It might be easier to fire the CEO, but the CEO will still get a multi-million dollar buyout of his contract to leave. CEO's are paid based on potential now instead of on performance, which is my issue. They also are given too many opportunities to cheat the books or cut corners in order to make profit appear higher and get an even larger sum of money. I'm not a fan of the large company CEO getting anything guaranteed.

mlb Wrote:It might be easier to fire the CEO, but the CEO will still get a multi-million dollar buyout of his contract to leave. CEO's are paid based on potential now instead of on performance, which is my issue. They also are given too many opportunities to cheat the books or cut corners in order to make profit appear higher and get an even larger sum of money. I'm not a fan of the large company CEO getting anything guaranteed.

Seems to be a little conflict here. You want CEO's paid on performance, which would indicate a sliding scale based on profit, but then you turn around and say they can cook the books to increase their compensation.. So how would your CEO ideally be compensated? Don't say outside auditors - remember Arthur Anderson?

Also, i think profit alone is not the best measure. One thing that a good CEO will do is take the company in new directions, perhaps branching out into related lines or acquiring new businesses. These may be very good moves for the long term benefit of the company, but they may also depress current earnings. Or a CEO may take over a business that lost 800 million last year, this year lost only 200 million. How do you figure his compensation?

Which is all beside the point. Some pepople just resent the big salaries some CEO's get. But their importamce relative to most workers is greatly magnified. It is kind of like saying, why does the QB on a pro team get so much more money than the assistant equipment manager? Especially when the QB may be running the team into the cellar of their division?

mlb Wrote:It might be easier to fire the CEO, but the CEO will still get a multi-million dollar buyout of his contract to leave. CEO's are paid based on potential now instead of on performance, which is my issue. They also are given too many opportunities to cheat the books or cut corners in order to make profit appear higher and get an even larger sum of money. I'm not a fan of the large company CEO getting anything guaranteed.

One positive fallout from the Enron and Coporate corruption scandal is now CEO's have to sign off on all financial statements. This goes for their underlings as well. My wife is responsible for a $65mil budget and has to sign off on the numbers every period, quarter and year end.
You can still cook the books but the chances of getting caught have increased and the penalties are much stiffer.
Every generation will have a handfull of CEO's hauled off to jail but by and large most play by the rules.

My plan, CEO's get a base salary ($500K - $1M, I do realize they should be paid well). They get performance bonuses based on long term sustained profitability, not quarterly or yearly profitability. Cooking the books for a quick bonus is too easy to do, and very tempting.

If nothing else, put all bonuses into some sort of escrow account, and after a specified period of time that money is released after all numbers have been completed, all previous quarters balance statements (for 2-3 years minimum) have been recompiled, etc. Then pay out their obscene bonuses.

Edit:

Owl, in terms of turning around a company, that is a great point. Maybe instead of saying "profitability", bonuses are based 1st on putting/keeping/moving a company to stable ground. Afterwards, bonuses are based on sustained profitability.

OptimisticOwl Wrote:

mlb Wrote:It might be easier to fire the CEO, but the CEO will still get a multi-million dollar buyout of his contract to leave. CEO's are paid based on potential now instead of on performance, which is my issue. They also are given too many opportunities to cheat the books or cut corners in order to make profit appear higher and get an even larger sum of money. I'm not a fan of the large company CEO getting anything guaranteed.

Seems to be a little conflict here. You want CEO's paid on performance, which would indicate a sliding scale based on profit, but then you turn around and say they can cook the books to increase their compensation.. So how would your CEO ideally be compensated? Don't say outside auditors - remember Arthur Anderson?

Also, i think profit alone is not the best measure. One thing that a good CEO will do is take the company in new directions, perhaps branching out into related lines or acquiring new businesses. These may be very good moves for the long term benefit of the company, but they may also depress current earnings. Or a CEO may take over a business that lost 800 million last year, this year lost only 200 million. How do you figure his compensation?

Which is all beside the point. Some pepople just resent the big salaries some CEO's get. But their importamce relative to most workers is greatly magnified. It is kind of like saying, why does the QB on a pro team get so much more money than the assistant equipment manager? Especially when the QB may be running the team into the cellar of their division?

I think that is a great analogy. My suggestion if it is a publicly traded company is to make a large portion of the CEOs salary based on options that aren't exercisable for like 5-10 years. The problem there is that everyone gets up in arms when everything works out and the CEO makes billions. No one ever writes about the losers. (Check out how the CEO of Delphi did after the spin off from GM. He got like 10 millions options for DPH at like $15. Looked great when the stock was at $22. Doesn't look so hot now that the stock is at $0.33)

OptimisticOwl Wrote:Some pepople just resent the big salaries some CEO's get. But their importamce relative to most workers is greatly magnified.

I do not have a problem with the big salaries the CEOs get. I have a problem when these CEOs get these high salaries and do a piss poor job. I think there is a problem when you have a a CEO making millions of dollars a year asking the "little" people to accept reductions in salary, benefits etc... while they are unwilling to make any cutbacks themselves.

Going back to the original topic of this thread.... Can anyone answer the trivia question of what year represented the highest amount of auto manufacturing jobs in U.S. history????

ShoreBuc Wrote:Going back to the original topic of this thread.... Can anyone answer the trivia question of what year represented the highest amount of auto manufacturing jobs in U.S. history????

I'll go with WWII period.

ShoreBuc Wrote:Going back to the original topic of this thread.... Can anyone answer the trivia question of what year represented the highest amount of auto manufacturing jobs in U.S. history????

2005?

I would guess sometime after 1975...

I45owl Wrote:

ShoreBuc Wrote:Going back to the original topic of this thread.... Can anyone answer the trivia question of what year represented the highest amount of auto manufacturing jobs in U.S. history????

2005?

I would guess sometime after 1975...

2005 Ding Ding Ding....You are the winner.
The reason for this is the foreign automanufacturers have opened up 28 new plants mostly in the south over the last 20yrs.