Reuters:
IAC Chief Executive Barry Diller took several groups to task at the Reuters Media Summit, but he reserved special disgust for CEOs at profitable companies who add to the country's rising unemployment rate.
Also targeted by the former Hollywood executive were "incredibly, shockingly stupid" Big 3 auto executives, the Internet's strange and growing dictionary, and Hollywood's lack of creativity.
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I for one work for a major manufacturing company and we have for years run departments one or maybe two deep. We in the trenches have seen the problems when one of these people leaves because of a new job, retirement, layoff or even death. The entire segment of business is thrown into chaos because of this. But still we have little cross training and even if we did everyone is already doing the work of 2 or 3 people. We have seen this played out in Accounting, Engineering, IT and Manufacturing, but never at the executive levels. Maybe we just don’t see it.
Now we are all worried that sales are down so the layoffs are a comin’. This is the time they should be using some of the cash reserves, and there is plenty, to actually fix problems instead of patching and making due. But we live in the era of big returns. If the company doesn’t show an ever growing profit then we will scare off the stock holders. But at some point running a skeleton staff has got to take its toll, not just on the company but the people that work here.
But then again what do I know, I didn’t go to an Ivy League school and I don’t get to look at the Big Picture down here in the trenches.
Stop dictating how others should run their businesses. The more interference in the market, the worse things will get. The economy crashing is the medicine we must take after years of credit expansion and a humongous debt consumer debt.
Well, it might help their bottom line short-term, but long-term, if they continue to lay off hard working folks just to please their shareholders, they'll soon be lining up with the rest of us in the soup kitchen lines because if you don't have a job, you can't buy their products or services.
It's fine to want to make money, but not at the expense and off the backs of hard-working people.
People over Profit!
Every time I see Jack Welch -- former CEO of GE -- being called upon by Charlie Rose and others as THE go-to business guru for sage advice on what's happening I just want to puke. He's the one who started this downsizing stuff for shareholder profitability and was hailed for his brilliance. So instead of making better things, greed took over and we simply got more profitable by cutting jobs. Following suit, AT&T (who has never completely recovered from their later PR fiasco) they let go thousands at a period of large profit for no good reason. I quit them as my telephone carrier as did many Americans and it hurt them but it didn't stop the trend. I LOVE that Obama speaks to greed at the top. I love that he suggests they take pay cuts when times are tough. He's setting the tone for a reversal of this cold movement that believes that average workers are not of value. He stresses that "we are all in this together." You simply can't continue to sink the middle class and expect that the top will still stay afloat. So I join the chorus hailing this blogger's comments and hope it is only the beginning.
but harvard teaches to scarp the worker to keep your income up. its just ivy greed business sense.
How dare he make common sense when the bosses might make a couple dollars less than they expected to this year. This is profit we are talking about damn it! Who cares about some dumb worker?
I remember reading about a businessman who in hard times layed off a few workers for 6 months, in which time they would receive unemployment benifits. He would then bring those workers back into the company and lay off another few other workers. This way the workers did not loose their skills and kept their dignity.
Sorry to say this but I think it is unAmerican to lay off workers to fatten the bottom line at this time.
Kudos to Diller. Layoffs by otherwise profitable and not-endangered companies are another version of the famous corporate greed culture still kicking back while being strangled by reality. Of course, some layoffs will have to occur as some companies get very small or go out of business. But that fact is being used as cover by the greedy or just incompetent. Another thing incredibly dumb is the Republican-led effort to bail out the banks. It isn't working as we see. This result stems from the Republican view to bail out the top of the economy first and do little to support the underlying problems. Now China is telling the U.S. to learn and practice some economic intelligence!
The Boards from each company needs to reconsider the multimillion $ salaries and perks. Reduce the salaries and no perks. Regardless of how much any company makes, it is not justifiable for anyone to make $30,000,000 in salary!!!!! Even the actors in Hollywood are paid too much while the public scrimps to buy a movie ticket.
Multimillion dollar salaries for CEOs and Hollywood stars are way overpaid, too. Last night on the way home I heard about this pitcher that the Yankees might be sign for a $100 million contract and that number was so jarring and grossly inappropriate.
Yep, the stupidest thing about any economic downturn is that companies start laying people off, further exacerbating the problem.
If people are unemployed... who's going to be able to buy anything???
Human being are such a deranged and idiotic species.
Keep buying Non American cars and the work dries up , Kick GM Ford and Chrysler out Send them to Canada with their employees and then you win you get your imports and you have no bail out . What winners you are Canada has a health programe that would cut GM Ford and Chryslers cost, think this would work a few billion to relocate and full payback in one year.
All of the big three already have multiple factories in Canada.
