Reality could be subjective and perhaps they do not feel that it pertains to them.

They are out of touch. They claim for security reasons. Fly commercial and bring a bodyguard. I am sure if one of those guys walked by me, I would not know them from any other person. They think they are so important but in reality, they are no better then anyone else.

For some reason (maybe security concerns) many large corporations have policies that require CEO’s and other high muckity mucks to fly chartered jets. So your third bullet point — did someone point out the optics problem and was overruled — is the pertinent question.

To your question of whether politicians fly commercial, I believe the answer is, sometimes. This past summer I flew on Southwest flights to and from Alabama with the senior senator from Alabama on the flight; several years ago, I was on the same commercial flight with former president Clinton from New York to DC; and, in more affluent times, I traveled to Newport for the weekend several times on the same USAir flights with congressmen from Rhode Island. Maybe politicians are slightly more attuned to the optics, or maybe they just don’t have corporate aircraft at their disposal.

Since we are in this season of change, I can understand the focus on how these CEOs arrived in Washington. But the reality is this is how these guys function in the world; this is how business is done. Now, we can perhaps talk about how to implement change, since they are seeking government assistance. But to berate them publicly and speak to them as children, I did not like to see. This was not the proper tone to set in such a serious time. I can see a demand that they be removed (and I’m not suggesting this), but I do not understand the public paddling.

If the questions were being asked regarding the business itself, this I understand. But to attack the fact that they appeared in private jets, I found inciting and futile. (Most senior executives in business and in senior religious officials fly on private jets.) The barrage of comments relating to their travel diverted attention away from the very serious issue at hand. I’m not even sure whether they fly commercial will change anything or whether there will be a change in policy regarding their travel. Let’s instead talk about how to retool this important industry.

So, in this season of change we can begin to really address some important issues, even appearances, which the private jet discussion seems to be about. But let’s not grandstand for its very sake, while nothing really changes. The American people should look beyond the hype to see exactly what is occurring on both sides. Only then can the needed occur.

By the way, I am from Detroit and I have two very good friends who are senior executives at two of the Big Three; they are brilliant and creative. I cannot conceive of placing the present problems at their feet, though I do think that the bucks stops at leadership and when there is failure this must be addressed. Firing them, however, will not improve the situation at their companies; it will probably worsen it.

Tactically stupid, though maybe they were giving the bird to the world.

10 years ago, I interviewed with one of the Big Three Automakers for their post-MBA corporate finance programs. It become very clear during the interviews that they did not want anyone that would challenge status quo. I heard from others that this was normal for them. I would not be surprised if no one had questioned the decision.

I have stood in an TSA airport security line with a Senator. If he was going through that hassle, I would assume he was commercial.

Bing,

Yes, I think the CEOs at the Big Three are stupid. And out of touch. If I were in charge of handing out taxpayer money to people riding around in private jets, those are exactly the questions I would be asking. And one more: Will you step down as CEO if we give your company the money?

Their cars wouldn’t start.

http://www.sawyerspeaks.wordpress.com

Auto Industry is like the Government and many large corporate US companies.

I worked with a large healthcare payor corporation and showed them the ability to generate $120 million more annually. About 90% Profit by simplifying a major process. This was proven with their data and could be implemented and in rollout stage within weeks.

The CFO was ready to go then the CEO and other SR management idiots were

1) measuring what changes would happen – Remember bigger is better
2)would there be a shift in power
3) Would it mean they would actually have to work for a change
4) Why disrupt status-quo and why aren’t our competitors doing it
5) We can already do this but we are not focused on it at this time.
6) We are losing money but thats OK we can raise premiums.

Well the take away is they were lazy, stupid, can’t compete, don’t want to compete, have not invented here syndrome and turf protection to deal with. The CEO and Staff should have been FIRED for being that stupid.

Most large companies are like this. The SR management wastes time on other company boards or in useless meetings hiding from the responsibility of making swift decisions and taking actions.

