How unions devastate the airline industry

[Petrel]

What categories of occupation are required to run an airline? The jobs that, if they are missing, you cannot fly? Rank them in importance to the passengers. Establish pay-scale accordingly. Devastation averted.

 

[RavenSky]

Except the problem with the airlines is that the pilots demand wages consistent with the expected airline revenue and in reality sometimes revenue is less than expected.

What about the CEO and board? Are their rewards for service rendered to the business always in line with company revenue? Are they willing to forgo a part of their salary, their perks and their bonuses and reduce their high incomes in order to help keep the cost of running the business down?

Everyone is so obsessed with what the top guys make--you're interested in destroying them, not in what actually works.

. That is a very weird accusation coming from the guy who is apparently obsessed with what senior pilots make.

 

[Loren Pechtel]

Except the problem with the airlines is that the pilots demand wages consistent with the expected airline revenue and in reality sometimes revenue is less than expected.

What about the CEO and board? Are their rewards for service rendered to the business always in line with company revenue? Are they willing to forgo a part of their salary, their perks and their bonuses and reduce their high incomes in order to help keep the cost of running the business down?

Everyone is so obsessed with what the top guys make--you're interested in destroying them, not in what actually works.

Deflection noted.

Odd how any increase in regular wages is met with arguments talking about destroying businesses and the economy but the same people making those arguments give a collective "meh" when you start talking about the incredible rise in executive salaries.

I don't like the rise in executive salaries but neither is it the bogeyman you think it is. The number of people getting the big figures are tiny.

 

[Loren Pechtel]

Once again, negotiating industry wide wages for a category of worker is the only way to eliminate wages as a competitive factor in pricing and in profits. If everyone in the industry has to pay the same wages that eliminates the pressure for any one company to push wages down in their company to gain an advantage over other companies. They have to compete in other areas to earn business.

It also reduces friction between the management and the workers in a company if wages are negotiated industry wide.

It is not just wages, it is working conditions. Employers are reluctant to, for example, reduce the work week or to increase vacation time because of competitive pressures. If the changes are industry wide this problem is eliminated. Reducing the work week is an obvious solution for under employment and for the displacement from automation.

In other words, a company must do what the union wants if it's to remain in business. That's a recipe for disaster.

 

[bilby]

Except the problem with the airlines is that the pilots demand wages consistent with the expected airline revenue and in reality sometimes revenue is less than expected.

What about the CEO and board? Are their rewards for service rendered to the business always in line with company revenue? Are they willing to forgo a part of their salary, their perks and their bonuses and reduce their high incomes in order to help keep the cost of running the business down?

Everyone is so obsessed with what the top guys make--you're interested in destroying them, not in what actually works.

Deflection noted.

Odd how any increase in regular wages is met with arguments talking about destroying businesses and the economy but the same people making those arguments give a collective "meh" when you start talking about the incredible rise in executive salaries.

I don't like the rise in executive salaries but neither is it the bogeyman you think it is. The number of people getting the big figures are tiny.

In that case, the impact of constraining their huge salaries will likewise be tiny; so there is no reason to oppose such constraints.

 

[ksen]

Deflection noted.

Odd how any increase in regular wages is met with arguments talking about destroying businesses and the economy but the same people making those arguments give a collective "meh" when you start talking about the incredible rise in executive salaries.

I don't like the rise in executive salaries but neither is it the bogeyman you think it is.

Neither are unions the bogeymen you think they are.

The number of people getting the big figures are tiny.

The number of people in unions and the number of people making MW are tiny, and yet that doesn't stop you and others from continually being scared to death of them.

 

[DBT]

Except the problem with the airlines is that the pilots demand wages consistent with the expected airline revenue and in reality sometimes revenue is less than expected.

What about the CEO and board? Are their rewards for service rendered to the business always in line with company revenue? Are they willing to forgo a part of their salary, their perks and their bonuses and reduce their high incomes in order to help keep the cost of running the business down?

Everyone is so obsessed with what the top guys make--you're interested in destroying them, not in what actually works.

It's not a matter of being obsessed, or being interested in 'destroying the top guys' but looking for some degree of fairness within the system. I'm not saying the top guys shouldn't get a decent remuneration for the skill and responsibility their position demands. If they are managing the business well, they should be rewarded. I'm just questioning the necessity of the sheer size and scale of their incomes, bonuses, perks, etc, at the best of times, but especially when the business they are managing is struggling.

 

[ksen]

In Loren's world scaling back CEO pay to only 50 times what workers make is "destroying them."

Too bad he's not that interested in the destruction of the working class by giving them a smaller and smaller piece of the economic pie.

 

[Underseer]

In Loren's world scaling back CEO pay to only 50 times what workers make is "destroying them."

Too bad he's not that interested in the destruction of the working class by giving them a smaller and smaller piece of the economic pie.

Why would he care about that?

As a libertarian, the only thing he cares about is the aristocracy. Only by stepping on the necks of the peasantry can we all become more free, hence the name "libertarian."

 

[ksen]

Honestly, I'm starting to think FreeTrader is a Loren sock or maybe vice versa.

 

[Loren Pechtel]

I don't like the rise in executive salaries but neither is it the bogeyman you think it is. The number of people getting the big figures are tiny.

In that case, the impact of constraining their huge salaries will likewise be tiny; so there is no reason to oppose such constraints.

Your conclusion does not follow.

The impact of cutting their salaries isn't in money, it's in the market failing to allocate the best managers most efficiently. The costs could be far in excess of the money involved.

