Douchebag Executives: The Big Three

In part 2 of the new feature on my blog, we’ll take a look at arguably the biggest douchebags on the planet; General Motors Chief Executive Officer Richard Wagoner; Chrysler Chief Executive Officer Robert Nardelli; and Ford Chief Executive Officer Alan Mulally.

By Chip Somodevilla -- Getty Images

In recent days these three douchebags have been in Washington D.C. begging for a piece of the bailout money to save their floundering companies from failure.  How could this happen?  How could a once iconic symbol that is the American automobile be driven in to a proverbial brick wall?  People will be quick to blame the current economic environment, but I would like to point out the arrogance and ignorance of those at the top.

While their competitors began to shift their focus to the hybrid and alternative-fuel vehicles, those in Detroit were content to keep pumping out gas-guzzling SUVs and lower quality vehicles than those of their foreign competitors.  As late as 2006, people were still pondering that the whole hybrid movement is a fad.  On top of that, just two short months ago, Ford was making justifications for not ramping up their hybrid production.  According to Ford, we really don’t want Hybrid vehicles; we just want more fuel efficient vehicles.  While this may be true to some extent, there is only so far that the internal combustion engine can go.

Do I need to remind anyone that GM's next greatest move was to introduce a hybrid Escalade?  An Escalade...seriously?

Continuing to wallow in their arrogance and obscene opulence, the big three douchebags had the balls to fly to Washington D.C. in their PRIVATE jets to beg for a piece of the bailout.

...the chief executives of the Big Three automakers opted to fly their company jets to the capital for their hearings this week before the Senate and House -- an ill-timed display of corporate excess for a trio of executives begging for an additional $25 billion from the public trough this week.

"There's a delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hands," Rep. Gary L. Ackerman (D-N.Y.) advised the pampered executives at a hearing yesterday. "It's almost like seeing a guy show up at the soup kitchen in high-hat and tuxedo. . . . I mean, couldn't you all have downgraded to first class or jet-pooled or something to get here?"

From the same article, when asked if they would reduce their salary to $1 a year, only Nardelli had offered to do so.  This is not unheard of in the corporate world.  Many executives live and die by their stock price and bonuses for performance.

So it was hard to feel sorry for the executives when Rep. Peter Roskam (R-Ill.), late in the hearing, reminded them again that "the symbolism of the private jet is difficult," and mischievously asked the witnesses whether, in another symbolic gesture, they would be willing to work for $1 a year, as Nardelli has offered to do.

"I don't have a position on that today," demurred Wagoner (2007 total compensation: $15.7 million).

"I understand the intent, but I think where we are is okay," said Mulally ($21.7 million).

"I'm asking about you," Roskam pressed.

"I think I'm okay where I am," Mulally said.

And don't even think about asking him to fly commercial.

No bailouts for the foolish.

Woot.

That is all.

Douchebag Executives: Winfried Bischoff

Welcome to a new feature here on my blog entitled Douchebag Executives. With each entry I'll profile an executive of a publically traded company who deserves the dubious honor of being labeled a douchebag.

Today, I would like to introduce you to the Chairman of the Board of Citigroup Inc (NYSE:C), Sir Winfried Bischoff. He's a douchebag AND a knight.

Last year Sir Bischoff earned a reported compensation of $6,130,390 USD. The key word there, is "reported". (This being the first in my feature of Douchebag Executives, let me say that I am a firm believer of pulling in whatever you can make, more power to you. I start to have a problem when this compensation rides on the backs of the shareholders and it's not being earned.) By any measure, he is a rich man. His executive resume is long and storied as well. Citigroup is not the only place Sir Bischoff has left his mark.

Sir Winfried Bischoff is Chairman of the Board of Citigroup Inc. He was Acting Chief Executive Officer; Chairman, Citigroup Europe of Citigroup Inc. He is a Member of the Citigroup Management and Operating Committees. Sir Win joined Citigroup Finance Division of J. Henry Schroder & Co. Limited, London, in 1966. In 1971, he was appointed Managing Director of Schroders Asia Limited, Hong Kong. He returned to London in January 1983 and was appointed Chairman of J. Henry Schroder & Co. in October 1983 and Group Chief Executive of Schroders plc in December 1984. Sir Win was appointed Chairman of Schroders plc in May 1995. Following the acquisition of Schroders’ investment banking business by Salomon Smith Barney, Inc., a subsidiary of Citigroup Inc., he assumed his present position in May 2000. He was a non-executive Director of Cable and Wireless plc from 1991-2003 and subsequently Deputy Chairman (1995-2003). His other non-executive directorships included IFIL - Finanziaria di Partecipazioni SpA, Italy (1999-2004) and Siemens Holdings Plc (2001-2003). Currently he is a Non-Executive Director of The McGraw-Hill Companies, New York, and of Land Securities plc since October 1999, and of Eli Lilly and Company, Indianapolis, since June 2000. After early education in Cologne and Dusseldorf, Germany, he moved to South Africa in 1955 and obtained a Bachelor of Commerce degree at the University of the Witwatersrand in Johannesburg (1959-61). From 1962 to 1963 he was attached to the International Department of The Chase Manhattan Bank in New York He was awarded a knighthood in the New Year Honours list in 2000, a Doctorate in Science, Honoris Causa, from City University in May 2000 and, in June 2001, was made a Johnson Honorary Fellow of St Anne’s College Oxford. He became Chairman of the UK Academy Foundation (2000-present) and was a Trustee of the Royal House Opera Covent Garden (2000-2003).

