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Layoff Bonanza

Discussion in 'Issues Around the World' started by ethics, Nov 4, 2002.

  1. ethics

    ethics Pomp-Dumpster Staff Member

    As we have seen with some of our members here, the layoffs are cutting across our lives like never before (as much as I can remember).

    New York Daily News has a front page story which has an issue many know about, but in case for those that do not:

    Merrill Lynch axed 17,400 employees and kept a stable of analysts who allegedly misled investors. The reward for CEO David Komansky: A $42 million payday - not to mention the $110 million-plus in options he has yet to cash out.
    Lucent Technologies pink-slipped 56,000 workers and posted a $17 billion loss in 2001. The payoff for Chairman Henry Schacht: A $22 million package.

    Citigroup canned 7,600 and became the focus of massive and ongoing conflict-of-interests investigations. No matter; Citigroup handed CEO Sanford Weill a $46 million bonanza - adding $360,000 for his use of planes, helicopters and limos.

    AT&T cut 10,100 jobs, lost $6.8 billion, watched its stock tank and bailed out of cable TV. That didn't stop it from giving CEO Michael Armstrong $21 million, plus sweeteners such as free financial consulting and rides on corporate jets.

    "They ought to take a huge cut in pay," said Graef (Bud) Crystal, an expert on executive pay. "Instead, they act like they just won Best in Show at the Westminster Kennel Club."

    Once the gold standards of American capitalism, these local companies were admired for nurturing cultures that fostered loyalty and integrity and fueled job growth. Not anymore.

    Along with dozens of other blue-chip firms, they cut staff, corners and standards during the past two years.

    As the stock market spiraled south - and profits, investor faith and corporate credibility crashed and burned - there was one item on the books that did not immolate: CEO compensation.

    The typical chief of a major U.S. corporation raked in an average $15.5 million in total pay last year, a nationwide survey found. That's 428 times the $36,250 in annual salary earned by the typical American worker, a disparity 10 times greater than it was in 1980.

    In the New York region, the average big-company CEO pulled down $26.6 million.

    More here (see section on NYC also--my home city)
  2. jamming

    jamming Banned

    Welcome to a Free Market Economy, it ain't purty but it generally works.
  3. Sierra Mike

    Sierra Mike The Dude Abides Staff Member

    Yeah, Corporate America is really shooting a lot of us in the ass. Thank God for my rental properties--when I was laid off last January, I thought, hey no big deal, I'm a senior technology management guy, I'll find a gig in no time.

    Sure I will. I haven't worked a day since January 14th, 2002. And it's not like I haven't tried; I've hit the pavement pretty much worldwide, but the fact of the matter is, no one wants to hire a director-level technician, no matter how good he is. And the managers who are hiring are definitely not going to hire someone who might be better at their job than they are. The days of hiring supa-talent and taking the credit for all the good work in the board rooms are pretty much over. I know one of the first real, honest-to-God internet architects in the business, a guy with a PhD and everything...and he's been out of work since last December, when March First hit skid row.

    I'm blaming Corporate America big time for a lot of our economic doldrums. The American consumer is spending money like mad, but the corporations are continuing to cut back and tighten their belts. No one saves their way out of a recession; they spend their way out.

    And are corporate CEOs really worth all these millions? Their bag of tricks is absolutely no bigger than mine, with the exception of some fancy degrees from Ivy League schools.

    Pardon the bile.

  4. ethics

    ethics Pomp-Dumpster Staff Member

    Free Market economy? Looks more like Oligarchy to me, except it's not as insidious on the Government level, arguable, but certainly on the corporate level.

    Reminds me of the collapse of Soviet Union.
  5. ethics

    ethics Pomp-Dumpster Staff Member

    Spending will slow drastically and probably stop to a halt.

    When you have people getting laid off left and right, it's not just the people getting axe that are not spending, it's the others who fear the same.

