Delta Pilots End Era of Luxurious Pay

(Robert M. Gary) wrote
Perhaps I'm too conservative but I'll never understand that line of
thinking. Pilot's saleries are dictated by unions. There are 100
pilots wanting to work for every airline pilot employeed.

Yes, and these days they are probably just as good, too.

There was a time when the job of airline captain required a very high
level of skill and judgment. That was the era when airliners flew in
the weather, not above it. When autopilots were junk, and hand-flying
an approach was work. That and many other factors made it important
that if you wanted to get your passengers where they were going when
they needed to get there without losing too many, you needed a skilled
pilot in the cockpit.

The skills necessary were not very quantifiable, and could not be
effectively acquired in the training environment - they were covered
by that nebulous term called 'experience' for a reason. They're STILL
not quantifiable, nor can they really be acquired in the training
environment. Those skills, which have pretty much lost relevance in
the airline profession, are still very relevant for flying piston
singles and light twins if you want to get to where you want to be
where you need to be there without crashing. Some idiots even insist
they're not real - we've got another thread like that going now.

However, the era that requied airline pilots to have those skills is
long gone. These days, the level of regulation and (more importantly)
automation is such that the experience gained flying freight and
charter in piston singles and twins is not really all that relevant
anymore. Automation has devalued the job. Eventually, top salaries
for a senior captain are going to stabilize around the $100K mark, as
is the case for any senior non-managerial, non-self-employed
professional. I believe they are already there at JetBlue.

Executives have high saleries because they do a job few can do.

That is the theory. The problem, of course, is that they're usually
hired by people who can't do the job themselves and don't really know
what the job requies.

In that sense, hiring a CEO is a lot more like hiring a flight
instructor than it is like hiring an airline pilot. You're hiring him
for his expertise in an area where your expertise is limited (or
non-existent). Ideally, you want to evaluate him by the end-product -
how many and what percentage of his students achieved the goals you
want to achieve and how many failed - but that information is
generally very limited, and convoluted with other factors. In the
end, you will probably hire the one who gives the best sales pitch.

That's about how it is with CEO's. Getting that first CEO job is
mostly about convincing the board members (who don't know how to run
the company) that you know how to run the company. Once you've done
that, you have gained experience. That makes it easier to convince
the next board. If you have a good track record (which is a few
companies at best) you can command obscene salaries - because what's a
few million when it improves your chance of turning around a billion
dollar operation? Going with that logic, why not make the salary for
your basic CEO half a million (as was the case at Delta before he took
the pay cut?) As a minimum, you attract a better class of applicant.
I know lots of people who are willing to do the job for $100K a year,
but none who actually understand what the job entails. Just having
the necessary intellect to understand what the job entails and being
willing to put up with the unpleasantness of doing such a job is
enough to get a job that pays $100K a year - without being the 24/7
proposition that a CEO job is.

Not many people on this planet can be good CEOs.

This is true - and not many are. In fact most CEO's are lousy CEO's.
See above - there really is no process for consistently picking good
ones.

CEOs are highly paid for
the same reason NBA Basketball stars are, not many people can do those
jobs.

But most NBA players are not stars, and are still very well paid.
It's that halo effect - why not pay them a lot, the cost is small
compared to the overall cost, and you will get a better class of
applicant.

CEOs can be let go if the board thinks their saleries are too
high, pilots cannot. If another CEO offers to work for Delta for less,
the board can fire the current CEO and hire the less expensive guy at
any time.

That's objectively not true. CEO's have contracts.

Michael

"Peter MacPherson" wrote in message news:...
CEOs can be let go if the board thinks their saleries are too
high, pilots cannot.

What about being let go for incompetence? You don't see this
happen very often, though you should. How many companies
are run into the ground by incompetent CEO's who then walk
away at the end with a boat load of cash.

If another CEO offers to work for Delta for less,
the board can fire the current CEO and hire the less expensive guy at
any time.

Huh? So these CEO's are just working paycheck to paycheck? ; )
I think I remember something about a contract.



"Robert M. Gary" wrote in message
om...
"Peter MacPherson" wrote in message
news:464ld.24424$V41.22997@attbi_s52...
Did Delta also end an era of luxurious "management pay" by 32.5 percent?
I tend to think not.....

Perhaps I'm too conservative but I'll never understand that line of
thinking. Pilot's saleries are dictated by unions. There are 100
pilots wanting to work for every airline pilot employeed. Saleries
would normally be quite low with so many wanting those jobs, but the
union makes them high.
Executives have high saleries because they do a job few can do. Not
many people on this planet can be good CEOs. CEOs are highly paid for
the same reason NBA Basketball stars are, not many people can do those
jobs. CEOs can be let go if the board thinks their saleries are too
high, pilots cannot. If another CEO offers to work for Delta for less,
the board can fire the current CEO and hire the less expensive guy at
any time. The board cannot just hire their friends because they can
get fired. The institutional investors and fund managers make their
money 100% on the company's bottom line. They will not stand for
spending their money on a CEO being paid more than he's worth on the
market. The board are elected by these fund managers and institutional
invesytors. If the company spends more money than they need to, the
stock will do less well, the fund managers will lower their efficiency
rating, and investors (mostly retirement accounts) will choose other
funds to invest in. Everyone has someone to answer to. A good CEO can
make or break a company, its worth paying full market rate for a good
CEO.
Free market economics works amazingly well if we just let it be free.

