  • avatar
    hltguy

    “There is a perception issue” according to the GM spokeshole. He must have read my TTAC post yeasterday that began “Perception folks, Perception.” The spokeshole also needs to remember “You do not get a second chance to make a good first impression”.
    You blew it dudes!

  • avatar

    I wonder how the people working for Gulfstream (6800 employees), Cessna [Citation](13,000 employees) and Learjet (waiting on a call back from Bombardier – Learjet is owned by that Canadian company but is located in Wichita) feel about evil corporate jets.

    While ABC News did say (without sources) that the CEOs’ private jet trips cost $20,000 each, they didn’t say how many executives and assistants traveled with them. When you consider how much those execs make (whether that compensation is excessive is a different issue, the fact is that they are paid thousands of dollars an hour – in Mullaly’s case, over $9K an hour) and the additional 3 hours of travel time of commercial vs. private, and the fact that the jets are already owned or leased with associated fixed costs, those jets probably saved the automakers’ money on the trip to Washington.

    It just didn’t look good.

    The next time the CEOs go up to Capitol Hill, they should have the data on how many times each Senator or Congresscritter has traveled on the taxpayers’ dime, including commercial airfair, Amtrak (Joe Biden’s favorite) with its subsidies, and on military flights and throw those demagogues’ hypocrisy back in their faces.

    If I was Rick Wagoner, I’d tell the fab shop in Warren to put some production style panels on a Volt mule and drive that to Washington from Detroit. I think it’s a great opportunity to turn this PR gaffe around in GM’s favor. In fact, they should put together a caravan, with Mullaly in a Ford hybrid (or maybe one of their Euro cars to be sold here fitted with US bodywork) and Nadelli in the EV aka Electric Europa.

  • avatar
    Paul Niedermeyer

    RobertSD,

    The value of leadership cannot be broken down into dollars per hour. Think of what an impression Wagoner would have made if he had driven one of the Volt mules to Detroit. Yes, 10 hours behind the wheel, but the PR (and potential bail out) would be infinitely worth more than your calculation of $160k/hour. Possibly $10-12 billion more. That comes to $1 billion per hour!

  • avatar
    konaforever

    Let’s low ball it and say he has been responsible for $1 billion/year in savings/benefits for Ford (that’s WAY underestimated).

    [email protected]

  • avatar
    M1EK

    Amtrak (Joe Biden’s favorite) with its subsidies

    Which pale in comparison to the massive road subsidies that keep us motoring (just not in GM vehicles anymore).

    Not that the corridor Biden travels on requires much subsidy anyways. By some measures that part of Amtrak is even profitable.

    Once again Detroit and its fans show tone-deafness amazing for this day and age.

  • avatar
    autonut

    @Buickman,
    Will Kimberly Clark be performing “Pull A Head” ?

  • avatar
    hltguy

    Every single newscast I have heard regarding the hearings have highlighted the private jet issue. I feel really comfortable handing over billions more in taxpayer money to these guys.
    Did anyone else read this morning on Yahoo News that the U.S. is going to the middle eastern countries begging, er, asking for $300 billion in financial help? The story indicated part of the reason was to “help the U.S. auto industry”.
    All of this and we are facing a new Administration that has promised to dramatically increase speanding? As if we are not spending enough already?
    Paul Nidermeyer: Exactly!

  • avatar
    Cicero

    snabster :
    November 21st, 2008 at 3:24 pm

    I don’t know what is worse: right wing SUV driving libertarian trolls who are calling for GM to sack their jets, put Rick’s head up on a stick, and cut autoworkers pay — or GM management. It is a really tough call.

    Right-wing SUV-driving libertarian trolls would not care in the least whether GM sacked its jets or bought 100 new ones, as long as the right-wing SUV-driving libertarian trolls are not compelled to finance the operation of said jets by the redistribution of their federal tax remittances to GM.

    And that’s the official platform of right-wing SUV-driving libertarian trolls.

  • avatar
    RobertSD

    I would point out that Mulally drove a Fusion hybrid to the Senate hearings from the airport (rated 39mpg – 6 better than the Camry)… conveniently ignored by the media (makes for a better story).