    Edit: Grammar.
  6. RRedline

    RRedline Veteran MMember

    Simply amazing. I can't believe that these companies value these asshats so much. I think $1,000,000 per year in salary is very, very sweet. But these guys are getting paid more than ten times that amount even when their companies fail? Give me a break.

    Capitalism does work, Jamming, but sometimes it makes me want to puke. Where does this trend end? Will we have a total plutocracy where 99% of the population are economic slaves to the top 1%?
  7. ethics

    ethics Pomp-Dumpster Staff Member

    RE: Plutocracy. Was looking for a term better than Oligarchy and you've nailed it.
  8. jamming

    jamming Banned

    I agree 100% with you on this, it is sort of like knowing where veal comes from.
  9. Coot

    Coot Passed Away January 7, 2010

    Or a working knowledge of good colon health ;)
  10. Coot

    Coot Passed Away January 7, 2010

    In Related News...

    It appears the Feds are ready to cut interest rates to levels not seen since the Eisenhower years.

    If we can't seem to spend our way out of this and if the cheapest interest rates in 45 years doesn't seem to be doing the job, I hope the Boards of these companies are looking at bouncing the current gaggle of CEO's out on their collective asses. A new corporate paradigm looks to be in order.
  11. Steve

    Steve Is that it, then?

    Re: In Related News...

    I've got one for them:

    Have a viable business plan, produce a quality product, make a reasonable profit and post a decent dividend.

    Oh, wait.....
  12. ethics

    ethics Pomp-Dumpster Staff Member

    Re: Re: In Related News...

    LOL! Way too much sense!
  13. Steve

    Steve Is that it, then?

    I got my diploma from MBA's R Us....

    We didn't have time to learn how to "proactively alter the marketspace to position our offerings in a forward-leaning, culturally-sensitive context in order to capitalize on TQM and ISO 'lessons learned' so that, at the end of the day, maximum holding value was achieved for all stakeholders".

    We just learned how to manage the process of making stuff people wanted to buy for more than our cost of prodution plus overhead.
  14. pupowski

    pupowski Banned

    Executive compensation is not a free market, and there is considerable evidence that huge paychecks do not bring huge rewards for the owners(stockholders), employees, or customers. The average corporation is run more by committees, than the CEO, who should be viewed as an employee, unless he is a founder or major shareholder exclusive of stock options . The corporate governance crisis should make one thing quite clear- don't trust the CEO.
  15. -Ken

    -Ken Guest

    I am very curious how some of our more ardent conservatives are
    feeling about the economy and how well our president is managing it.

    Have you guys changed your feelings about President Bush or are we still
    blaming President Clinton or perhaps the Democratically controlled Senate
    for these economic problems.

    I remember George Bush saying during the presidential elections, we
    are not in a recession but if we were, I have a plan. Well, is this still Bill
    Clinton's fault or is anyone willing to admit this is a failed economic plan?
  16. jamming

    jamming Banned

    OK this is my view, the President (any President) does not manage the economy. They can make choices which improves the economy in one direction but it generally is a response that takes several years to change. What they can manage is somewhat Public Perception of the Economy, which sets the public mood. Here is my take on that, Republicans don't by nature desire a bad economy, so they really never talk down the economy when it is good regardless of who is in charge. What the Democrats do is they see the economy as a political tool, along with race relations, and other things to get votes.

    Democrats want to redistribute the pie and Republicans want to make a bigger pie. The high points of the 1990's were the result of two factors, military downsizing and the restructuring of our society from the hard consumer manufacturing to the informational content and service society. It could be promoted or delayed by choices of the President at the time, but it was going to happen. The early taxes of the first Clinton term, probably cost several million jobs that could of been grown sooner, but we will never know with certainty. But even those policies couldn't really stop or prolong this transformational change for long.

    As we live right now, the next transformational cange in our economy are having their seeds planted, the ones who realize it early and how to take advantage of it will be the Microsoft and Dot.coms of tomorrow.

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