Have Plane, Will Travel

by Ron Daly

You'll have to excuse me today, I'm a little cranky. Didn't get much sleep last night after another bad day in the financial markets, TARP and HARP (catch the breaking news story) all over the news and stories of credit unions being merged out of existence (click here to read more). The icing on the cake was the carpool ride home with my wife talking about the declines in our 401k plans over the past six months. She pointed out that at this rate we'll be working till we are 100 or at least till we drop dead in our seats in the office. In my feeble attempt at humor, I pointed out how the new administration promised to take care of everyone so we'd be just fine.

So now it's getting late and I'm listening to the Tonight Show for maybe a few laughs in the monologue before hitting the sack. Suddenly, Jay Leno jokes about the auto industry CEOs taking their private planes (yes, with an "s" to the tune of about $20,000 EACH), to a meeting in Washington to talk about getting $25 Billion for bailing out the auto industry. (Read about it here) The punch line? "Couldn't they carpool or just go first class and save some money?" The audience chuckles uncomfortably to be somewhat polite and Leno moves on. This morning, the Fox News team is yuking it up about the story as well.

You know what…it's not funny at all and probably an indication of the problem. I'm sure that the big three can come up with ten business reasons for the private jets and justify the expense. Just like AIG could justify the management training offsite that cost hundreds of thousands of dollars after they got their government handout.

Let me put this in a credit union perspective. Let's say your credit union is working diligently on helping a member with a workout plan to cram down his debt, get him back on track and keep him in his house. You're meeting with him today and before the meeting you're looking out your window to enjoy the day. You see a limo pull into the credit union's parking lot, the driver opens the back door, and to your surprise, the guy that you're meeting with for the workout plan steps out. How does that make you feel? 

Send some kind words to our poor, beleaguered auto industry CEOs in the comments section. Depending on how mad I get about things today, I might have a few of my own down there.

Comments

[SRG]

Yeah I heard about that plane ride on NPR last night, ridiculous. They compared it to a guy walking into a soup kitchen wanting to get served a free meal in a top hat and coat...

[Sherry]

My sentiments exactly. A business is a business is a business. When your bottom line is hurting you cut, from the top down, everything you can to stay in business. These CEO's figure those kinds of things were negotiated in their salary package and by golly if the company is going down or not they are going to get every bit of what was promised to them. If my credit union was struggling I wouldn't fire 5 employees just to get an annual pay raise.

I had sympathized with the auto industry since they didn't directly cause the economic issues that put them into that position, however, that being said it's a slap in the face to everyone one of us footing the bill for the bail out funds (while we take the darned bus just to make minimum wage).

[Denise Wymore]

There was a great moment on CNN last night - they showed a clip of some Congressman addressing the big three and their jets.

It went something like this:

"Show of hands, how many of you will leave your jets behind, sell them here, and take a commercial plane home?"

Blink. Blink.

He went on to say:

"Let the record show, we had no volunteers."

Wow - B.A.L.L.S.
That's all I'm saying.

[SRG]

LOL that's awesome the Congressman did that!!

I'm originally from the Detroit area so I'm sad to think of those businesses going under for many reasons, though it seems that's what it will take for the necessary restructuring to occur. What worries me is how many people's jobs and other domino effects that could cost...

[Jimmy Marks]

This video shows what was talked about earlier - congressmen get tired of getting softballed by these car people.

http://www.youtube.com/watch?v=UMJ2BU0CDT0

[Elliott]

Dear CEOs,

First of all, thank you for hiding behind your employees rather than admitting that you are running one of America's flagship industries into the dirt. You understand that spending company dollars on luxury and convenience isn't symbolic of corporate waste and upper management's disconnect with the working force; you are just trying to maintain an image that's things are "business as usual" while you hold out your hands for $25 billion.

We understand that your fleet of jets (price averaging $36 million per) is money well spent. Flying first class may add valuable minutes (maybe even hours!) to your trip. Until now, you've been using that extra time to keep Detroit in the black.

We understand that you didn't cause the tough times we're in. It's just that you aren't strong enough to weather them. I'm sure that if we give you a huge chunk of money now, you'll be just fine next time the economy turns down.

Also, make sure that you blame as many different things as possible, health care costs, pensions, regulation, etc. It's best to focus on all of the things you don't have the power to change. Leave improving internal efficiency to the outsiders.

Sincerely.

(Wow, that is perhaps the most sarcastic thing I've ever written. I apologize, sort of. On a serious note, I worry for everyone whose livelihood relies on these three men.)

[Jim Updike]

I’m finding it incredibly interesting, being as how I work for the credit union for Honda, to see the differences between an automotive company that ‘gets it’ and others that don’t have a clue.

For example; if you were to go to the corporate headquarters of American Honda, you’d notice a nice, but certainly not elaborate, five story building. Once inside, one of the things you’d notice is that, no matter which floor you’re on, you can stand at one end of the building and see out the other side. Suddenly, you realize it’s because there are no private offices! If you visit the Credit Union’s headquarters, you’ll notice I sit in a cubicle. The President of American Honda has the same size cubicle I do.

Honda culture dictates that there are few, if any, executive perks. There are no executive lunch rooms. Not even any reserved parking. In the manufacturing plants, everyone wears the same white uniform with their first name on one side and the Honda company name on the other. When I say everyone, I mean everyone including the top management.

The people who work for the Honda companies in the U.S. feel a great deal of pride working for Honda. So much so that the unions have never been successful in organizing Honda. This results in a company that is truly ‘customer-centric’ with one of the most flexible manufacturing processes in the world.

The President of Honda of Japan has gone on record to say that while he doesn’t oppose the bailout of the auto industry, Honda has no intention of participating. Maybe it’s because they don’t need to…

[Elliott]

Great post, Jim!

[Marvin Umholtz]

Mr. Daly’s anger at the CEOs of the big three automakers is certainly understandable and I hope that it has cathartic value for him and the many others who had similar reactions to the corporate jets. The automaker CEOs should fire their lobbyists, public relations specialists, and other handlers for letting them make such a highly public goof. However, the members of Congress who engaged in this rhetorical game of kick the CEO in the pants are largely engaged in theater. Isn’t there a real root problem the populist rhetoric is ignoring? I am neither in favor of nor opposed to bridge loans for the big three. But if it is true that three million jobs are at risk, then that means a lot of credit union members will become jobless and the delinquency rates are going to soar. Now that is something to really get angry about!