Ralph Nader letter: unsafe at any speed
02-16-2015, 03:11 PM
#11
Gets Weekends Off
Joined APC: Jul 2010
Position: window seat
Posts: 12,522
Originally Posted by Packrat
So you all think its better for the airlines to spend millions on stock buybacks instead of improved medical, improved retirement and/or improved pay for the employees? Is that right?
It would be nice to think profits don't matter and labor can corral every penny of it but that's clearly not realistic. Labor has been getting more (still not enough though) and billions have been thrown at the product as well, yet the populist provocateur has been acting like the customer is getting fleeced and he clearly wants fees rolled back (and probably regulations increased), thus reducing the very profits we're talking about in the first place.
And not all airlines are increasing outsourcing. There has been some maintenence insourcing/growth at some airlines as well as more block hours and seats being flown by mainlines compared to their regionals. More needs to be done, but he's just playing buzzword cards trying to get some traction and attention. Profits are evil and should be turned into taxes and then almighty government could put a chicken in every pot and a Corvair in every garage.
02-16-2015, 04:49 PM
#14
Gets Weekends Off
Joined APC: Jun 2010
Position: 747 Captain, retired
Posts: 928
Originally Posted by Plunder Hound
I'm on the outside at United looking in wondering if I'll ever go back (2000 hire). Not a huge Ralph fan, but he makes some good points.
Dear Mr. Smisek,
Two stories have come to public attention about your airline, which invites some serious introspection by you and your fellow executives who make millions of dollars a year.
The first appeared in the January 23, 2015 edition of the Wall Street Journal titled, "Suddenly Flush Airlines Debate How to Use Cash." The article posed the choices: for increased services for consumers and reduced fares; for investors to cut debt and buy back stock. There was no indication of a cash dividend increase. Then this paragraph: "United returned $320 million to shareholders last year through share repurchases, and it said Thursday it could accelerate its buybacks with extra cash flow." Stock buybacks -- really a poor use of productive capital -- are favored by executive suites as a way to elevate executive compensation compared to cash dividends.
Now comes the second story that was not so widely publicized. Your subordinates have been instructed to outsource 2,000 union jobs under a vendor bidding process that you will throw against your loyal skilled workers to match, or else. Twenty-eight stations at airports are affected in this round. You hope to save $2.7 million out of the pay of long-time United Airlines workers (many who make $15 per hour and benefits) on the tarmac at dawn or dusk, and rain, snow or shine.
Do these two stories prod you to wonder what's going on in your monetized mind that excludes common decency and elemental labor management relations? Do you think that vendors' lower paid, inexperienced labor pool is not going to cause you problems down the road?
And does a merged airline (with Continental) planning more unproductive stock buybacks to pile on the $320 million in 2014 have any qualms squeezing 2,000 already hard-pressed workers with families out of $2.7 million (not to mention other similar plans, past and future), astonishingly at a time of record profits? Squeezing appears to be your corporate policy tool for your passengers as well -- for example, squeezing their leg room, squeezing them by innumerable fees and penalties, and squeezing their time by delays on the phone in responding to their questions.
Why is it that a far tighter oligopoly of domestic airlines than before deregulation mimics each other's race to the bottom in labor and consumer relations, instead of mimicking better practices by Southwest Airlines with a far more consistent record of profits and no layoffs? Does this perverse behavior also make you wonder?
Mr. Smisek, you're pushing the envelopes in ways that reflect a power trip -- that is if you can get away with it, you will. At this point I am reminded of the courteous UAL of the Sixties, Seventies and early Eighties with services and attentiveness, with a fine record of domestic maintenance standards. That history should provide you with some contemplation about the role of top management over the years.
Consider this advice: drop the risky outsourcing; treat your employees as Southwest does; and stop ratcheting up the fees for baggage, changes of reservations, etc. Unless, that is, you believe that customer backlash, investigations by media and lawmakers and lower job gratification are not anywhere on your horizon.
Your response is welcomed.
Sincerely,
Ralph Nader
Dear Mr. Smisek,
Two stories have come to public attention about your airline, which invites some serious introspection by you and your fellow executives who make millions of dollars a year.
The first appeared in the January 23, 2015 edition of the Wall Street Journal titled, "Suddenly Flush Airlines Debate How to Use Cash." The article posed the choices: for increased services for consumers and reduced fares; for investors to cut debt and buy back stock. There was no indication of a cash dividend increase. Then this paragraph: "United returned $320 million to shareholders last year through share repurchases, and it said Thursday it could accelerate its buybacks with extra cash flow." Stock buybacks -- really a poor use of productive capital -- are favored by executive suites as a way to elevate executive compensation compared to cash dividends.
