Case study of General Electric Company - The politics and corruption of CEO pay

[RVonse]

Here: http://www.dw.com/en/how-general-electric-became-a-general-disappointment/a-42542423

This article mostly talks about GE itself but along the way makes a few obvious statements about executive behavior at GE.

Although the American engineering conglomerate claimed not to overcompensate executives, former CEO Jeff Immelt stepped down in 2017 with a retirement package worth upwards of $211 million (€171.1 million), while GE posted a $9.8 billion loss for last year. Something just doesn't add up.

...In 2001, Welch received the largest retirement package in history. Valued at $420 million, it included access to an $80,000-per-month Manhattan apartment, tickets to elite sporting events and lifelong use of airplanes and other GE facilities.

During his tenure, it was not uncommong for Immelt to take company aircrafts to business meetings, often having an empty jet follow behind, just in case.

Its pretty obvious that at GE, there is no relationship between job performance and pay for the CEO's. Which is also how it goes with about 99% of all the other US corporations IMO. Everyone that is honest about this knows this. But where it gets interesting to me is that paradoxically, the far right and the far left are in perfect agreement when it comes to CEO pay. Take far right Alex Jones for example, I have heard him make plenty of statements in opposition to the corruption of CEO. Listening to far right Jones sounds exactly the same as far left Bernie Sanders. See here for example: https://www.youtube.com/watch?v=suN-9FrBi7E

So the far left and the far right both knew and continue to know CEO pay is a huge scam in the US. But in contrast to those politics, it is the moderate left....say someone like Hillary Clinton or someone from the moderate right like either Jeb, W Bush, or Mitt Romney. You would hear nothing about problems with CEO corruption with any of those people. They would tell you it is the normal and part of the free market system.

Why is this? IMO it is an important question that never gets asked or answered. I say this for all the Trump haters. Because for all his faults, I'm willing to bet Trump would also tell the truth about CEO corporate corruption. And just this 1 issue..... not understanding why CEO corruption does not get addressed by "the normal politicians" is going to be why we will continue to see politicians like Trump in the future. IMO, when the moderate politicians either can't see or can't address when the king of crony capitalism is without clothes, the ordinary people are still going to vote for someone who does see this kind of stuff. And we will see someone else in the future even more radical than either Trump or Bernie next time around.

 

[PyramidHead]

I say this for all the Trump haters. Because for all his faults, I'm willing to bet Trump would also tell the truth about CEO corporate corruption. And just this 1 issue..... not understanding why CEO corruption does not get addressed by "the normal politicians" is going to be why we will continue to see politicians like Trump in the future. IMO, when the moderate politicians either can't see or can't address when the king of crony capitalism is without clothes, the ordinary people are still going to vote for someone who does see this kind of stuff.

Trump is a textbook crony capitalist who has absolutely no problem with exorbitant CEO pay. He is not the radical you make him out to be.

 

[RVonse]

You are saying approximately 1/2 the population of the US thought Trump was the "business as usual" candidate?

 

[funinspace]

Why is this? IMO it is an important question that never gets asked or answered. I say this for all the Trump haters. Because for all his faults, I'm willing to bet Trump would also tell the truth about CEO corporate corruption.

Yeah, that must be by Don the Con has a basket full of former CEO's and billionaires in his administration. Hope you aren't holding your breath...

You are saying approximately 1/2 the population of the US thought Trump was the "business as usual" candidate?

Is this the same 1/2 of voters (not population) that voted back in the same old congressional critters, that control the purse strings?

Funny how one year in, FFvC has set records for lowest job approval ratings, since polling started. Hell, Pres. Ford even beats this con man after pardoning Nixon.

 

[untermensche]

In the corporate world as it is presently configured managing officers are paid as much as possible.

It is an insane non-sustainable system.

Human greed knows no bounds.

It has no sense.

 

[PyramidHead]

You are saying approximately 1/2 the population of the US thought Trump was the "business as usual" candidate?

No, they were duped. Including you.

 

[SimpleDon]

Here: http://www.dw.com/en/how-general-electric-became-a-general-disappointment/a-42542423

This article mostly talks about GE itself but along the way makes a few obvious statements about executive behavior at GE.

Although the American engineering conglomerate claimed not to overcompensate executives, former CEO Jeff Immelt stepped down in 2017 with a retirement package worth upwards of $211 million (€171.1 million), while GE posted a $9.8 billion loss for last year. Something just doesn't add up.

...In 2001, Welch received the largest retirement package in history. Valued at $420 million, it included access to an $80,000-per-month Manhattan apartment, tickets to elite sporting events and lifelong use of airplanes and other GE facilities.

During his tenure, it was not uncommong for Immelt to take company aircrafts to business meetings, often having an empty jet follow behind, just in case.

