Category — GM

The great tax cut to the middle class reached a bit deeper  than the $250,000 cutoff. In fact, it went a wee bit below $100,000.

By the time The One bailed out the fat cat union bosses at Ford and GM, got open voting card checkoff, it stopped just above $13,900, which is good, cause Lil Ewell here kin now get him sum pants.

And a used Ford, iffen we’re lucky! And sum tarpaper for the saved home.

The board of director’s role in corporate America needs to be rethought.  Instead of providing oversight and accountability, most are entrenched cheerleaders for the company’s management team.  Take General Motor’s Rick Wagoner in the perennially troubled US auto industry as a classic example.

Mr. Wagoner has been a C-level executive at GM since 1992.  He was steadily promoted until he became the CEO in June of 2000.  Unfortunately, Rick’s rise and GM’s performance were negatively correlated as this chart of GM’s stock price over the last decade notes:

How does the board feel about his leadership given the current woes?

Mr. Wagoner still has a strong voice in crafting details of the new strategy, a person close to him said. He also has support on GM’s board. Key directors still believe the management team under Mr. Wagoner is capable of delivering a turnaround and insist “we will win or lose together,” this person said. Despite GM’s mounting troubles, the board is anticipating management will soon notch “some victories under our belt,” one director said, asking not to be named.

What a nice sentiment.  Senior management and the board are going to shuffle the deck chairs on the Titanic together.  After all, the 10 year “turnaround” plan is just about to yield results.  Have faith.

Of course, if the predominant trend continues, the company will hit bankruptcy or require a huge government bailout.  Either way, the stockholders, employees, and taxpayers lose while executives walk away with millions in previous compensation and buyouts.

Therefore, the board should understand that some of us are more “together” in this than others.  And maybe, just maybe, they should get off their asses and start analyzing the situation and holding the executives accountable.  It’s something they should have done 5 years ago.

Sadly, the scene at GM is repeated far to often in corporate America.  Boards need to be far more active in steering the company and holding executives accountable for results.