Boeing’s top executive explains why it crashed

Sharing is Caring!

by Fabius Maximus

Summary: Boeing has crashed. We can only guess at the boardroom action that put it on that course. But on rare occasions, they speak frankly. Like these words by Boeing’s top executive in 2014. We didn’t listen, but it’s not too late for us to learn.

Look in the eyes of our corporate rulers.

Dollar sign in pupil of an eye
ID 35765159 © Gajus | Dreamstime.

Michael Kinsey’s definition of a gaffe “is when a politician tells the truth – an obvious truth he isn’t supposed to say.” As in this from the quarterly earnings conference call on 24 July 2014 with Boeing’s senior management, when the CEO blurted out a hidden truth.

Bloomberg News:  Jim, you have a birthday coming up next month. …Will you be at your desk, and has the Board approved you staying on past age 65?

Jim McNerney, CEO: Yes, the heart will still be beating. The employees will still be cowering {laughing}. I’ll be working hard; there’s no end in sight. We’re continuing to build the succession plan …But there’s no discussion of it yet. So you’ll still be asking questions of me.

Jim McNerney was President, CEO, and Chairman of Boeing from 2005 through 2015. He was Chairman in 2016. He learned that workers are cattle while working from 1982 – 2001 as an executive at GE under an architect of modern corporate America – Jack Welch. Under his leadership, Boeing decayed to a shell of the once-great aerospace giant. For this he was lavishly paid. He earned $80 million in 2013-2015 and retired with a $4 million for 15 years pension – plus uncountable other perks.

Boeing has worked hard to demoralize its workers (the most recent round early this year). In 2014, McNerney exulted in his success. Six years later, Boeing reaped the consequences of treating their highly skilled workers like cattle. This is one of the reasons that America’s giant corporations are decaying. It is one of the great trends of our time, ignored (as usual) by the news media.

Boeing and other leaders of American businesses – such as AmazonNikeand Walmart – have forged a new corporate-worker relationship. They have weakened or broken their unions. They converted many of their workers into a contingent, low wage, no benefit peons – and outsourced jobs to lower-wage nations.

As a result, wages as a fraction of America’s gross domestic income (GDI) fell from 59% in 1970 to 53% in 2018. And corporate profits rose from 4.5% to 6.6% of GDI. This is a victory on scale rarely seen in our history. It’s natural that their great success creates contempt for their employees.

Compensation of employees as a percent of Gross Domestic Income.

Compensation of Employees as a percent of GDI

 

McNerney’s thinking is that of our ruling elites. As seen in Mitt Romney’s most famous speech during the 2012 campaign.

“There are 47% of the people who will vote for the president no matter what. All right, there are 47% who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. That’s an entitlement.

“And the government should give it to them. And they will vote for this president no matter what …These are people who pay no income tax …[M]y job is is not to worry about those people. I’ll never convince them they should take personal responsibility and care for their lives.”

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How should we react to this information? Anger might motivate us to act, as described in these posts. Pride might motivate us to act.  See these posts for more information about steps to political reform in America. Whatever we do, we must do soon. Our ruling elites grow more powerful every years. The clock might be running out on us as a New America arises on the ashes of the America-that-once-was.

“Nothing is written.”
— Good news said by Lawrence of Arabia in the 1962 film

 

 

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