Labor is the only real cost element a company can control in order to reduce it;s cost and make itself more "profitable" looking which I'm sure is one of the CEO's performance based metrics in his bonus. Remember "Neutron" Jack Welch of GE? One of the most revered and supposedly "brilliant" CEOs in history. He earned the nickname "Neutron" because he simply made the people disappear. In addition, there's a reasin why they pay the executive levels in stock options. Give the guy enough stock options and he'll kill himself to keep the stock price going up, as that's the way he makes a lot of money. Unfortunately, business isn't about jobs anymore. It's about keeping yourself attractive to the Wall Street analysts so they continue to give your company "buy" recommendations.

 

the biggest and best trick the rich ever played on the poor is to get the poor to argue in favour of the rich, because, in doing so they managed to rip off the poor and, in the name of God and Country, defend their rights to do it.

To set up a system that pays CEO's hundreds of times what the guy on the shop floor makes.
To set up a system that taxes them so highly and exempts the rich from paying tax at a level proportionate to earnings.
To set up a system wherein the poor argue vehemently for their own f*cking and call anyone who wishes to defend them against the ones administering the f*cking, socialists, or nutjobs, or (and this is the one that makes my blood boil) un-american.

And the Supreme Court of the USA just allowed a ruling that says that coporations can give as much $$ as they want to political campaigns! You think you have a voice when corporations can basically elect who they wish too? Hmmm...

"The reason the rich tell the poor to pull themselves up by their own bootstraps is because that's the best way to get the poor to bend over!"

Fact is that the gap between rich and poor is growing in this country. And, statistically speaking, the rich started out rich and they stay rich. The poor started out poor and will ever stay that way.

Now, I know everyone here has a rags to riches story, which is why I said "Statistically."

Sociology has proven that if your dad was a carpenter, you're probably going to be a carpenter. If your dad was a CEO, you are probably going to be in business.

Sure, everyone knows a rags to riches story, but this is how it is. Stats tell the tale.

Honestly, the responses I'm sure to get to this msg. will do nothing more than intensify my earning to get on my bike and ride to whatever place I can that ensures the smallest population numbers with the highest incidence of sunny weather and heat.

So, all you guys earning less than six-figures that are arguing that this guy is worth what he's being paid... well is the inverse true? Are you worth what you're getting paid? Happy with it?

I found one study interesting. I can't remember who conducted the study, but the interviewed folks from all strata of society and asked them how much more money they'd have to make than they are making now?

Almost every one of them, from a CEO down to a dishwasher said, "if i could just double what I'm making, things would be perfect."

I'd argue that a company that is laying off workers and losing money, canNOT afford to give massive bonuses to execs. So, in the current climate, they're going with a model that doesn't work. They may get lucky and will come out of this unscathed... HD is one of the strongest brands in the world along with Krispy Kreme and McDonald's so they'll be fine... But I think that my arguments are borne out by the fact that HD is apparently laying off workers and endangering families livelihoods while paying exorbitant sums of $$ to upper level execs and I think it's sh*tty and obscene and I think it's weird to see folks arguing for it.

Anyway... I'm tired. Good night!

 

David, Well written. Good article. At work there is always some discussion at break time about something. We often talk about how the gap between the rich and poor is increasing (and the poor including what used to be called "middle class"). I don't know if it's happening in every area of the country but in NJ One thing we've noticed is there are no more developements of small "Starter" houses being built. They used to built developements of "Levittown" homes. Small ranch houses on 1/2 acre lots. Now it's either $750K houses on 6 acrea lots being built or crammed in townhouses. nothing in between. The American dream of buying and owning your own house and raising a family is out of reach for 90% of young people. At least in this state anyway.

I couldn't believe DisneyWorld. They now have a special theme park "pass" for the parents who want (or can afford) to spend the extra money. It allows your child to go to the front of the lines of other children waiting for rides. unbelievable.