-Source

Maybe, he was an easy target in light of recent news.

The banking giant Citigroup, which a decade ago set out to rewrite the rules of American finance [emphasis added], announced Monday morning that it would cut 50,000 jobs in the coming quarters, largely by selling assets.

Even if you are not a Christian, this is the holiday season. It is a time of year celebrated by almost every developed nation on the planet. What a better way to say Merry Christmas, et al. than to hand someone a pink slip. Sir Bischoff is not alone in the blame, Vikram Pandit should probably catch some shrapnel for this as well, but I want to the keep the focus narrow at this time. Some might argue that this move was inevitable given the present financial climate, and the economy as whole. However, let us not forget Citigroup's dubious role in the whole subprime lending debacle.

In the largest consumer protection settlement in FTC history, Citigroup Inc. will pay $215 million to resolve Federal Trade Commission charges that Associates First Capital Corporation and Associates Corporation of North America (The Associates) engaged in systematic and widespread deceptive and abusive lending practices. Citigroup acquired The Associates in November 2000, and merged The Associates' consumer finance operations into its subsidiary, CitiFinancial Credit Company. The settlement is contingent on approval of the federal district court in Atlanta and approval of a related settlement in a class action lawsuit currently pending in California. If approved, the FTC and class action settlements together will provide $240 million in redress to consumers throughout the United States and its territories.

"The Commission will not tolerate the fleecing of subprime borrowers through deceptive lending practices such as the packing of unwanted credit insurance on consumers' loans," said Timothy J. Muris, Chairman of the FTC. "As a result of this settlement, as many as two million consumers will receive significant monetary relief in the form of cash refunds or reduced loan balances. I am pleased that Citigroup has agreed to remedy the grave injury caused by The Associates and that Citigroup has announced new measures at CitiFinancial aimed at preventing these kinds of problems. If fully implemented, these are positive steps in an industry that for too long has been plagued by deception and abuse. We will be looking to ensure that the law is obeyed."

Sir Bischoff stepped in to the role as Chairman on 12/7/2007. Under his tutelage, the share price has gone from $34.31 to, as of this writing, $9.17. Impressive, that under his watch the company has been devalued almost %375 and he still has a job. The quick and easy answer to saving money is always to eliminate headcount. In this case, it's 50,000 of Citigroup's hard working employees.

Maybe they should start at the top next time and find someone who knows how to make Citigroup some money. No bailouts for the foolish.

Are people going to start listening to Peter Schiff?

Don't Blame Captialism

Will the Big Three Automakers Survive?

Peter Schiff, president of Euro-Pacific Capital, explained why he is opposed to U.S. aid to faltering automakers: “if the government props the company up with more bailouts, it will just extend the inefficiencies and let them keep building cars no one wants to buy, at highly overpriced labor.”

Home prices see another record plunge

"The goal of all these plans is to give consumers more money to spend. However, excess consumer spending is part of the problem, not part of the solution" he said. "After a decade-long spending orgy, market forces are finally trying to restrict consumer spending and dampen credit. But the stimulus looks to provide a new source of funds after savings, income, and credit have been exhausted. Our imbalanced economy is in desperate need of retrenchment, but stimulus plans will effectively hold the firemen at bay while throwing gasoline on the flames."

Schiff explained that the housing boom's exotic mortgages, which let people buy homes with zero money down, have vanished. Now people must save to afford a home. But easy credit means people will buy more consumer goods and save less to put towards housing. As a result, he expects home prices to fall a lot more.

"They'll surrender all the gains they made in the past 10 years," he said, "and be even lower than they were 10 years ago."

Hopefully this is ignorance.

While it's not an excuse, I am just amazed that some people can be so out of touch.  I guess she thought Archie Bunker was protrayed as a tolerant individual.

Off-color Remark