Why are these CEOs making millions....

[mefordis]

Why are these CEOs making millions....while their companies are in danger of bankrupcy? And why are they asking for government handouts/begging for socialism?

I'm all for VPs CEOs making millions if their companies are doing well, but what the heck is going on here? It's like stealing from their companies. And please don't say it is the unions destroying the companies. Because the jobs depend on the worker's ability to get by. It seems like the executives are the ones stealing from the companies.

A side note: GM is responsible for 5.6 billion $ each year for health care! Every single year for health care! They provide health care for over a million retirees, independents, employees. Viagra alone costs GM 17 million $ a year -- a cost that is passed onto the cost of each car. So if you drive a GM vehicle, you can thank yourself for helping someone's sex life!

 

[chisnpeke]

I wonder the same thing.

 

[Geoff_M]

Why... it's pretty simple. The coporate boards think that the CEO's in question are worth keeping around. In order to incent the the CEO's to not jump ship in the middle of the financial mess all three car companies are in and go work someplace else, they're offering them bonuses to stay on and try and turn the company around. I know that this doesn't seem "fair" to a lot of people, but if the CEO can stay and help turn things around, then spending a couple of million to save billions makes sense.

 

[SydneyBristow]

Probably the same reason the dealership my DH works at has laid off close to 30 people so far yet the owner has his own private jet.

 

[mefordis]

Why... it's pretty simple. The coporate boards think that the CEO's in question are worth keeping around. In order to incent the the CEO's to not jump ship in the middle of the financial mess all three car companies are in and go work someplace else, they're offering them bonuses to stay on and try and turn the company around. I know that this doesn't seem "fair" to a lot of people, but if the CEO can stay and help turn things around, then spending a couple of million to save billions makes sense.

But aren't these the CEOs that drove the companies into failure to begin with? Any CEO worth his or her salt should voluntarily take a pay cut if they are leading a business in danger of folding. Have confidence that they can get it back on track, then take the payoff.

 

[mefordis]

Probably the same reason the dealership my DH works at has laid off close to 30 people so far yet the owner has his own private jet.

Yeah, I'd say no government handouts but help the laid off employees.

 

[famofsix]

something is terribly amiss the way that the ones with the most money are virtually unscathed by these bail-outs

what happened to personal responsibility and ethics in running a business. This stuff doesn't happen overnight.

 

[Tanuki]

I think it's the same thing as an NBA player getting whatever his agent negotiated in his contract whether the team does well or not.

The problem is with whoever is signing off on these contracts. The stockholders should hold them responsible but with millions of shares floating around there is very little the stockholders can do - except sell which is why GM stock is now down to 1946 prices.

 

[Geoff_M]

But aren't these the CEOs that drove the companies into failure to begin with? Any CEO worth his or her salt should voluntarily take a pay cut if they are leading a business in danger of folding. Have confidence that they can get it back on track, then take the payoff.

The folk narrative is that "it's all the CEO's fault"... Let me ask you this, what specific actions of the CEO of Chrysler led to it's current condition? Was any of their current problems the result of external forces or being spun off by Daimler? Lastly, how many people would turn down the chance to run another company that's not currently circling the porcelain for the same salary instead of staying in the middle of the financial quagmire while slashing your pay as a pure "token" just because you're a "nice person"?

And sticking with Tanuki's sports analogy, time and time again, an underperforming athlete will be lured away to another team that's willing to offer "top dollar" because they think all the player needs is a change in environments to succeed with their organization. Sometimes it works, sometimes it doesn't. CEO's aren't much different.

 

[GeorgeG]

Why... it's pretty simple. The coporate boards think that the CEO's in question are worth keeping around. In order to incent the the CEO's to not jump ship in the middle of the financial mess all three car companies are in and go work someplace else, they're offering them bonuses to stay on and try and turn the company around. I know that this doesn't seem "fair" to a lot of people, but if the CEO can stay and help turn things around, then spending a couple of million to save billions makes sense.

I disagree. I've seen too many CEOs leave companies after they all but ruined them and they all leave with their pockets bulging.

