Auto Execs Lining Up For Your Tax Dollars
When the chief executives of Chrysler, Ford and General Motors came before the House Financial Services Committee two weeks ago requesting a $25 billion bailout, I asked each of them a simple question; are you willing - in the spirit of Lee Iacocca - to work for a dollar?
Some may remember Iacocca for his legendary management of the ailing Chrysler Corporation in the late 1970s. After a successful run with Ford, he took on the challenge of rescuing the American flagship from bankruptcy and led by example, by working for a mere one dollar a year. Chrysler was structured to fail and suffering the financial consequences and needed real change.
In late 1979, Iacocca came before Congress requesting - just as the Big Three automakers today - a government bailout. He knew the request was serious, and demonstrated a willingness to forgo personal enrichment to save his company.
Thirty years later, American automakers find themselves again before Congress, hat in hand, tin cup out. Richard Wagoner, Alan Mulally and Robert Nardelli, from General Motors, Ford and Chrysler respectively, came to Capitol Hill to plead the case to obtain a chunk of the $25 billion - of which hard working taxpayers foot the bill.
Despite a lack of a clear business recovery plan, each answered questions from Members of Congress from across the nation. Earlier in the day ABC News reported that at least two of the three executives flew to Washington on private corporate jets at a cost of $20,000 each. This did not sit well with a committee being solicited for billions of taxpayer dollars.
A fellow colleague of mine told the execs "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?"
The symbolism of highly paid executives flying in private jets to Washington to request your tax dollars is unsettling to say the least. I asked the execs if they were willing to work for a dollar to show their commitment to turning their corporations around. This seemed like a reasonable request considering their solicitation.
Only one, Nardelli from Chrysler, was willing to put aside his multi-million dollar salary.
When I asked Wagoner of General Motors (2007 total compensation: $15.7 million) if he was willing to go down to the dollar, he said "I don't have a position on that today."
Posing the same question to Mulally of Ford ($21.7 million), he said "I understand the intent, but I think I'm okay where I am."
They may understand the intent, but their performance at our hearing confirmed the execs are clearly out of touch. Average Illinoisans work hard every day to earn, save and invest in their family's future. The willingness to tighten the belt in tough economic times should not stop before the top of the corporate ladder - it should start there.
Over the past few months Congress has authorized more than $1 trillion to prop up failing institutions. While many may disagree with the proper role of the federal government in intervening in the market place, we all can agree that we must be a stronger steward of the tax dollar.