  • avatar

    Think of what an impression Wagoner would have made if he had driven one of the Volt mules to Detroit. Yes, 10 hours behind the wheel, but the PR (and potential bail out) would be infinitely worth more than your calculation of $160k/hour.

    Paul, let’s be honest. ABC News would call it a publicity stunt and that the Volt isn’t yet available, just like they said that the flights cost $20,000 without bothering to see if the flight saved in terms of exec time and airfare.

  • avatar
    Landcrusher

    In the future, could we avoid using the term “spokeshole”? That’s just rude. Besides that, tell us what you do for a living, and see if we can’t make something up about your profession?

    As an SUV driver who usually votes for the republican, is rather tall, and shares a lot of views with the libertarians, I also could live without the whole troll thing. I will have to say that Cicero nailed it though. If a CEO gets me a 20% return after inflation he can fly in a gold plated G5 to have get his haircut on the other coast as far as I am concerned. Of course, people who would do that likely aren’t ever going to be that successful in business. At least not without a lot of luck.

  • avatar

    Not that the corridor Biden travels on requires much subsidy anyways. By some measures that part of Amtrak is even profitable.

    Close, but no cigar. The best utilized lines recover only about 90% of costs.

    Biden’s son is on the Amtrak board. The Acela line has gotten over $2 billion so far. The current level of subsidy is $1.8 billion a year and the Cato Institute estimates the cost of that subsidy as $100 per rider, and that cost of subsidy goes up as the length of trip increases (NYC-LA $1,000, Chicago-Denver $650) Most Amtrak riders are affluent and don’t need that subsidy.

    The poor are less likely to travel by Amtrak than by most other travel options. Only 13 percent of Amtrak passengers have incomes below $20,000. The average Amtrak rider has a higher household income than the average taxpayer. In fact, the clientele for Amtrak Metroliner service between Washington and New York consists largely of Wall Street traders, K Street lobbyists and other affluent business travelers. These folks aren’t poor.

  • avatar
    Stephan Wilkinson

    I remember during the first big fuel crisis–1973?–I was piloting our company Cessna 310 twin and pulled it up to our hangar at Westchester County Airport. There in front of me was the Gulfstream owned by an organization called Wayfarer Ketch, which in fact was a front for the Rockefeller family.

    The G-III was being loaded for a flight to a Rockefeller home in Maine, I was told. They were loading the fairly cavernous aft baggage hold while I deplaned our passengers.

    What were they loading?

    Firewood.

    Can you imagine how much that half-cord cost by the time it reached Maine, where I guess there aren’t any trees?

  • avatar
    Bytor

    GM had 7 Corporate Jets? The Rot is thick and deep.

  • avatar
    rudiger

    Ronnie Schreiber: “Paul, let’s be honest. ABC News would call it a publicity stunt and that the Volt isn’t yet available, just like they said that the flights cost $20,000 without bothering to see if the flight saved in terms of exec time and airfare.”True, but even if Wagoner, Mulally, and Co. had lurched from Detroit to DC in a caravan of chauffered Escalades and Navigators, the PR would have been a whole lot better than the private jets.

    It’s a fine line, to be sure, but top level Detroit auto execs should have more of a concept of how their actions are viewed by the rest of the country, particularly when begging for buku tax dollars in a public congressional hearing. A luxury private jet is a luxury private jet, no matter how much its use is actually justified.

  • avatar
    Conslaw

    RobertSD wrote:

    I would point out that Mulally drove a Fusion hybrid to the Senate hearings from the airport (rated 39mpg – 6 better than the Camry)… conveniently ignored by the media (makes for a better story).

    Damn, the 2010 Fusion hybrids, they’re not even out yet, and already they’re rental car fodder.
    ;-)

  • avatar

    luxury private jet

    The folks at the General Aviation Mfgs. Assoc. got a big kick out the “luxury” part. Business jets are like Bentley’s “bespoke” program, or similar personalization and customization programs at other high-end car companies. All private jets are appointed and liveried per customer request. There are no stripper models with rubber mats and cloth seats.

