What are "prevailing equities"
 

In the hearings in D.C., Mr. Bloch made two important points on what the arbitrators thought was important when creating a list.

"The first, of course, is to create a list that recognizes the prevailing equities of the new relationship, some points on that, just a small digression. Numerous witnesses have alluded to the fact that this is a conglomeration of equals. You differ as to how equal, but I think Dr.Campbell was essentially correct in speaking of this being a merger and not some sort of an acquisition. I don't hear any serious argument from either side that one company is the savior of the other in this. And secondly, there is no doubt that you -- and I know that we -- will not cure the inequities, real or perceived, of the past, nor can we isolate or insulate anyone against the vagaries of the future. Talk about career expectations in this industry is a little like dreaming about income expectations and investment opportunities at a roulette table."

So, what's a current prevailing equity? Because it appears that prevailing equities brought to the merger will dominate the decision. Not future expectations or perceived inequities of the past.

If you edited some of the muttering and digression his statement boils down to this.

The first, of course, is to create a list that recognizes the prevailing equities of the new relationship. And secondly we will not cure the inequities, real or perceived, of the past, nor can we isolate or insulate anyone against the vagaries of the future. Talk about career expectations in this industry is a little like dreaming about income expectations and investment opportunities at a roulette table.

You've zoned in on one of the very important points, in my view. My interpretation of Bloch's use of the term "prevailing equities of the new relationship" is a reiteration of his comment that the arbitration board essentially agrees that neither airline is saving the other, and they view this as a merger of equals. Using the term "prevailing equitites of the new relationship" is shorthand for the board's overall view of the two companies and what they brought to the merger.

A bigger question for me is; why would he have said it? I have a strong suspicion as to why, but it's obviously only my opinon.

The comment of not being able to cure the inequities of the past is rather obvious. The comment of not being able to isolate or insulate anyone against the vagaries of the future means (I think) that they are going to use the tried and true method of taking a snapshot at some point (constructive notice, corporate closure, end of firm aircraft orders, etc.) and construct a list.

The only other question is, will they use the computer programs we've provided them to move the list forward into the future to see how the list will look down the road.

Carl

Carl,
Using a computer program to see how the list will look down the road sounds a lot like "isolating or insulating against the vagaries of the future."

And Carl we all what Yogi thinks about that. :)

Scoop

With one exception: Attrition is not a vagary, it's a statistical certainty. The NWA/REP arbitration used the attrition "look ahead" to decide how long the fences should be. With Bloch saying they hoped to craft a list that the pilots could live with now and in the future, it leads me to believe they will look at the attrition equation in any proposal they are contemplating.

Carl

But is garanteeing future advancement based on that attrition a statistical certainty, within the context of this merger? I don't believe he set any priorities as to which basis for future expectations is more valid or more vague. The "now and in the future" comment is pretty general, unobjectionable platitude, I doubt he gave a little "wink" ;)to the NW side when he said it.

I kind of home'd in on the quote about not solving the inequities of the past. I suspect he is talking about the Red/Green issue. (If not then what?) If that is correct then it could be a blow to a DOH list. Just thinking out loud........probably shouldn't do that!!!!!:D

Not to change the subject, but has any one looked at the seniority list put out on a website called isoprepanalysis dot com? Looks like a straight ratio.

My understanding of the term "Prevailing Equities" concerns the status quo on what the value of a specific DOH brings to each pilot on each list. I have a lot of friends at NWA. Some hired before and some after me. Even those hired several years ahead of me fly lower paying equipment and don't enjoy the quality of life that I do. One of them the other day asked if I ever fly when I commented on how I never see him. (Yes, I do like 9 to 10 day a month schedules!)

A modest fence on a ratioed list should allow the NWA pilots to enjoy the temporary bump in their attrition. Down the road, more DAL pilots retire than NWA pilots.

15 to 20 years down the road....