In the other large companies they run a puppet master company where everybody follows marching orders no matter how stupid they are because everyone is afraid to step up due to risk of their job being elmiminated.

it’s time for the little companies to make a comeback. Why would you pay a CONsulting company 300 dollars an hour for an wisdom less offshore guy with no experience while they are paying him 20 bucks an hour. CONsulting companies make no guarantees except we can send in more billble bodies.

Arrogance. Plain and simple.
They just don’t get it. Never will.
They’re better than us. Smarter, too.
Like Leona Helmsley, they refer to us as “little people,” as in “little people can bail us out because only little people pay taxes.”
Even with the price of gas nose diving, my wife just bought a Toyota Prius. Made in the good old US of A. At least I think it is. Doesn’t matter.
Roger Smith thinks GM = Getting Mine. He’s about to find out GM = Grossly Mismanaged.

I understand all the issues about flying private. There are many good ones. But to fly in three separate planes to Washington to ask for help is just bad PR. Somebody should be advising these guys to walk the walk while they’re talking the talk.

The only thing they could have done worse was to show up in a rented Honda or a KIA.

Stupity unlike cash is one of the few things that doesn’t seem to be in short supply in Detroit.

Letter to the rest of us

NO BAILOUT FOR ME. I lost my job because of the sub-prime debacle, after 5 months unemployed, I had a heart attack and a triple by-pass. The hospital picked up over half the bill because I had no job, and NO MEDICAL INSURANCE. I couldn’t afford it. SOUND FAMILIAR?
Because I cannot make the size payments needed, I will be sent to a collection agency.
We wanted to buy a house, but thought better of it because of the loans that were being offered. Now I will probably never buy one, because with the payments I can afford, I will never be out of debt before I die.
WHO WILL BAIL ME OUT, I wasn’t overpowered by greed, and I didn’t talk someone into getting in debt over his or her heads to make a buck for myself. I didn’t lie, cheat or steal. I’m just another average, hard working American who has to pay for THEM.
WHO’S GOING TO BAIL ME OUT?
Maybe one of those CEO’s that only take home a mere 40 to 120 million will help me out!
NO one will bail me out, I’m just an AVERAGE AMERICAN

-Yes
-No
-Probably
-Because it made sense
-They really are stupid
-Can’t get 3 huge egos into one plane
-Yes
-My jet’s bigger than yours syndrome
-Of course
-They were never In touch
-They self destruct
-Yes
-They have no substance.They are black holes in everyone’s space.
-Their middle America is surrounded by a belt
-We don’t have to blame anyone. There will be enough suffering to go around.
-

Executricks in the mahogany board rooms transform into theatrics.

One would wonder if Michael Douglas and Tom Cruise portray the corporate board rooms, or, the corporate board rooms portray Michael Douglas and Tom Cruise.

A status symbol is supposed to be a window into what a being has behind his eyes and between his ears.

Executricks compliment theatrics hopefully implying the statement: “DON’T TOUCH ME I’M A STAR” among the super achievers.

Heading South on I-75 from Detroit to Toledo, I was passed by a vehicle whose fenders were flapping in the wind. The body of this vehicle was rusted to the point of non-identity.

The bumper sticker read “I have one thing money money can’t buy–POVERTY”.

He was just as proud of his little junker vehicle as the C.E.O.s’ were of their private jets.

Congress is conducting its own “PERP WALK” with C.E.O.s’; they started with big tobacco and big oil, now they have big automotive.

Who will be next, pharmacuticals, medicine, religion? Interesting!

It’s hard to imagine that someone could be become a captain of industry and also be stupid, but stranger things have happened in the history of man.

And while on the subject of imagination… think of the statement it would have made if these guys had carpooled down to DC from the Motor City? Since they are big shots, nobody would have blinked an eye if they had a hired man do the driving. It would also given them time together to come up with a good story to tell Congress and the American people.

Sadly, imaginations seems to be in about as short supply in Detroit as profits from car sales.

I quit my job back in April and though it hasn’t been easy, I am now representing myself in the free market. If I undercut the bloated prices of some of my former employers… well, that’s just the market in action.

In my view, from the middle of society, if a person needs to find someone to blame for all of their troubles in the world, they only need look in the bathroom mirror.