    “Luxury” is just MSM BS.

    I suppose the next time the Detroit CEOs visit Washington, folks will complain that they stayed at the Hiatt, not a Motel 6.

    There’s a time for cost cutting, obviously, but most of this is demagoguery, spin and class warfare.

    Considering the Speaker Pelosi wanted her own 757, all this is ironic to say the least.

    Do an experiment. Call up your Senators’ and Representative and ask the staff member to please provide an accounting of that Sen’s or Rep’s travel at taxpayer expense, commercial and military. See just how eager and willing they will be to provide you with those figures. Just don’t hold your breath waiting.

  • avatar
    Paul Niedermeyer

    Ronnie Schreiber, Sure, it would be a publicity stunt, but PR and politics are inextricably intertwined. And the whole whole point of driving a Volt to DC would be to (attempt) to show that GM has the technology to make it worth subsidizing.

    Making a bruhaha over them flying their jets is just as much as a publicity stunt by the networks; the $20k cost is a grain of sand compared to what GM is bleeding.

    The question is which publicity stunt will help you get the bucks?

  • avatar
    AG

    Can we get a little perspective here? These companies need billions in savings and we’re complaining about a couple Gs?

  • avatar

    Paul,

    My point is that at this point there’s nothing that the Detroit 3 can do that won’t be spun negatively at this point. With GM and the others cutting their ad buys, they aren’t going to get any love from the networks.

    If they did caravan with their latest technology to Washington, they should stop in Cleveland, Pittsburg, Philly, New York City, and Baltimore on the way. Holding press conferences highlighting their new tech in each city. Put the press corps on a biodiesel or two-mode hybrid bus so they can cover it all the way to DC.

  • avatar
    Stephan Wilkinson

    It is terminally naive to think that TV networks decide to be hard on GM because the manufacturers are not spending a few bucks, or even a lot of bucks, on commercials.

    There are many B&Bs here who reveal considerable expertise about the automobile industry but few who have the vaguest idea, beyond “New York Times bad, Rush good,” how the media work.

    Trust me. I’ve been in a member of the media since 1959, which I suspect is a _lot_ longer than most of you have been in the car business.

  • avatar
    indi500fan

    The sad part of this deal is they could have car-pooled to DC in a hybrid Tahoe and had the corp jets make a milk run to pick them up for the return trip and nobody would have said a thing.

  • avatar

    Making a bruhaha over them flying their jets is just as much as a publicity stunt by the networks; the $20k cost is a grain of sand compared to what GM is bleeding.

    It’s also poor journalism. It has all the appearances of being written mostly before they went out to Dulles. I bet they checked on commercial air fare prices before they even left for the airport. You see guys (& gals) like this at the auto show previews, dissing the auto companies while they shovel free shrimp and free beer down their gullets.

    I wonder how much it costs to buy satellite time for their remote feeds. Why should the networks have satellite trucks and all that high tech stuff? Reporters used to use the telegraph office. If it was good enough for Eddie Pyle…

  • avatar
    Geotpf

    Ronnie Schreiber :
    November 21st, 2008 at 7:13 pm

    Making a bruhaha over them flying their jets is just as much as a publicity stunt by the networks; the $20k cost is a grain of sand compared to what GM is bleeding.

    It’s also poor journalism. It has all the appearances of being written mostly before they went out to Dulles. I bet they checked on commercial air fare prices before they even left for the airport. You see guys (& gals) like this at the auto show previews, dissing the auto companies while they shovel free shrimp and free beer down their gullets.

    I wonder how much it costs to buy satellite time for their remote feeds. Why should the networks have satellite trucks and all that high tech stuff? Reporters used to use the telegraph office. If it was good enough for Eddie Pyle…

    Is ABC asking for $25 billion dollars from the taxpayers?

    The point is, the CEOs say they have cut expenses all they can, but there’s a big old obvious expense front and center they haven’t cut. So they are liars and idiots.

    And, in the end, this leaves GM with “only” eight private jets? Or five? Whatever, if the number is greater than zero, it’s too many.

