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Thread: CEOs lay off thousands, rake in millions

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by EnigmaO01 View Post
    The problem is you're not listening. If the company's not making money due to the CEO's incompetence, how can that be making the shareholders money?
    I think everyone who's making that same argument needs to really listen to what people such as you and I are saying here. It's not that we don't think CEOs should not be paid. In the end, they are employees, too. They were hired to do a job - lead their company to profitability. But it is clear using the two examples I've provided - HP and Johnson & Johnson - that did not happen. As such, IMHO, neither of these CEOs deserve the severage packages they walked away with because not only did their companies lose money under their leadership, but they cost employees their jobs while also walking away with millions for their mismanagement.

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by Objective Voice View Post
    Since folks are arguing that business exist to make money, I went back and looked at the primary entity mentioned in the OP, Hewlett Packard (HPQ), and reviewed their stock over the last year. The company's stock has a 1-year change of -9.25% since Aug 2008. They reached a high in late-March of nearly 55 points (54.75) for the 52-week period, but since then have dropped to just over 40 points (40.34) when the markets closed on Friday (9/03/10).

    A quote from the article in the OP reads:



    Atleast where HP is concerned, the arguments for their CEO walking away with millions for underperforming does not hold water. He didn't make money for his company's shareholders. He lost them money, yet still managed to walk away with $24.2 million dollars!

    Another company, Johnson & Johnson (JNJ):



    Their 52-week high was 66.20 points; 1-year ago their stock was at 61 points. They closed 9/03/10 at 58.93. One-year change, -1.27. Not nearly as bad as HP, but still they company lost money for their shareholders.

    How does underperforming and mismanaging their companies justify their multi-million dollar payouts?

    And the argument someone made that the employees don't matter...!?! Of course they matter! These are the exact same people who Republicans are claiming the Bush tax-cuts will benefit the most because they will create jobs. So, I'll come right back to my same question:

    "If tax cuts were so beneficial to job growth, why the hell are these companies losing jobs?"

    Why is it that between these two well known American companies, they've posted a combined loss of
    -10.52 points on the NASDAQ, cut 9,400 jobs yet their CEOs walked away with just under $50M in severage pay?
    Not sure if people really want to look at the facts at HPQ. But if so, they will see that in fact from the time Hurd came on until the time he was let go the stock outperformed the market. Yoy may also want to remember that the date you use 9/3 is after he left. Part of the reason he the stock is down is because he left! Also since he is gone, HPQ got into a bidding war and probably overpaid for a rather small company. What they overpaid is probably more than the $24 million.

    While I think that CEOs as a group are overpaid for their performance it seems ironic that people here talk about a rare case when most people thought that Hurd was a very effective CEO!?

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by MrVicchio View Post
    What if the CEO hired turned a 60 billion dollar loss into a 20 billion dollar loss. That's 40 billion in savings. I'd say that's an achievement for which compensation is due.
    Then the company's BoD & shareholders need to evaluate how that +$40 difference was made. Did it come at the expense of the employees (layoffs)? Or did it come because the company cut alot of excess waste (sold corporate jets, closed under utilized office space and consolidated same into more useful space or under one functional building), did upper management take pay-cuts or did the employees decide to do it to save the company the love working for?

    You have to evaluate why that +$40M came to be before you can answer that question. I would say that if such came at the expense of their employees, then that CEO didn't look deep enough at other ways that same $40M could have be saved elsewhere especially in a down economy. Just as you and others have argued that the government needs to make budget cuts, same can be said for thise private business. But again, I say you have to know what the situation is and why the decisions where made to save that $40M before anyone can rightfully answer that question. I refuse to answer such blindly.
    Last edited by Objective Voice; 09-05-10 at 01:07 PM.

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by Objective Voice View Post
    Since folks are arguing that business exist to make money, I went back and looked at the primary entity mentioned in the OP, Hewlett Packard (HPQ), and reviewed their stock over the last year. The company's stock has a 1-year change of -9.25% since Aug 2008. They reached a high in late-March of nearly 55 points (54.75) for the 52-week period, but since then have dropped to just over 40 points (40.34) when the markets closed on Friday (9/03/10).

