washingtonpost.com
CEOs You Don't Want in the Cockpit
By Harold Meyerson
Tuesday, April 22, 2003; Page A19
It's a good thing that Donald J. Carty, the chairman and chief executive of American Airlines, doesn't also pilot one of its planes. If he did, and if the plane went into an uncontrolled dive and he handled it the same way he's running the company, he'd bail out as the plane fell to earth, drift dreamily down on a golden parachute, land lightly amid the carnage and give himself a nice cash bonus for coming through unscathed.
Over the past week it has become clear that Carty has engaged in the same kind of double-dealing, to conceal the same kind of double standards, that last year made his fellow Texan and CEO Ken Lay a household name.
While Carty was convincing American's pilots, mechanics, flight attendants and baggage handlers that they had to accept major pay cuts (ranging from 15.6 percent to 23 percent, and kicking in on May 1) if the airline was to avoid bankruptcy, he was secretly crafting a "retention bonus" for American's top seven executives that would reward them for staying at their posts until 2005. The bonuses, all but one set at twice these executives' annual salaries (Carty's would total $1.6 million), weren't keyed to performance -- a prudent proviso, because American lost $5.3 billion in 2001-02 and things aren't exactly looking up yet. Instead, they seem to derive from the maxim of business guru Woody Allen, who once noted that 90 percent of life is just showing up. Carty's corollary is that if you run the company, just being there can be grounds for doubling your pay so long as nobody's on to you.
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