Its pretty obvious that at GE, there is no relationship between job performance and pay for the CEO's. Which is also how it goes with about 99% of all the other US corporations IMO. Everyone that is honest about this knows this. But where it gets interesting to me is that paradoxically, the far right and the far left are in perfect agreement when it comes to CEO pay. Take far right Alex Jones for example, I have heard him make plenty of statements in opposition to the corruption of CEO. Listening to far right Jones sounds exactly the same as far left Bernie Sanders. See here for example: https://www.youtube.com/watch?v=suN-9FrBi7E

So the far left and the far right both knew and continue to know CEO pay is a huge scam in the US. But in contrast to those politics, it is the moderate left....say someone like Hillary Clinton or someone from the moderate right like either Jeb, W Bush, or Mitt Romney. You would hear nothing about problems with CEO corruption with any of those people. They would tell you it is the normal and part of the free market system.

Why is this? IMO it is an important question that never gets asked or answered. I say this for all the Trump haters. Because for all his faults, I'm willing to bet Trump would also tell the truth about CEO corporate corruption. And just this 1 issue..... not understanding why CEO corruption does not get addressed by "the normal politicians" is going to be why we will continue to see politicians like Trump in the future. IMO, when the moderate politicians either can't see or can't address when the king of crony capitalism is without clothes, the ordinary people are still going to vote for someone who does see this kind of stuff. And we will see someone else in the future even more radical than either Trump or Bernie next time around.

I was an electrical engineer in heavy industry, i.e. high capital cost construction, in building materials, primary metals, rare earth minerals, coal mining and processing, diamonds, gold, aluminum, etc. We worked primarily with GE in the 1980's because of their industry specialists and their experience overseas, where we could partner with them helping each other to get contracts. Over the years we watched GE slowly degenerate. The industry specialists all retired and GE didn't replace them. Their company turned into a company that would sell you anything that you could tell them that they made, but not a company that could put together a complete package for a plant all of which worked together. I found myself introducing GE employees to each other who are responsible for a large mill drive motor and the switchgear that started and protected the motor for example. We energized switchgear that had current measuring transformers wired incorrectly that immediately caught fire, switchgear that obviously had never been tested in their shops.

We slowly started to work with ABB, the Swiss and Swedish company, and occasionally with the German company, Siemens. Both now sell more electrical equipment in the US than GE does.

GE is a perfect example of the destructive power of the inflation in the stock market. As we give the 1% increasingly large tax cuts and reduce the taxes on corporations all of this money floods into the stock market, it produces inflation in the stock market. The stockholders expect ever increasing profits from the corporation commensurate with how much they paid for the stock. But the corporation didn't receive any money from the higher valuation of the stock, the gain in the value of the stock from the inflation in the stock price. This inflation is called capital gains, but it is nothing more than inflation in the cost of the shares. The corporation has to go to extremes to generate the returns that the stockholders expect, without any additional capital to do it with. The corporations have no choice but to borrow money.

Yes, they over pay their CEO's and probably two levels of their executives. But they have to, they are in such poor shape that no one decent would work for them otherwise. They are hemorrhaging talent in the company. No one wants to work for them.

I say this for all the Trump haters. Because for all his faults, I'm willing to bet Trump would also tell the truth about CEO corporate corruption. And just this 1 issue..... not understanding why CEO corruption does not get addressed by "the normal politicians" is going to be why we will continue to see politicians like Trump in the future. IMO, when the moderate politicians either can't see or can't address when the king of crony capitalism is without clothes, the ordinary people are still going to vote for someone who does see this kind of stuff. And we will see someone else in the future even more radical than either Trump or Bernie next time around.

Trump and others like him will keep getting elected as long as there are fools that believe that Trump is somehow the champion of the working class. Since he was elected the Trump properties in Florida have hired about 140 people. All but one are immigrants working under H1B1 visas. The only legislation that the majority Republicans have been able to pass is a massive tax cut which permanently lowers taxes benefiting the 1% for 80% of the cuts. And they loosened the restrictions for the mentally ill to purchase guns.

Are you mentally ill or in the 1%?

Trump promised to clamp down on Wall Street. Did you think that he meant by populating his cabinet with people from Wall Street?

The big advantage of a capitalistic economy is that the goal of it is so easy to understand, making money, that idiots understand it and can be successful. But the other, more complex about 40% part of the economy requires balancing many different and competing interests. This is why businessmen can't run the government better, this why businessmen can't run health care better, this is why businessmen can't run education better than government can. The Trump administration is living proof of this simple fact.

 

[Horatio Parker]

Since Trump is a CEO and so are his buddies, I highly doubt he considers them corrupt or overpaid.

 

[funinspace]

Since Trump is a CEO and so are his buddies, I highly doubt he considers them corrupt or overpaid.

Just thought it worth pointing out that Don the Con is the CEO(s) of his privately held LLC's, which is significantly different than being the CEO of a public corporation.

 

[Playball40]

Isn't GE the one that brainwashed Ronald Reagan?