Management And The Workers
General Motors, Ford, and Chrysler have submitted to the United States Congress their respective plan of operation if the federal government grants them the up to the $34 billion in emergency aid they have requested.
Part of the proposal entails a salary of $1 per year for the CEO of the three domestic automakers, Robert Nardelli (who already accepts only $1 in annual salary), Alan Mulally of Ford, and Rick Wagoner of General Motors.
That's a good start but, as this report from ABC News indicates, these chief executive officers still won't be homeless any more than the 32 heads of businesses in the Russell 3000 who take $1 a year in base salary have to apply for food stamps. Steve Jobs of Apple takes millions in stock options, owns millions of shares of company stock, and was given a Gulfstream Jet by Apple; Eric Schmidt of Google receiveds hundres of thousands of dollars from stocks and other bonuses and holds 9.5 milllion shares of company stock, currently worth $2.6 billion; Jerry Yang of Yahoo is a billionaire by virtue of founding the company and is a major stockholder; Jeffrey Katzenberg of Dreamworks Animation owns millions of shares, as well as stock and options vested, from recent years; Richard Kinder of Kinder Morgan Energy Products took in a cool $1 million in stock options in 1997; and Glenn Murphy of Gap, a relative pauper, earned $268,102 in "other compensation from the company."
The obvious question, then, is whether compensation of the chief executive officers aside from yearly salary would remain or even increase, and on what basis. But another: ABC News reports also
The UAW, scrambling to preserve jobs and benefits that could disappear with an automaker collapse, agreed to delay the companies' payments to a multibillion-dollar, union-run health care trust and scrap a jobs bank in which laid-off workers are paid most of their salaries, according to a UAW official who spoke on condition of anonymity because details had yet to be announced.
At an emergency meeting in Detroit, the union also agreed to restart contract talks with the Detroit Three to consider further givebacks.
The implicit threat to workers' health care obviously highlights the need to disengage the American health care system from employment or the profits of the insurance industry. Further, if the automakers, as is likely, receive substantial relief, will compensation to upper management revert to the exorbitant level at which it currently exists- and will employee benefits, cut in previous negotiated settlements, ever return even to the current level?
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