Delta Pilots End Era of Luxurious Pay

"C Kingsbury" wrote in message news

"Robert M. Gary" wrote in message
om...

A good CEO can make or break a company


And there's been no lack of "breaking" going on in the airline biz lately.
It's been over 20 years since deregulation, they can't keep using that
excuse. The airlines are where they are today because of management building
companies with high cost structures. Many of those managers are still there.


Free market economics works amazingly well if we just let it be free.


I think you're a little naive about the way business really works at the
level of a company like Delta. CEO pay has been increasing dramatically
across the board not just for companies that have done well, but at those
that haven't. So much so that even the institutions are starting to show
signs of concern. These same wonderful institutional investors who, by the
way, were making billions flipping IPOs and market-timing your mutual funds.
They're all a bunch of crooks and it pains me to say it because I think the
only thing worse than capitalism is everything else. But we've failed lately
in policing the fraud and as a result it's spread far and wide. Somebody
please explain to me why Martha Stewart is in jail and Ken Lay isn't.



http://www.lcurve.org/images/LCurveFlier2003.pdf

"aluckyguess" writes:

I'm an engineer for the state. I see bozos here but I also see
hardworking and highly skilled people who are grossly underpaid. I
have a guy with 4 degrees from UC Berkeley and MIT working for me now.
He could get 50% more working for other govt. agencies and maybe even
more working for private.

Degree's dont meen anthing on what somebodys worth. If he cant get twice the
pay he is stubid for not doing it. I believe he is afraid to leave. He lacks
confidence in himself, that or he likes the his cushy govermnet job.

You are right that degrees are not a good indication of somebody's
worth, especially degrees from 2nd-tier universities, which tend to
hand them out liberally. It would be cruel of me to also say that I
hope spelling and grammar aren't indicators either, so I won't. But
you are very wrong about this individual. He is the most talented
person I've ever hired, very productive, and very confident. He stays
on because no other place will provide the opportunity to do what he
wants (develop an advanced numerical model).

The point is that pay is only one factor of several that make a job
desirable. In the case of CEOs or other highly paid jobs
(e.g. sports), I think beyond a certain point the money offered is not
wanted for what it can buy, but simply as an indicator of what the
boss thinks of you compared to others.

(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

"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

"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.

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.

devil wrote:

In other words, cheaper than the rates the market would loan them at, when
factoring in the risk. Which BTW is the normal practice.

No.

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

"John Mazor" wrote in message
...
[someone said]
It is amazing what folks can do with the rules once the feds lock them
in. We have a new ritzy exurb going in where they noticed a federal
program to encourage broadband in farm areas. They used the subsidy to
set up their cable system for their houses. Well, it used to be farm
land and the feds were sloppy.

Here the county is thinking of subsidizing an expansion of fiber cable,
including what would be service to $400k houses.

But in the DC area, $400K is low-cost housing or townhouses. They hardly
build anything below $600K within 25 miles of DC. They want $800K for new
cardboard-wall townhouses not too far from me.

Mark my words, the conversion of telephone service to fiber will
reduce the ultimate reliability of phone service. There is still "copper"
into the home, and the conversion from fiber to copper takes place in nearby
electronics powered from the electric utility. When the lights go out, the
phone fiber-to-copper electronics run on battery UNTIL THE BATTERY RUNS
DOWN, a matter of a couple of days. So your phone will fail during an
extended electrical outage. Neat. Many cell-phone sites do not have a
backup generator, so they too fail when their battery runs down.

"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

"R J Carpenter" writes:

When the lights go out, the
phone fiber-to-copper electronics run on battery UNTIL THE BATTERY RUNS
DOWN, a matter of a couple of days. So your phone will fail during an
extended electrical outage.

Your conventional all-copper-wire-to-the-Central-Office phone will
fail exactly in the same way. What do you think powers them during an
"extended electrical outage"??