Preferably under a harsh and unflattering fluorescent light.

It does wonders for putting it all in perspective.

The devil is in the details. That may actually be the whole ballgame. They were not, and have, been paying attention to the world … the one they have always thought revolved around them. This mode of operation is catching up very quickly to them. The private jet flights, which are quite common in the business world and have some logic to support it, are just a small glimpse of the thought pattern.

Bing…a long long time ago, in a corporate galaxy far removed from our time, I was a young MBA graduate student. Enrolled in a school of business, of not totally inconsequential note, I observed many perplexing (at the time anyway)logical inconsistencies.

My undergraduate training was in the physical sciences. The MBA pathway seemed the logical approach to financial success. I found the course work rather unintimidating…its technical basis undemanding and shallow. At certain points the MPA program (Masters in Public Adminstration)had a common nexus with the MBA curriculum….cost accounting tools…that sort of thing. As an outsider to either discipline, I was struck with a consistent MBA emphasis on the glorification of individual competition at any cost. Real cheesy gladiator Gordon Gekko kind of stuff.

This was the era of Druckerian ‘maximization of shareholder wealth’, a practical theory that, at least in my humble opinion, has been distorted to epic, and unintendented, proportions (an analog to the abuse of the term ‘enlightened self-interest’). The MBA student’s approach was consistently self-focused…while the MPA approach had at least a modicum of societal concern. And no, I did not become a public ‘administrator’ of any kind (so this post is not intended to be self-congratulatory). Turds exist in both ranks.

In short, are we seeing the fully realized embodiment of such attitudes in the corporate sector? Are the private jet transportation antics of the Detroit CEO business androids simply an obvious sign of the chasm that we have created through the worship of selfishness?

Bing, I apologize for any insults you may have suffered from my posts. You have long been one of my favorite authors (you successfully bridge several worlds in a most entertaining fashion). Your entertaining monograph regarding consultants remains one of my all time favorites.

In short, what are we going to do with this economic mess? How do separate the wheat from the chaff? Why does your blog give us such a pathetic little window to proof-read our entries so as to avoid looking like total asses? I don’t mind coming across as a total ‘blood-eyed’ lunatic, but at least I’d like to review my script in somewhat full text mode before posting.

Spokane says ‘hello’.

If they went on one jet or used public transport (whats wrong with using the products they make?), how would they have found out who has a “bigger” one?

Betty.

What happened to good ole teleconferencing? I thought the point of high end projectors and fiber optics and massive computer servers was to facilitate the need to not be at a meeting in person if it wasn’t in the same building?

They have mastered their Executricks for sure…

They obviously decided long ago that private planes are justified, and just didn’t reconsider in light of this trip’s purpose.

What’s of far more concern, though, is that these guys don’t get that they’ve screwed the pooch. (With the possible exception of Mullaly, who’s only been at Ford for a year.)

These guys think they’re doing a great job! That’s why Chris Dodd’s takedown was so fabulous.

Sure, if you’re making your company billions, you shouldn’t waste your time waiting for a delayed commercial flight in an airport where you can’t discuss confidential information. But if you’re losing billions every quarter, then maybe your firm benefits from your being out of pocket.

According to Aesop’s ‘The Ant and the Grasshopper,’ the grasshopper stuck to his dance and sing reflex until he went seeking a bailout. Sticking to it during the bailout request may indeed be breaking new ground.

It might be relevant to recall that Chrysler has already received one government rescue followed by the senior officer broadcasting an ad, ‘If you can find a better car, buy it!’ It sounded so much like the grasshopper had learned something.

Had they just been able to have an answer for the panel it would have been less of a shameful display. Silence was not golden in this case. They could have easily noted that security is paramount especially in troubling times like these. I refer to security of the execs AND the information they carry with them.

I personally am not buying this whole we will run out of cash thing. GM is huge – they can shut down production to prevent spending cash as needed to live on. My take is they want to keep moving ahead business as usual and tap the tax payer for the right to do so. Come on Nardelli…you were almost in Jeff Immelt’s seat (not that Jeff is setting th world on fire…just GE) can you not manage your statement of cash flows?