They moved there in the 80's precisely because of the government health care and pension systems, coupled with the high education level of the workers, yet fought tooth-and-nail to prevent the same thing from happening in the US in the 90's.
It's downright schizophrenic.
They also tried to build factories in Mexico and other low-wage countries, but the quality of the product was so low even they could not expand it any further.
What needs to happen is to Nationalize the big three, fire the entire upper management, and put a transition management team in place to guide the companies back to profitability. Once they are there, sell them off at a profit to the U.S. Treasury.
I am tired of all chief executives that get multimillion dollar salaries, good times or bad.
Me too. It's a disgrace. When a chain store closed in my area I was talking to the cashier. She said they were dismayed to be losing their jobs while the CEO was getting a $3 mill bonus! It just boggles the mind of saneness.
Dang, that dude is scary-looking.
We should be rebuilding our manufacturing base in the United States. If something needs to be manufactured, let's try to do it in the U.S. before going to China. We need a national campaign.
We need a law that punishes companies that outsource jobs if their employment cost is below 10% of the production cost (like software companies). HP outsourced to India entire divisions who were profitable, laying off senior programmers, while HP's profit increased by 1-2%. All to beat Wall Street expectations. The end result was stagnant wages and tapped out consumers, a process that over many years brought us into the current mess.
Their called tariffs. We used to have them.
the profits increased 1-2%, but you should see the Corporate jet and the 25 million dollar redocorating for that...
I do not believe for one minute that the executives are not taking 90% of the savings if that is the only difference in the profit.. The share holders are screwed again and the board of directors is in cahoots with management. Graef Chistal has been writing about this for the last 20 years...
The only way to restore some sanity with regard to the big boys is to put the income tax where it was before Reagan started trashing the economy AND MAKE it apply to alll income including bonuses, capital gains and dividends...
Relocate them in Canada cuts down on shipping
We need a SECRETARY OF INDUSTRIAL POLICY -- the most important new position the Obama administration could create. In Germany, for example, where they make the best cars in the world, the government, private sector and labor unions work closely together to find a way to benefit all.
Right now the US has a Russian - style capitalist system that is based on speculation and greed.
Russia and China are not the references for the US, instead it is GERMANY.
Please we need a SECRETARY OF INDUSTRIAL POLICY !!!!!!!!!!!!!!!!!!!!!!!!!!!!
I absolutely agree with this gentleman.
One of the reasons why so many banks are in trouble is the need to beat quarterly expectations. When Wall Street raises the bar on a quarterly basis, CEO's have to ramp up the risk to deliver. And, sooner or later, the risk taken is so high, it can threaten the entire company. Today a lot of credit unions are sound and safe, but a year ago Wall Street considered them the lowest form of banking and Lehman looked like geniuses.
Another reason why we're in trouble is CEO compensation, when coupled with quarterly expectations. CEO compensation is usually a function of stock performance. So if they take huge risks short term, they take home huge profits. Today a reckless CEO can make in 2 years as much as a prudent one makes in 10 years. The first delivers a burst and bust performance, the second a sound and safe few percent growth.
Wall Street needs to change the way is doing business, plain and simple.
not only banks that need to beat quarterly expectations but all corporations. So they don't spend their time and capital working on longterm projects and R&D
R&D...that's so old...the new thing is OS&LO - Out Souce and Lay Off
Instead of layoffs, why not salary cuts? Cut salaries in half and you can keep twice as many people. Start with making it mandatory that no CEO or management ears more than 20 times his or her lowest paid worker.
How about 700 times? This is how much the CEO of Ford - yes, a failing company - makes.
It is up to the board to craft these rules. The boards should be against any CEO compensation based on stock performance, moon phases or the weather. CEOs should get a hefty salary and that's it. Well, maybe a funky baseball cap and an iPod at the end of the year. Isn't a salary enough incentive? Apparently not...
A few second later, he added:
“It’s not that you don’t want to earn as much money as you can — it is your obligation, of course
Isn't that what Jesus told the rich young ruler? Wait, maybe there's something wrong with my copy of the New Testament. It doesn't even mention union busting and cutting the capital gains tax.
Lousy KJV. Where can I get the Gingrich-Hannity-O'Reilly translation?
STOP THE LAYOFFS...PLEASE!!!!!!!!!!!!!!!!!!!!!!!! TODAY!!!!!!!!!!!!!!!!!!!
you are justified in using all caps
talk with your fellow Americans next thing is no plants no lay offs, GM Ford and Chrysler don't need this relocating to Canada and shipping to the USA is good imports or as it has been don't buy American has put you out of work . Canada has a good health plan and Canada would welcome all the workers , and America gets it imports
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First Posted: 12- 4-08 08:56 PM | Updated: 01- 4-09 05:12 AM