- - - Updated - - -

Honestly, I'm starting to think FreeTrader is a Loren sock or maybe vice versa.

We have a very different take on welfare.

I believe there should be a reasonable safety net--but I believe it should come from the government. Trying to make business do it is dirty accounting and that's always a bad thing.

 

[laughing dog]

I don't like the rise in executive salaries but neither is it the bogeyman you think it is. The number of people getting the big figures are tiny.

In that case, the impact of constraining their huge salaries will likewise be tiny; so there is no reason to oppose such constraints.

Your conclusion does not follow.

The impact of cutting their salaries isn't in money, it's in the market failing to allocate the best managers most efficiently. The costs could be far in excess of the money involved.

Your conclusion does not follow, since your argument implicitly assumes these particular managers are not the best ones given the current state of the airline industry.

 

[fromderinside]

I've read a lot of S--t. So have we arrived at Shinola yet.

Just keep wondering how companies in an industry can use 16% of revenue for advertising. But, it will be devastated by being forced to bargain with a pilots union that only gets about 7% of the pie.

 

[coloradoatheist]

I've read a lot of S--t. So have we arrived at Shinola yet.

Just keep wondering how companies in an industry can use 16% of revenue for advertising. But, it will be devastated by being forced to bargain with a pilots union that only gets about 7% of the pie.

To be fair though, that 16% is actually the commissions they pay to the third parties who sell their tickets. So maybe the airlines should adopt the Southwest style and and only allow bookings through their own website.

I think the bigger problem with the pay structure of the pilots is the inexperienced pilots and longer shift and the concern for safety of the passengers.

 

[Loren Pechtel]

I've read a lot of S--t. So have we arrived at Shinola yet.

Just keep wondering how companies in an industry can use 16% of revenue for advertising. But, it will be devastated by being forced to bargain with a pilots union that only gets about 7% of the pie.

To be fair though, that 16% is actually the commissions they pay to the third parties who sell their tickets. So maybe the airlines should adopt the Southwest style and and only allow bookings through their own website.

And note that Southwest is out of the picture when you need multi-airline itineraries. It means that if you fly into a problem Southwest won't put you up on another airline. And how much are they spending on advertizing? I see more of their ads than anyone else's.

I think the bigger problem with the pay structure of the pilots is the inexperienced pilots and longer shift and the concern for safety of the passengers.

Yeah, that's one of the consequences. The guys at the bottom are flying too much, sleeping too little.

 

[Petrel]

Yeah, that's one of the consequences. The guys at the bottom are flying too much, sleeping too little.

And the scheduling is done by a union? So, what's the 1.5 mil CEO deciding - the colour of cocktail napkins? Not that that's unimportant....

 

[Canard DuJour]

I don't like the rise in executive salaries but neither is it the bogeyman you think it is. The number of people getting the big figures are tiny.

In that case, the impact of constraining their huge salaries will likewise be tiny; so there is no reason to oppose such constraints.

Your conclusion does not follow.

The impact of cutting their salaries isn't in money, it's in the market failing to allocate the best managers most efficiently. The costs could be far in excess of the money involved.

Yeah, whenever I buckle up for takeoff, the only parachute on my mind is the golden one for the CEO.

Any daft #^!@ can fly the plane.

 

[Loren Pechtel]

Yeah, that's one of the consequences. The guys at the bottom are flying too much, sleeping too little.

And the scheduling is done by a union? So, what's the 1.5 mil CEO deciding - the colour of cocktail napkins? Not that that's unimportant....

The union is the one divvying up the workload so the juniors are living like this.

 

[fromderinside]

To be fair though, that 16% is actually the commissions they pay to the third parties who sell their tickets. So maybe the airlines should adopt the Southwest style and and only allow bookings through their own website.

So you're saying that 16% actually represents discounts and payoffs for having customers? That doesn't sound like expense to me. That sounds like price discounting.

OK. Correct the operating expense picture and we still find pilots about eighth down the list of operating cost percentages.

Its a no win for Loren Pechtel's hyp-notized-osis however one cuts it. We need worker representation, all unions are bad, all unions are bad - we need regulation, all regulations are bad, all regulations are bad - we need society structure, all government is bad, all government is bad ..... OK, when I snap my fingers you will wake up and there will be no unions, no government, and no regulations - praise be to God.

 

[fromderinside]

Yeah, that's one of the consequences. The guys at the bottom are flying too much, sleeping too little.

And the scheduling is done by a union? So, what's the 1.5 mil CEO deciding - the colour of cocktail napkins? Not that that's unimportant....

The union is the one divvying up the workload so the juniors are living like this.

Why not answer the question Loren Pechtel? Is scheduling done by the pilots union? The answer is no. The scheduling is done by a company bureaucrat who takes rules and regulation into account then schedules pilots by seniority, experience and expertise, and submitted 'I wants'. Sure the junior pilots get the shitty flights, but, that doesn't account for over-scheduling them while giving the senior pilots sweetheart hours as you seem to be suggesting.

Certainly its not the union that's doing this. If it were a non-union shop the inexperienced and less qualified would probably be getting an even worse deal.

Companies are complaining because they don't want to pay anybody anything. so by point thier dirty fingers at senior highly qualified pilot salaries they are whining in an attempt to force the senior pilots to take pay cuts or permit managers to fire by discretion attending to no criteria other than corporate profit.

We are social animals. We need rules to act well together, businesses, being made bu us, consequently need rules to act well in the marketplace, and cheaters by nature need to be constrained.