-Robert, FAA Certified Flight Instructor, Commercial Pilot and MBA

"Nik" wrote:

You might well ask whether or not it is really reasonable for the
airlines to pay for the politicians attempts to make us feel good.

Well said.

Unfortunately, most people insist on feeling good without regard for the
rationality of policies intended to soothe their anxieties. Every time
I have to go through the airport security charade, I get a mental image
of bin Laden laughing.
--
Dan

"There ought to be limits to freedom."
- George W. Bush

"Dan Luke" wrote in message
...

"Nik" wrote:

You might well ask whether or not it is really reasonable for the
airlines to pay for the politicians attempts to make us feel good.

Well said.

Unfortunately, most people insist on feeling good without regard for the
rationality of policies intended to soothe their anxieties. Every time
I have to go through the airport security charade, I get a mental image
of bin Laden laughing.

I suspect he is selling the US security equipment.

--
Dan

"There ought to be limits to freedom."
- George W. Bush

"Dan Luke" wrote in message
...
"There ought to be limits to freedom."
- George W. Bush

If the personal freedoms guaranteed by the Constitution inhibit the
government's ability to govern the people, we should look to limit those
guarantees." -- Bill Clinton, August 12, 1993, MTV Interview

"Matt Barrow" wrote:
"There ought to be limits to freedom."
- George W. Bush

If the personal freedoms guaranteed by the Constitution inhibit the
government's ability to govern the people, we should look to limit
those
guarantees." -- Bill Clinton, August 12, 1993, MTV Interview


They all think they're smarter than we are, and know what's "best" for
us. Unfortunately, most people are content to let "them" handle it,
whatever it is.
--
Dan
C172RG at BFM

"John Mazor" wrote in message
...
"Chris" wrote in message
...

"Jay Honeck" wrote in message
news:OFnld.92292$R05.12286@attbi_s53...
It is amazing these airlines have soaked up billions of Dollars in
Federal subsidies and still cannot get by.

Which was, of course, the reason many of us argued against bailing
them
out in the first place.

If the business climate is such that an airline cannot make money
without
taxpayer support, let it die. The surviving airlines will pounce on
the
opportunity, becoming more efficient in the long run.

Personally, if we were going to waste money on such a grand scale, I'd
rather have seen the Feds subsidize airline service to the
small-to-medium
sized airports in the heartland. This would have helped General
Aviation
more than anything else, in the long run.

all this crap about security adding to their costs is total ********.
Most
if not all of this is passed on to the passenger anyway.

All costs in any business are passed on to the consumer, in the long run.

And it raises the price of a ticket, making air travel less competitive
with
other modes.

There's also a bias against network carriers. If you're a low-cost
carrier,
most of your service is point to point. Network carriers run a lot of
traffic through connecting flights at hubs, so some of the fees are
applied
twice to the ticket price, once for each segment.

A very telling quite from a United employee a number of months ago "Of
course Southwest is making money, they fly people to where they want to go."
You would think that would have shown up in a United suggestion box at some
point in time.

"Dave Stadt" wrote:
A very telling quite from a United employee a number of months ago "Of
course Southwest is making money, they fly people to where they want
to go."
You would think that would have shown up in a United suggestion box at
some
point in time.


Hee-hee! Beautiful.

Any veteran of servitude in a huge corporation will nod in recognition
at this. It's enough to make you scream when you're down in the forest
trying to make lumber and you realize upper mgmt. has forgotten what
trees are.
--
Dan
C172RG at BFM

"Dave Stadt" wrote in message A very telling quite from a United employee
a number of months ago "Of
course Southwest is making money, they fly people to where they want to
go."

I disagree. While somewhat better than a big hub, Southwest's system of
little hubs can mean as many as 3 connections to get to where I want to go.

Ever wonder why a connecting flight has the same flight number even when the
plane, crew, and gate change at the connection? To pay less tax.

D.

Jim Rosinski wrote:

"G.R. Patterson III" wrote

Chrysler didn't get any bailout from the government. What they did was get the
government to cosign their loans. Since they survived, it didn't cost the
taxpayers a dime. Not the same as the airline situation at all.

Forcing taxpayers to cosign on a loan counts as a bailout in my book,
whether they (we) end up having to pay or not.

Well, it doesn't in mine.

George Patterson
If a man gets into a fight 3,000 miles away from home, he *had* to have
been looking for it.