    A quote from the article in the OP reads:



    Atleast where HP is concerned, the arguments for their CEO walking away with millions for underperforming does not hold water. He didn't make money for his company's shareholders. He lost them money, yet still managed to walk away with $24.2 million dollars!

    Another company, Johnson & Johnson (JNJ):

    Why do you keep claiming that? I linked you to HP's profitability earlier in the thread.
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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by Objective Voice View Post
    Then they company's BoD & shareholders need to evaluate how that +$40 difference was made. Did it come at the expense of the employees (layoffs)? Or did it come because the company cut alot of excess waste (sold corporate jets, closed under utilized office space and consolidated same into more useful space or under one functional building), did upper management take pay-cuts or did the employees decide to do it to save the company the love working for?

    You have to evaluate why that +$40M came to be before you can answer that question. I would say that if such came at the expense of their employees, then that CEO didn't look deep enough at other ways that same $40M could have be saved elsewhere especially in a down economy. Just as you and others have argued that the government needs to make budget cuts, same can be said for thise private business. But again, I say you have to know what the situation is and why the decisions where made to save that $40M before anyone can rightfully answer that question. I refuse to answer such blindly.
    You seem to think that a company's health and profitability is measured by the number of people it employs. Sorry, but that isn't so. Jobs are incidental to business, not the point of it. Yet, you seem to think that a company exists to create them.
    “Offing those rich pigs with their own forks and knives, and then eating a meal in the same room, far out! The Weathermen dig Charles Manson.”-- Bernadine Dohrn

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by washunut View Post
    Not sure if people really want to look at the facts at HPQ. But if so, they will see that in fact from the time Hurd came on until the time he was let go the stock outperformed the market. Yoy may also want to remember that the date you use 9/3 is after he left. Part of the reason he the stock is down is because he left! Also since he is gone, HPQ got into a bidding war and probably overpaid for a rather small company. What they overpaid is probably more than the $24 million.
    Thanks for providing this insight. My argument, of course, is based on the information provided. Your insight kinda changes my perspective alittle...if true....not alot, but some.

    While I think that CEOs as a group are overpaid for their performance it seems ironic that people here talk about a rare case when most people thought that Hurd was a very effective CEO!?
    Again, I'm willing to conceed that he performed well over the life of his tenure and just left when the company was on a downturn. But here again if he did everything he could to make his company profitable but in the end his best wasn't good enough, I still don't think such a CEO deserves to walk away with millions while also laying off thousands of employees. Something about that just seems wrong to me.

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by Harshaw View Post
    Why do you keep claiming that? I linked you to HP's profitability earlier in the thread.
    I must've missed that...where is it? Post number please...

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by Objective Voice View Post
    I must've missed that...where is it? Post number please...
    Here's the story:

    News Headlines

    Here's the post:

    http://www.debatepolitics.com/breaki...post1058963595
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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by TurtleDude View Post
    do you demand a link proving that the sun rises from the east as well? DO you play such evasive games because you don't like the facts? FOR YEARS the fans of the death tax justify it saying only 1% of estates pay that tax and there have been dozens of links to the income tax burdens. GIYLF
    Now you're insulting my intelligence. Excuses are for losers. Are you going to post al link backing up your claims or not?

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    Re: CEOs lay off thousands, rake in millions

    Quote Originally Posted by Harshaw View Post
    You seem to think that a company's health and profitability is measured by the number of people it employs. Sorry, but that isn't so. Jobs are incidental to business, not the point of it. Yet, you seem to think that a company exists to create them.
    Did I say that? No, I did not. There's alot that go into a company's profitability. Part of that includes payroll. But to think of the employees as inconsequential...that's just wrong.

    I'd like to think that employees are the last things companies large and small will cut when things go bad. If so, and the CEO has done everything he/she could to turn things around, then you gotta do whatcha gotta do. But I still don't think that CEO should be rewarded for mismanagement. So, the question is were companies like HP and J&J mismanaged under their former CEOs or did they really do everything they could to make their companies profitable? Based on the numbers alone, they did not. But as I said earlier, we/I don't know the details.

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