But, back to Harley, It will be interesting to see what decisions are made with the company in the next few years. Granted Buell wasn't the most popular sportbike among the new generation of riders but Harley better do something to attract those new riders. The "baby boomer" generation is getting older. I don't think selling Ultra Classic's in India is their answer to success.

 

Then what would you do?

Personally, I like a system that promises me the opportunity to rise as far as my abilities will allow. Notice, I said "promises me the opportunity": we shouldn't expect anything without working for it.

I also like my executive leadership to be the absolute best and brightest. I want them to be of the caliber that will be able to lead our organization through this fiscal climate while strengthening our mission. I have no problem with creating incentive bonuses for them (like stock options) if it makes them work even harder.

Wandell is doing alright, IMO. He has eliminated two major brands and focused on the core brand. He is creating all kinds of incentive programs to work with the dealers and move inventory (like the rival trade, and now all these programs to buy new '09s). He is looking at reducing production costs long-term--and that is the hardest. Making production more efficient will mean that some jobs will be lost in the short-term in order to preserve most jobs over the long-term (you need to keep the company around to make sure people can work there). That's a tough one, and the last resort (anyone who thinks that execs live and love to do this should sit in on a collective bargaining negotiation).

Times are tough. If HD believes this is the guy who can lead the Motor Company through them with the least blood lost, then more power to him.

(Lots of uncited "assertions"......)

So now the issue is parenting? If a parent teaches their kid all s/he knows and has learned from life and career, and helps the kid apply that knowledge...that's wrong?

If you're implying that CEOs will simply breed more CEOs or that carpenters breed more carpenters, that is less the case than it used to be. For one, the choice and opportunity available to young people is unprecedented, and more and more young people are choosing to enter careers that didn't exist when their parents were their age. And, the level of accountability and scrutiny in business is too high for pedigree to buoy anybody anymore. Jamie Dimon is a good example of the new type of executive.

Any day is a good day for a ride. But to drop a lot of unsupported "statistics" and then say you want to run away from a debate you help advance....dood, c'mon....

While I'd like to earn more (who wouldn't), I know my salary is within 10% of the national norm for what I do, and 18% higher than the Montana norm. I also have a clear path of advancement, if I choose to do the above-and-beyond sort of work to move up and earn more, competition notwithstanding. It's up to me to accept the sacrifices required if I want to advance (or change careers). My choice.

But that is America. Freedom and meritocracy.

 

It all depends on whether they are stock options or grants. A stock grant is like giving you the stock, and it's worth whatever the stock is actually worth when you sell it. Hopefully it's stock options, which would be worthless unless the stock goes up in value compared to the stock price when the stock option is granted. That would reward a CEO based on the performance of the company/stock...

 

This has been dealt with already in this thread. Some people choose to apply themselves throughout their lives to maximize the value of their employment while others choose not to. Everybody has the same opportunity.
That is just not true. For starters, the top 1% of taxpayers earn about 20% of the total income and pay about 40% of taxes.
You have the greatest country in the world that became that because its people had the opportunity to excel if they wanted to. By exceling, they created a lot of wealth for themselves and created a lot wealth for even those at the lowest income level. People did this, not the government. When you start using the government to confiscate property from one person who has earned it to give to another who has not, you are weakening the mechanizm that made the country great and would allow it to continue on that path. So, yes, socialism seems a bit unAmerican to me.

Probably in todays world, "the rich" need employees who have more developed skill sets, they need a more affluent population, they want people to become rich because they know that the more "rich" people there are, the better off the country will be.

Of course the rich generally beget rich and poor generally beget poor. Have you ever seen how the wealthy raise their kids? They are incredibly focused on their education and developing the kids leadership skills. A couple of immigrant classes do this also - recognize the opportunity and get real focused. Look at some of the poor families - no focus on education, no goals for the kids and many times, multi-generational reliance on government assistance. There are many exceptions on both ends of the spectrum.

Yah, I used to earn a 5 fig income, hell, I used to earn a 4 fig income. A number of years ago I decided to make some sacrifices and take the opportunity to do better. I'm not in the 7 or 8 figure bracket but I am very satisfied with the results.

