Heyas all,
Actually, IMHO, the ruination of the airline industry is only a symptom of a larger problem in American business in general.
These days, business schools teach that there is no money to be had in ownership, but simply in the buying and selling of speculative assets.
The common catchphrase of management these days is "stockholder value". But the truth of the matter is that there are no real "signficant" stockholders other than the institutional investors, made big with the advent of mutual and private equity funds.
These funds do not make money with the slow accumulation of value, as might happen with a company interested in the growth of intrinsic value, but rather, these "stockholders" only make money with the stock "churns" in their funds. It is this overriding factor that causes most of corporate America to focus on short term principles that cause miniscule changes in stock price.
Go in, rape and pillage the company, cause the stock to churn a few quarter points, sell and move on. Management decisions have no consequenses in the long term, because there IS no long term. By the time anything comes back to haunt the company, the stockholders, and most of management are long, long gone.
As PJ O'Rourke once said of the colonization era of the 1500-1800's (paraphrased) , "There are two types of colonies: Settlement colonies and exploitation colonies. Settlement colonlies are where Quakers, Mormons and other similar types go to start a new place, free of the interference of the past, and to create long term institutions. Exploitation colonies are where the idiot sons of weathy barons go to extract as much short term weath from a place as is possible, and then split back to the Old Country to enjoy their booty. This is why some places are a reasonably nice places to live, like New England or Salt Lake, and other places are complete **CENSORED****CENSORED****CENSORED****CENSORED**holes, like Haiti."
This similar thinking is relected in today's coporate America. There are places where management/ownership is interested in creating value and long term viability, while others have fallen prey to simple exploitaion.
The worst thing about it is that business schools all teach, and public opinion reflects, that this is fine and dandy, no matter the consequenses.
Nu
Actually, IMHO, the ruination of the airline industry is only a symptom of a larger problem in American business in general.
These days, business schools teach that there is no money to be had in ownership, but simply in the buying and selling of speculative assets.
The common catchphrase of management these days is "stockholder value". But the truth of the matter is that there are no real "signficant" stockholders other than the institutional investors, made big with the advent of mutual and private equity funds.
These funds do not make money with the slow accumulation of value, as might happen with a company interested in the growth of intrinsic value, but rather, these "stockholders" only make money with the stock "churns" in their funds. It is this overriding factor that causes most of corporate America to focus on short term principles that cause miniscule changes in stock price.
Go in, rape and pillage the company, cause the stock to churn a few quarter points, sell and move on. Management decisions have no consequenses in the long term, because there IS no long term. By the time anything comes back to haunt the company, the stockholders, and most of management are long, long gone.
As PJ O'Rourke once said of the colonization era of the 1500-1800's (paraphrased) , "There are two types of colonies: Settlement colonies and exploitation colonies. Settlement colonlies are where Quakers, Mormons and other similar types go to start a new place, free of the interference of the past, and to create long term institutions. Exploitation colonies are where the idiot sons of weathy barons go to extract as much short term weath from a place as is possible, and then split back to the Old Country to enjoy their booty. This is why some places are a reasonably nice places to live, like New England or Salt Lake, and other places are complete **CENSORED****CENSORED****CENSORED****CENSORED**holes, like Haiti."
This similar thinking is relected in today's coporate America. There are places where management/ownership is interested in creating value and long term viability, while others have fallen prey to simple exploitaion.
The worst thing about it is that business schools all teach, and public opinion reflects, that this is fine and dandy, no matter the consequenses.
Nu