We have gotten so pathetic that we reward failure and incompetence. What's really disgusting is that these CEOs don't even show a speck of shame.

The only CEO who did the right thing years ago was Lee Iacocca when he took a salary of only $1 a year with the rest of his compensation dependent on the company doing well.

The company I retired from hired a CEO some years back and he screwed things up so bad we were bought out, but he left with millions for just a few years worth of mess. During his tenure, every management employee was held to unusually strict conflict of interest standards... everyone of us but him. He had the company spend over $50 million dollars on a lousy software package that wasn't worth $10 thousand. We had all kinds of problems for the better part of two years. I was one of the more vocal detractors (I tend to call a pig a pig) and was finally told to keep my mouth shut. Turned out this CEO's wife worked for the software company.

It's just not the top positions with a lot of companies and corporations. We had a saying for years that if you really wanted a good promotion you had to really screw something up. I can't begin to tell you how many incompetent managers I've seen promoted just to get them out of trouble. Fortunately, they usually get to a point where there is no place left the company can take a chance on and the next step is "special projects." So, they still keep a job with a good salary and benefits and not get fired. That's usually because they were brought into the company by one of the top executives who just will not admit they made a mistake.

 

[NY Disney fan]

Bad CEOs deserve to get paid. Do they deserve bonuses?? Absolutely not.

 

[Micca]

I have a feeling the packages for CEOs are going to change substantially over the next few years. Stockholders are just not going to stand for CEOs wrecking the business and walking away with millions. Also look for that golden parachute paradigm to shift dramtically. I hope.

 

[Geoff_M]

I disagree. I've seen too many CEOs leave companies after they all but ruined them and they all leave with their pockets bulging.

We have gotten so pathetic that we reward failure and incompetence. What's really disgusting is that these CEOs don't even show a speck of shame.

The only CEO who did the right thing years ago was Lee Iacocca when he took a salary of only $1 a year with the rest of his compensation dependent on the company doing well.

George, you're right... but we talking about specific CEOs and not ones in general. I saw on the front page headline of the Detroit Free Press as I got my morning coffee at the gas station this morning that Chrysler's board is giving their CEO a bonus because they want him to stay. In this case, I don't think the guys has been at the helm long enough, after being spun off by Daimler, to make much head way (or damage, for that matter). So why should the guy be obligated to follow the Iacocca model and make a token PR move to "cut" his pay/bonuses when he can also look at working someplace else and save himself a bunch of grief???

 

[Kim&Chris]

I have a feeling the packages for CEOs are going to change substantially over the next few years. Stockholders are just not going to stand for CEOs wrecking the business and walking away with millions. Also look for that golden parachute paradigm to shift dramtically. I hope.

I'd LOVE to see this.

These CEO's bounce from company to company, bringing their own people in and ultimately destroying companies with their idiotic ideas. Then, once they've gotten the company to the point of bankruptcy, the company 'fires' them and they walk away with millions and years of free COBRA coverage, thanks to their negotiated contracts. And the 'little guy' earning just enough to live, gets the boot with nothing but the opportunity to apply for unemployment.

This nonsense HAS to end.

 

[DisMN]

I disagree. I've seen too many CEOs leave companies after they all but ruined them and they all leave with their pockets bulging.

We have gotten so pathetic that we reward failure and incompetence. What's really disgusting is that these CEOs don't even show a speck of shame.

The only CEO who did the right thing years ago was Lee Iacocca when he took a salary of only $1 a year with the rest of his compensation dependent on the company doing well.

The company I retired from hired a CEO some years back and he screwed things up so bad we were bought out, but he left with millions for just a few years worth of mess. During his tenure, every management employee was held to unusually strict conflict of interest standards... everyone of us but him. He had the company spend over $50 million dollars on a lousy software package that wasn't worth $10 thousand. We had all kinds of problems for the better part of two years. I was one of the more vocal detractors (I tend to call a pig a pig) and was finally told to keep my mouth shut. Turned out this CEO's wife worked for the software company.