The execs are paid what their contract between them and the board dictated. When a company's business is shrinking, they have to reduce their production and the biggest part of production costs, labor. I don't know if you noticed but the economy isn't real buoyant right now so, no matter how much a company wishes it could sell more product, it just isn't going to happen. Tough strategies have to be developed and tough decisions made. The purpose of any company's existence is not to provide/protect jobs but to be successful - the offshoot of that success will be employment.

 

Wandell, 60, replaced James L. Ziemer, who retired last year after 40 years with Harley-Davidson and four years as its CEO. Before taking over Harley, Wandell was chief operating officer of the car battery and building ventilation systems maker Johnson Controls Inc.

Does this guy even KNOW what a motorcycle is?

 

Faber,

My wife has her Masters in Sociology. Her degree and my observations show me every day that this is not a Meritocracy. As I said, for some, it is. But there are too many factors proving that wealth begets wealth and poverty begets poverty for me to believe anything else.

I quit my full time job this year to return to school. I am learning real fast that for kids to go to college these days, they have to agree to leave college with debt in the form of student loans, just to better themselves and their chances for a better life.

I want to be led by the best and brightest also, and that is the core of my argument. Not only will we never know who the best and brightest are because our educational system is incredibly faulty and prohibitively expensive, (we're still paying off my wife's student loans and she graduated 12 years ago) but what is passing for the "best and brightest" is making the same tired assumptions that, to do business, one must sacrifice the little guy to the maw of the market forces that "none of us can control."

I'm so tired of the "business first" model. There are so many organisations out there that do incredibly well by working a concern for their employees into the business model!

Besides, how do we expect to stimulate our economy (you know, the economy that was ruined by the very same execs that are now getting the bonuses that we're discussing right now?) if we keep firing our labour force? What's that guy going to do that used to bolt transmissions into Sportsters now? Work at McDonald's? Dig ditches? Move to Korea when HD starts outsourcing labour because it's cheaper to build transmissions overseas?

How is an economy stimulated when the poor (the majority of the country) is too broke to buy anything?

BUSINESS FIRST isn't working, folks.

And they've sold us this bill of goods because...gasp! it's profitable for them. Go figure.

"You have the greatest country in the world that became that because its people had the opportunity to excel if they wanted to. By exceling, they created a lot of wealth for themselves and created a lot wealth for even those at the lowest income level. People did this, not the government. When you start using the government to confiscate property from one person who has earned it to give to another who has not, you are weakening the mechanizm that made the country great and would allow it to continue on that path. So, yes, socialism seems a bit unAmerican to me."

Well, I have a lot of problems with the above statement. Starting with "The greatest country on Earth..." I mean, really? Why even bother taking it there? We're an amazing country. We do a lot of wonderful things in the world and we save a lot of lives and we enjoy a lot of surface freedom, yes. BUT, those wacky Spanish folks aren't exactly labouring under the yoke of slavery, you know? Greeks and Russians and Englishmen, Italians and Moroccans... they're all enjoying freedom too.

And as far as I can see, the wealthy in this country aren't exactly creating a wealthy underclass just because they're earning a lot of money. If you're trying to tell me that tired old chestnut of trickle down economics is a great idea... well, that's what led us here, so... I'm pretty sure that hard-working poor folks who are working 50 and 60 hour weeks and still can't meet the costs of feeding the family and keeping the house warm might be a little tired of being told that they can eat the scraps from a rich man's plate.

And I'm also worn out with people jumping to the conclusion that, just because I'm trying to advocate a different kind of thinking that I am saying the government should be taking from those that have earned it to give it to those who have not. I am not advocating that. What I AM advocating is trying to find a way to engineer a system so that those who work honestly and well, can reap the rewards of their labour.

I see people working their asses off every day who can barely afford to keep the lights on, much less put a kid through college. And when I see some newly successful person with a little money crapping on folks that are where they were a single generation agi, it makes my blood boil.

