Kilroy Was Here
April 24, 2003
The Ignorance of CEOs
American Airlines CEO Donald Carty seems so surprised at the response of unions to hearing that executives at AA were to receive "retention bonuses".
Just another tale of the unabashed greed among today's corporate executives. On the right hand, American Airlines has been clubbing the working men and women of AA with the threat of bankrupcy unless they make wage concessions, cut benefits, and work more for their money.
On the left hand, American funds the pensions of its top executives and offers them bonuses of twice their salary if they stay until 2005. That would mean a bonus of $1.6 million dollars for CEO Donald Carty himself. This at a time when American Airlines has lost $5.2 billion over the last two years and expects to lose another $800 million this year.
How can executives be surprised at the unions response? Well, they could only be surprised if this type of avarice were so commonplace as to become an industry standard. But that couldn't be the case, could it?
"This is a fairly standard retention package, and I think the market understands that," said Stuart Klaskin, an airline consultant with Klaskin, Kushner & Co. in Coral Gables, Fla. "The real problem was the terribly bad timing in disclosing it."
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