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IP: Call it "in-your-face-capitalism."
From: Dave Farber <farber () central cis upenn edu>
Date: Mon, 19 Feb 1996 13:08:12 -0500
The Hit Men (Newsweek, Feb 26, 96) Call it "in-your-face-capitalism." You lose your job, your ex- employer's stock price rises, the CEO gets a fat raise. Today, the more people a company fires, the more Wall Street loves it, the higher its stock price goes. Cheer up, you're serving the greater good by being blown away by what economist Joseph Schumpeter christened "the gale of creative destruction." The world is changing and no matter how big and rich a company is, it has to adapt or die. But Wall Street and Big Business have made a bad problem worse by being greedheads. Lots of CEOs have messed up big time. They let payrolls get bloated. Then to recoup, the offer up employees as sacrifices to Mammon, god of Wall Street, hoping to get their stock price back up. When the price rises, it's like Wall Street spitting on the victim's bodies. Corporate heads, salaries and layoffs: Robert Allen, AT&T. Salary: $3,362,000, 40,000 layoffs. Louis Gerstner, IBM, $2,625,000, 60,000. Robert Palmer, Digital Equipment, $900,016, 20,000. Walter Shipley, Chemical/Chase, $2,496,154, 12,000. Charles Lee, GTE. $2,004,115, 17,000. Ronald Allen, Delta Air Lines, $475,000, 15,000. John McDonnell, McDonnell Douglas, $577,791, 17,000. Robert Stempel, General Motors, $1,000,000, 74,000. Edward Brennan, Sears, Roebuck, $3,075,000, 50,000. Michael Miles, Philip Morris, $1,000,000, 14,000. Frank Shrontz, Boeing, $1,420,935, 28,000. William Ferguson, CEO Nynex, $800,000, 16,800. Albert Dunlap, Scott Paper. $100,000,000 in salary, stock profits and other perks, 11,000.
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- IP: Call it "in-your-face-capitalism." Dave Farber (Feb 19)