    Unless they don’t want a bailout. Then they can do whatever they want, and the only people who should care are the stockholders.

  • avatar
    cleek

    John Chambers of Cisco has owned and operated his own private jet for many years – no charge to the shareholders (or the taxpayers).

    Until recently Chambers paid for his own corporate jet use but Cisco’s board put an end to that stating in the company’s most recent proxy:

    “In September 2008, the Board of Directors adopted a travel policy whereby the Company’s Chairman and Chief Executive Officer, John T. Chambers, is generally required to utilize a private airplane for business travel because his responsibilities on behalf of Cisco entail substantial national and international travel. Mr. Chambers will be reimbursed for expenses incurred in the operation of his private plane when used solely for Cisco business provided such expenses do not exceed the market rate charged for equivalent commercial charter travel. To date, there have been no reimbursements made to Mr. Chambers under this policy.”

    http://www.networkworld.com/community/node/34308

    Want to bet Mr. Chambers doesn’t request any reimbursement, even as the business conditions get even tougher? Can he afford it? Probably. But he doesn’t have to do it. It is called leadership.

  • avatar

    It is terminally naive to think that TV networks decide to be hard on GM because the manufacturers are not spending a few bucks, or even a lot of bucks, on commercials.

    Are you saying that broadcasters and publishers are never solicitous of advertisers? That magazines don’t offer placement of ads near appropriate stories?

    Heck, CBS turned down an ad against the proposed Employee Shake Down Act card check legislation on this Sunday’s Face The Nation because they didn’t want to piss off Pelosi, who’s scheduled to appear that day. I assume it works both ways.

    There are many B&Bs here who reveal considerable expertise about the automobile industry but few who have the vaguest idea, beyond “New York Times bad, Rush good,” how the media work.

    It’s interesting that you compared a supposed news organization with someone who does commentary.

  • avatar

    The point is, the CEOs say they have cut expenses all they can, but there’s a big old obvious expense front and center they haven’t cut. So they are liars and idiots.

    It’s probably fruitless to try and convince you, but a case can be made for business jets. GM probably saved money by using their Gulfstream when you consider the amount of money they pay their execs, the number of execs traveling with the CEO, and the difference in travel time vs. flying commercial. A dozen fares bought at business (i.e. last minute) rates isn’t cheap. Three hours of check in , going through security and baggage claims adds up to real money when its 10 or 12 folks who make hundreds and thousands of dollars an hour in salary.

    Should they have anticipated the bad PR, perhaps, but when they come back to Washington in December, I hope each of the CEOs has the figures on how much each of those senators and congresscritters has cost the taxpayers in travel expenses and hope they rub the pols noses in their own hypocrisy.

    Look it up, Pelosi wanted her own 757 so she could fly her family back and forth.

  • avatar
    Geotpf

    Ronnie Schreiber :

    Q: What did Warren Buffett nickname his corporate jet?

    A: “The Indefensible”

    And his business isn’t begging for change from Uncle Sam.

  • avatar
    Stephan Wilkinson

    When I was driving a corporate jet–just a Citation, nothing fancy–we would be cranking the right engine the instant the boss’s car showed up on the ramp. The left engine started as soon as the airstairs were up, and by the time he was in his seat, we were off the blocks.

    Compare that to check-in, security, boarding, delays, pushbacks and all the rest. Nobody told me when to push, I just called for taxi clearance.

    You can’t believe how convenient and efficient it is unless you’ve been there.

  • avatar

    Call me a cynic, but if the CEOs didn’t use the company jets, this is the kind of coverage they can expect:

    Dateline: Detroit, Nov. 30, 2008

    Stung by criticism for their use of luxury private jets traveling to Washington for their last appearance before the Senate Finance Committee, the CEOs of the Detroit based automakers have embarked on a five hundred mile publicity campaign, driving in a caravan to the nation’s capitol. The purpose of the caravan, publicists for the automakers say, is to highlight their commitment to new, fuel efficient cars and trucks as they as lawmakers for financial assistance. Unfortunately for consumers, none of the vehicles are in production yet or on sale. Even if the domestic manufacturers survive, there are serious questions if these cars will ever be produced.

