Oscar,
Thanks for your response. You claim that I got so many things wrong, but then don't really point out much by way of any error in my statement. For example, I never mentioned the MD-88s one way or the other but you claim that must have forgot that part. I think you are making more assumptions on this point than I am. While the US proposal certainly did include the reduction of redundancies and unnecessary assets (as it should have), neither you not Moak could possibly project the meaning of that to the pilot group(s) once the merger was complete. The pilot SLI would have to be competed before anyone could determine if DL, US East, or US West pilots would be more or less impacted by the proposed Management changes. In the interim a pilot merger Transition Agreement would have been required and the DL pilots could seek protections for their group via that document. Was there a proposed TA with the pilots or are you just speculating as to what would happen under your worst-case scenario?
If you re-read my post I specifically said that the DL stand-alone reorganization plan was anemic, but you made a reference to the first year after the merger with NW. Those are two very different and incompatible statements. I personally believe that the DL/NW merger was far better for those two airlines, and the industry as a whole, than if both companies had remained separate. I also think that the US/Parker hostile takeover attempt played a non-insignificant part in having Anderson appointed to the BOD and subsequently selected to be CEO for the express purpose of facilitating a post-bankruptcy merger with NW. If I recall correctly, that was absolutely not Gerald Grinstein's plan for a successor and he (publicly) preferred no merger at all (my Delta and all). If Grinstein would have had his way (actual plan of reorganization), then your nice bonus checks would have been quite a bit different.
You say: "The DL/NW merger did not need any extra cash, we had over $6 billion in cash combined, why borrow more money when you don't need it." There are several problems with that statement. First, money invested from outside sources (stockholders) is not a liability (borrowing money) on the balance sheet. It is considered equity rather than debt and thus strengthens the overall health of the organization as opposed to debt which weakens the financial health of the organization. Second, having a total of $6 billion sounds impressive, but that most certainly does not tell the whole picture. According to DL's 2008 SEC financial reports, the combined airline lost $8.9 billion that year (not healthy) and it had $44 billion in total liabilities compared with $45 billion in total assets, or only $1 billion in total equity (Assets=Liabilities+Equity). In case you aren't aware, a 44:1 debt-to-equity ratio is really not good at all. The US/Parker proposal would have immediately pumped far more equity into the combined US/DL financials resulting in a healthier company on any objective measure.
Please show me where in my post I claimed that the DL/NW was a "failed merger". I'm just not seeing that denotatively or connotatively anywhere in my previous post.
Doug may make you shudder, but he is the longest currently-serving CEO among the major airlines and yet he has never led an airline into bankruptcy court and faced more challenges than all of his peers combined (9/11, merger of to majors, oil price spikes, worst recession since WWII among other challenges). The former CEOs of WN, AA, DL, and UA all bowed out in the last decade and were replaced, with the exception of Anderson, with CEOs new to that position and with far fewer trials by fire under their belts.