Not stupidity, just complete lack of common sense. These muckety-mucks are just completely removed from the real world. When was the last time they actually stepped in a grocery store, or pumped gas, or stood in line for a driver’s lic? They live in their ivory towers and are handed everything on a silver platter. Not stupid, just completely out-of-touch. With the billions given out to all these companies, congress could have given $10,000 to each and every taxpayer in America. How many mortgage payments would that cover???

I think the answer is that they didn’t even think about it and they are really that out of touch.

What’s sad is that when (and I do think it is when and not if) the automakers get their share of the bailout, they’ll do exactly as the banks have done with the money: hoard it or use it to buy other companies and then lay off half their workforce to “save money.”
So the taxpayers who ultimately fund these bailouts get the double shaft. They get to see their hard-earned tax payer money go up in smoke AND lose their job.

Now that REALLY blows!

These are the same companies who decided it would be best to continue trying to make record profits from SUV’s and big trucks after gas prices skyrocketed. When these big vehicles were popular, buying gas for them was hardly a concern in a family budget.

Now, all they can do is beg for mercy while pleading the case that the world will end if we don’t pay up. I don’t know about you, but I have no problem letting them go.

As far as I can tell, the best thing they could have done for PR is to car pool to Washington in a Toyota Prius. Then, they could at least try to make the case they aren’t complete idiots.

Executives are paid big bucks to make big descisions. Deciding their travel is usually done by someone else. That being said…Yes, executives do lose touch with their employees, their customers and other executives as the descisions and stakes become greater. The longer a company has been in business also contributes to entitlement and larger than life egos…most senior executives never see trouble coming because they don’t know any better. However they rationalize it, taking a private jet was like taking a limo to pick up your welfare check…

Here’s another tidbit. I read in an article today that the average United Auto Workers employee makes $73 an hour, which equates to just over $150k a year.

I am an entry level aerospace engineer (rocket scientist), and I make just over 1/3 of that. Seriously?

Chapter 11 for the Big Three is the ONLY answer. They need to get out of ridiculous labor contracts and start paying people what they are actually worth (a mere fraction of what they currently make).

GM’s total labor costs — current workers plus pensions plus health care for retirees — divided by the number of current workers comes to $73 per current worker hour.

That’s obviously not the same thing as current workers grossing $73 per hour.

It’s a misleading statistic that certain folks have been pushing for a long time.

They make $32.15/hr plus benefits.

Still pretty damned good pay for an unskilled job anyone off the street could perform.

They thought Americans would continue to be stupid and take out 5 or 6 year loans on a car that runs out of warranty in 2 years and starts to fall apart immediately following.

I have been burned buying a new “big 3″ car twice, I sold the first at 6 months and the second one needed a transmission overhaul, cruise control broke and the A/C went out right after the 36,000 mile warranty expired. The ABS brakes quit twice (once in warranty and once right out of) and the battery completely crapped out just before the warranty expired. That was in 1998 and my last U.S. car.

I saw a special about GM on CNBC a couple months ago where a UAW worker explained how in the recent past; “If buttons or knobs or whatever were missing that it was SOP to just ship the car”, us stupid americans would take it because it was NOT Japanese.

Yes, they should have flown private.

The ‘Three’ arrived in Washington last week to plead their case for a strong future and their companies survival.

Would anyone in their right minds allow the airlines to fly these guys to the most important meeting of their lives? A meeting that could affect millions of jobs?

veblen

Your added insight doesn’t make me feel any more sympathetic to the workers. It is still a lot of money, and there are plently of folks who have neither insurance OR pensions included in their terms of employment.

I saw Michael Eisner interview a Big 3 head (Chrysler/Dodge, I think)on Eisner’s CNBC show. When Eisner asked how the company would compete with the Japanese hybrids, the guy – with a straight face, no less – described how they would take the “fantastic” multi-fuel engines they make for SUVs and put them into smaller cars over time. OVER TIME!!!??? Yes, the heads of America’s Big 3 are so out of touch, they need help tying their own shoes. I’ve owned one American car, three German, and two Japanese. I’ll never buy American – ever – again.