    Rick Wagoner, Chairman of General Motors, will be driving what GM is calling a “production prototype” of the Chevrolet Volt, an electric car with what the automaker claims will have a 40 mile range on batteries, plus a range extending combustion engine that drives a generator. Alan Mullaly, Chairman of Ford, is driving a Ford Edge crossover equipped with Ford’s experimental hydrogen fuel cell powered HySeries Drive hybrid system, and Robert Nardelli, CEO of Chrysler, is piloting a Dodge EV prototype, a 268 horsepower electric vehicle powered with lithium ion batteries.

    Whether the caravan helps convince lawmakers to provide the billions of dollars needed to avert bankruptcy is an open question, but the automakers are pulling out all the stops in what is probably the first joint publicity effort in the history of what used to be called the Big 3. To ensure media coverage, journalists will accompany the tour on a New Flyer transit bus powered by a two-mode hybrid powertrain supplied by GM’s Allison division. While an improvement over conventional buses, it still only gets 5 miles to the gallon.

    Though the trip is supposed to highlight new fuel savings technology, and though two of the cars use no gasoline at all, a fleet of support vehicles, mostly large SUVs and vans, is accompanying the executives so actually the caravan will use a lot more fuel than a family trip Washington. The vans and SUVs are filled with engineers, hydrogen tanks (for the Ford) and generators (to recharge the Dodge). They’re not talking about it, but they are also carrying a full range of replacement components in case something goes wrong. A CEO stuck at the side of the road is not the kind of publicity the automakers want.

    Of the three, the Volt is the closest to actual production. Though the car Wagoner is driving looks like the production Volt revealed at this year’s New York Auto Show, it is really what the automakers call a “mule”, a test vehicle with new components installed in an existing platform. Converted Malibus have been seen testing the Volt drivetrain at the GM proving grounds and on Detroit area streets. Sources say that technicians at GM’s Warren, Michigan tech center have been working around the clock since the private jet story broke, fitting panels styled for the production Volt onto one of the test mules.

    Ford’s HySeries Drive Edge looks just like the production Edge, except for the port on the fender to plug it in to charge the batteries that can power the crossover for 25 miles until the hydrogen fuel cell is needed for power. With a range of only 225 miles, Mullaly will have to stop for gas, literally. Though hydrogen is the most plentiful substance in the universe there are almost no hydrogen filling stations in the US, the support fleet is carrying extra tanks of the gas for refueling. At this point the HySeries Drive is pretty much experimental and has only been installed in a couple of show cars. Ford has not announced any plans to produce it.

    Chrysler introduced the Dodge EV sports car to the media earlier this year and like the Volt mules it has been seen driving in the Detroit area. Some have accused Chrysler of copying Tesla, the Silicon Valley start up that has sold a few dozen Tesla Roadsters. Like the Tesla, the EV is based on a car from Lotus Cars in the UK, with the standard drivetrain replaced with an electric motor. With a range of less than 200 miles, the caravan will have to stop for a bit to let Nardelli recharge, which takes 8 hours with standard household current. The support vans, though, have powerful 220 volt generators, to cut that time in half.

    Of course, stopping will give those journalists on the bus a chance to stretch their legs, interview the CEOs and the PR flacks along for the trip, and file their stories.

  • avatar

    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.

  • avatar
    John Horner

    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.

  • avatar
    Landcrusher

    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.

  • avatar

    TINSTAAFL is the overwhelming law of the universe.

    TANSTAAFL, there’s an “ain’t” in there.

    Like Walter Reuther told George Romney, more and more pay for less and less work is a dead end.

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • dantes_inferno: Ban cows
  • dal20402: KBB had it in the high 18s at the beginning of the year and now in the 22s. I’m sure part of that is...
  • probert: The government should protect them – regulating predatory practices is something government should do....
  • 28-Cars-Later: Then get one more year out of it before something expensive breaks.
  • 28-Cars-Later: Your Bolt? Carvana has them listed out your way for 21,9-22,9, were they retailing for much less?

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Mark Baruth
  • Ronnie Schreiber