It's just not the top positions with a lot of companies and corporations. We had a saying for years that if you really wanted a good promotion you had to really screw something up. I can't begin to tell you how many incompetent managers I've seen promoted just to get them out of trouble. Fortunately, they usually get to a point where there is no place left the company can take a chance on and the next step is "special projects." So, they still keep a job with a good salary and benefits and not get fired. That's usually because they were brought into the company by one of the top executives who just will not admit they made a mistake.

Every word you said is true and I've seen all these things happen in the company DH worked for.
You forgot to add though, that when the CEO takes the money and runs, the company ends up in bankruptcy AND.........the little guys lose everything, including their pension.
I have to tell you that hurt a LOT watching several of the top guys at DH's company walk away with pockets overflowing with money while we sat here stunned and stripped of a 30 yr pension. It's horrible and I blame the CEO's not the unions.

 

[blu3d3vil]

I wonder why Hollywood actors are making millions more than CEO's and voting for socialism - and no one seems to care.

 

[cteddiesgirl]

Why... it's pretty simple. The coporate boards think that the CEO's in question are worth keeping around. In order to incent the the CEO's to not jump ship in the middle of the financial mess all three car companies are in and go work someplace else, they're offering them bonuses to stay on and try and turn the company around. I know that this doesn't seem "fair" to a lot of people, but if the CEO can stay and help turn things around, then spending a couple of million to save billions makes sense.

If they couldn't run the company successfully, who cares if they go. How can they turn the company around if they've done nothing to keep it successful?

If the company is failing, it's their own fault. They obviously need some new and better blood to keep the company running a hopefully prospering.

 

[undertheradar]

ADD this to the Wall Street firms receiving government bailouts that plan on awarding bonuses. What is a bigger slap to the taxpayers?

 

[mefordis]

An owner of a sports team can do whatever he wishes. Sports teams are not publicly traded. These companies paying their CEO's unreasonable salaries and bonuses for leading underperforming companies are publicly traded and need to be responsible.

If a CEO is confident in his ability to lead a company to success, his high compensation should be delayed until he meets success markers. I wouldn't bail out these companies with salaries and bonuses that unreasonable. Lowering them would be a contingency.

The folk narrative is that "it's all the CEO's fault"... Let me ask you this, what specific actions of the CEO of Chrysler led to it's current condition? Was any of their current problems the result of external forces or being spun off by Daimler? Lastly, how many people would turn down the chance to run another company that's not currently circling the porcelain for the same salary instead of staying in the middle of the financial quagmire while slashing your pay as a pure "token" just because you're a "nice person"?

And sticking with Tanuki's sports analogy, time and time again, an underperforming athlete will be lured away to another team that's willing to offer "top dollar" because they think all the player needs is a change in environments to succeed with their organization. Sometimes it works, sometimes it doesn't. CEO's aren't much different.

 

[zulaya]

Why... it's pretty simple. The coporate boards think that the CEO's in question are worth keeping around. In order to incent the the CEO's to not jump ship in the middle of the financial mess all three car companies are in and go work someplace else, they're offering them bonuses to stay on and try and turn the company around. I know that this doesn't seem "fair" to a lot of people, but if the CEO can stay and help turn things around, then spending a couple of million to save billions makes sense.

I've heard this before...and not directing this to the poster I quoted, just the business world in general...where do you think they are going to get another job if they'd screwed up so bad? And if they've screwed up so bad, why wouldn't you take a chance on someone else who probably has a fresh outlook on how to handle a problem, not be hip dip if company crap and not able to see the big picture.

I just don't get how these boards think that there aren't other qualified people ~ maybe not current CEOS ~ but other qualified professionals who CAN step in and get the job done and you don't need to pay MILLIONS for it. A reasonable salary ~ and I'm sorry, MILLIONS as your salary is not reasonable unless your company is smokin' in the business world ~ and NO BONUS whatsoever unless you meet significant above average expectations. A BONUS is supposed to be extra for a job well done...not a job done half- ***ed. (I starred myself since it probably would be starred for me.)