Meritocracy? Please. How is a school in a poor neighbourhood that doesn't get the same funding as a school in a wealthier neighbourhood going to compete? It's NOT.

And people that claim that America is a meritocracy just ain't looking.

I Love My Country. My country has done well by me and my family. My family has fought for this country and suffered for it. (in the interest of full disclosure, I was too stupid to serve when I was younger and that's why, at the age of 44, I am trying to become a schoolteacher, so I can serve another way).

BUT, I love my country the way an adult loves someone. Aware of their faults and blessings. I love this country, faults and all and strive every day to live a life that might set an example for younger people. Including questioning our system, trying to be aware of where it's broken and celebrating where it isn't broken.

and Faber, I'm not the only one making uncited assertions...

"Obscenity? Try telling that to a white boy digging ditches til they put him in his grave. Ain't got to be a black boy to be living like a slave."

WOW... I'm tempted to apologise for the sheer length of this sucker! Anyway, I do apologise for the angry tone.

I actually think that the back and forth of discussions like this are where What America Means are worked out and why we're the amazingly wonderful country that we are.

So, thanks for the responses and thanks for being polite and remember... be nice to those around you!

 

And I have a PhD.

I can cite bibliography with the best of them. I am a quant guy but do qual work, too (prefer mixed-method, actually). I'm an ace at instrument development, a recognized expert in designing reliability tests, and eat validity claims for breakfast. But I didn't get into this thread to start an academic pissing war. (How was that? I really did try to turn it up a notch It's OK, my grad students laugh at me when I get like that, too)

So far many data on the Millennials show that the pattern you illustrate above is breaking down at a faster rate than for any previous generation.

Congratulations on your decision! There is no such thing as a free lunch. If you want the opportunity of higher ed., you have to be willing to sacrifice a little for it. I don't see a problem with that. (And if they don't want loans, there are other solutions.)

I assume you're arguing against someone else here: this is not what I was getting into.


Read Jonathan Kozol. Our schools are the shittiest in the free world. No argument there. And we, as a nation, outspend the highest performing school systems in the world by a factor of 13.

Still disagree. I'd say you're not looking. There is always a way up and out. Always. Sometimes it's hard work. Sometimes it's *real* hard work. But there is always a way.


I served. I am an immigrant who came here and refused any family help to make my way. I served honorably in the Army infantry, got my GI Bill, went to college, treated it like a job, got into grad school with full funding, and so forth. And since getting out I have spent my whole life in public service.

Yeah, I kind of like America, too. I served it, still do, and am grateful for every opportunity I've had here. Never asked for anything, never expected anything.

And congratulations on your decision to become a teacher. I work with pre-service teachers every day. It is a recession-proof job. 3.2 million teachers in America working in 100,000 school across 14,420 school districts. And 15-20% of teachers leave the job every year (80% of those entering the profession will not last 3 years as a teacher). Lots of variety out there in work environments and opportunity, if you are willing to move. I'm too lazy to cite right now.....ask any of your C&I profs if any of what I said is true. They'll say 'Yes', of course.

(If you don't want to deal with the loans, if you have any, come out here and teach in a Title I school on the res. Federal loan forgiveness after 3 years, if you can survive. Most can't. See? There is always a way.....)

Did I say that? Well, schitt....I must have been hitting the malt hard.

(j/k.....I know I didn't say that.)

So, again, what is the problem with a board hiring a guy with a proven track record of sound business acumen and proven work history, a guy who has risen to the top on his own merits? In this country of ~390 million people, very few have the skills, intelligence, leadership, and history that merit a C-suite executive position. Those that fit the bill do cost a bit--they're rare birds. Boards always looking to save money are free to hire a soapbox-MBA from the employee breakroom for a lot less, but they don't. Ever wonder why?

So far, no one can accuse Wandell of inaction. Let's wait two quarters and see if it's working.

 

It's the American way! Wish it wasn't.