It’s time for a reality check. Saying sorry, or having multi-millionaires working for a buck, or even giving up your corporate jets just ain’t going to cut it.
Nope. For losing over 25% of market share in 40 years- while paying lavish salaries it’s time for new rules and a brand new attitude.
In Japan, having to lay off workers, or losing market share the executives resign in shame- or even commit suicide. Here, they laugh all the way to the bank.
Now, while we’re losing 2.500 jobs in Dayton at the truck plant- and many more that fed off it, sorry isn’t going far enough.
To placate Congress- GM is now running apology ads in trade rags:
General Motors, the world’s largest automaker, yesterday candidly confessed to the blunders that has led it to near-collapse in a full-page advertisement in Automotive News.
“While we’re still the U.S. sales leader, we acknowledge we have disappointed you,” the company said in the magazine ad. “At times we violated your trust by letting our quality fall below industry standards and our designs become lackluster. We have proliferated our brands and dealer network to the point where we lost adequate focus on our core U.S. market. We also biased our product mix toward pick-up trucks and SUVs. And, we made commitments to compensation plans that have proven to be unsustainable in today’s globally competitive industry.”
The letter, titled “GM’s Commitment to the American People,” appeared just as the House finished drafting a bill for federal aid yesterday. The company laid out the reasons why it needs an $18 billion government bailout and vowed to turn around its business.
In Magazine Ad, GM Atones for Mistakes – washingtonpost.com [1].
And while that’s nice, it doesn’t say we’re sorry to the City of Moraine which is going to see its tax base shrink to sub-atomic size after Dec. 23rd, when they shutter the truck plant.
Bailing out banks, insurance companies and now car manufacturers ain’t enough. It’s time to make these people play with their own money- not the retirement accounts or insurance premiums or our tax dollars. It’s time to shut down the Wall Street Casino once and for all.
Investing needs to mean investing- not gambling on the day’s events. Financial statements need to be real, transparent and honest. Paychecks need to be in line with performance- and stockholders have to come before the C-Suite salaries.
- We need to eliminate short selling altogether- betting against a company isn’t investing.
- We need to require all owners of more than $50K in stock to hold it for at least a year, and owners of over $250K to hold for 3 years.
- We need to require a ratio between lowest and highest paid workers that can never exceed 100 to 1, and have much lower limits if employment is cut, outsourced, or sent overseas.
- We need to require shares to be purchased on the open market if part of compensation- never issued as options. All shares must be counted as income- unless the company is an ESOP with over 51% controlled by the workers (all workers).
If you don’t like these rules- go private, and don’t ask for a handout. It’s time to reel in the wild swings on the market, and take the volatility out. Speculation isn’t investment- and if that isn’t clear these days, you aren’t paying attention.
Then again – maybe the failed CEOs could just do hari kari and really set the tone for those who follow.
I thought you were in favor of the bailout?
Only in favor of the bailout if there are some serious changes in the way all companies access money from stocks.
No more huge bonuses for becoming profitable by laying off American workers-
no more bonuses for making less money or losing market share-
no more bonuses for playing financial games to make your share price peak at the right time.
Pure pay for performance- and no more stock volatility based on speculation.
I heard this is all the unions fault….that’s what they tell me in the bars.
Being from Dayton, Ohio, I wish GM and the American car makers only the best. However, there is one aspect of the American automaker bail-out that is not being mentioned. That aspect is consumer resentment. Many of us, for one reason or another, are against any type corporate welfare. We have seen the bail out of financial institutions flop. We see an endless line of corporate beggars, with hat in hand looking for our hard earned money.
Many tax payers will resent the government bail-out and not buy cars from auto-makers who receive hand outs. This will only compound the automaker’s problems.
The automaker welfare program is very bad idea.
Senator Grassley must have read my post- only he is applying it to the AIG bonus debacle: http://www.businessweek.com/ap/financialnews/D96VP94O0.htm