Now comes the second story that was not so widely publicized. Your subordinates have been instructed to outsource 2,000 union jobs under a vendor bidding process that you will throw against your loyal skilled workers to match, or else. Twenty-eight stations at airports are affected in this round. You hope to save $2.7 million out of the pay of long-time United Airlines workers (many who make $15 per hour and benefits) on the tarmac at dawn or dusk, and rain, snow or shine.
Do these two stories prod you to wonder what's going on in your monetized mind that excludes common decency and elemental labor management relations? Do you think that vendors' lower paid, inexperienced labor pool is not going to cause you problems down the road?
And does a merged airline (with Continental) planning more unproductive stock buybacks to pile on the $320 million in 2014 have any qualms squeezing 2,000 already hard-pressed workers with families out of $2.7 million (not to mention other similar plans, past and future), astonishingly at a time of record profits? Squeezing appears to be your corporate policy tool for your passengers as well -- for example, squeezing their leg room, squeezing them by innumerable fees and penalties, and squeezing their time by delays on the phone in responding to their questions.
Why is it that a far tighter oligopoly of domestic airlines than before deregulation mimics each other's race to the bottom in labor and consumer relations, instead of mimicking better practices by Southwest Airlines with a far more consistent record of profits and no layoffs? Does this perverse behavior also make you wonder?
Mr. Smisek, you're pushing the envelopes in ways that reflect a power trip -- that is if you can get away with it, you will. At this point I am reminded of the courteous UAL of the Sixties, Seventies and early Eighties with services and attentiveness, with a fine record of domestic maintenance standards. That history should provide you with some contemplation about the role of top management over the years.
Consider this advice: drop the risky outsourcing; treat your employees as Southwest does; and stop ratcheting up the fees for baggage, changes of reservations, etc. Unless, that is, you believe that customer backlash, investigations by media and lawmakers and lower job gratification are not anywhere on your horizon.
Your response is welcomed.
Sincerely,
Ralph Nader
02-16-2015, 04:52 PM
#15
Gets Weekends Off
Joined APC: Nov 2013
Position: Gets weekends off
Posts: 1,168
Simply put, management stock bonuses are based on their total percentage ownership of the company. So if management owes 1% of the company throught stock agreements, and they blow $1B to buy back 10% of the shares, they now own 1.1%, so they get a 10% increase in their stock bonuses. They are essentially using company profits to buy themselves a higher percentage ownership of the company. Its like dilution in reverse.
Once all the shares have been repurchased, only management will own shares. Effectively they could BUY all of United and own it, using the profits we generated to benefit them.
None of this helps the company later if we have financial difficulties. When they talk about doing this to benefit "shareholders", the only shareholders they want to benefit are themselves.
Once all the shares have been repurchased, only management will own shares. Effectively they could BUY all of United and own it, using the profits we generated to benefit them.
None of this helps the company later if we have financial difficulties. When they talk about doing this to benefit "shareholders", the only shareholders they want to benefit are themselves.
02-16-2015, 05:05 PM
#16
Gets Weekends Off
Joined APC: Apr 2007
Posts: 880
Easy killer. I think they all are garbage and a systemic problem to the American workforce. Corporate American and only concern for shareholders and their own pockets is a cancer that we must cure. How about reading what I say with a different lens? Maybe pot meet kettle?
02-16-2015, 05:08 PM
#17
Gets Weekends Off
Joined APC: May 2009
Position: The GF of FUPM
Posts: 3,073
Originally Posted by krudawg
Why are you wasting our time with anything Ralph Nader allegedly wrote. It won't be long before we start discussing the safety of the Corvair.
Last edited by oldmako; 02-16-2015 at 05:21 PM.
02-16-2015, 06:29 PM
#19
Gets Weekends Off
Joined APC: Feb 2015
Position: Downward Dog
Posts: 1,877
Originally Posted by mike734
While reading that letter, I couldn't help think it was written by a petulant child. Then I saw it was by Ralph Nader.
02-16-2015, 06:38 PM
#20
Gets Weekends Off
Joined APC: Jun 2010
Position: DOWNGRADE COMPLETE: Thanks Gary. Thanks SWAPA.
Posts: 6,605
Originally Posted by Rolf
Southwest is certainly testing boundaries. I sure hope Mr Kelly wakes up before it's too late.
Really, for us the ONLY question is what is the pilot group willing to do to get the insanely reasonable contract improvements that we seek. Forget about being released to self-help. SWA is a huge part of the country's infrastructure. Ain't gonna happen, especially considering how much political inroads Kelly obviously has.
So if you really think about it, it all comes down to gumption, the logbook, and the parking brake. From what I'm witnessing out on line, we're phooked.
Sorry for the thread drift, fellas.
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