…from AIG executive Jake DeSantis.
Update: Mob rule.
David Foster
Manufacturing, the Ivy League, Jarvis Cutting Tools, and Toyota
Bill Waddell argues that American government and business suffer from excessive dominance by people from a small number of “elite” colleges and prep schools.
In the comments, Costikyan Jarvis–who runs a family-owned manufacturing business–defends the value of the Harvard Executive Education program which he attended:
First, my professors were very diverse. They came from North America and Asia and had a variety of experiences. They had worked in private industry and some still served on boards of various companies. I enjoyed some more than others, but they were all excellent.
More important was the student body. I, and most of my other classmates, learned more from each other than our professors. Of the 143 people in the course, 45 are from the United States (about 30%). So yes, we were all located in Boston, but we came from all over the world.
and
I can not speak for the other programs, but if you ask my fellow classmates why they chose Harvard it is clear we feel that Harvard is the best. Yes it is the best in our minds (we decided to spend the money), but there is no doubt that the institutions that you mentioned attract some of the best professors and students from all over the world.
Today, Bill responds to Costikyan’s response:
Indoctrination at U-Delaware
Here’s a video, made by the American Council of Trustees and Alumni, about the indoctrination programs that have been implemented at the University of Delaware as part of their Residence Life program:
Part One
Part Two
Watching this, I was reminded if a German folk song that dates from the early Middle Ages: Die Gedanken sind frei. This translates as “the thoughts are free”…in one of the many versions of the song, it is “only the thoughts are free.”
More on the Bonus Issue
Wells Fargo didn’t want any TARP money, but the government forced it to take more than $5 billion worth, so Wells Fargo employees who receive bonuses would be subject to Pelosi’s proposed tax. Say you’re a teller at a Wells Fargo branch in Minnesota and you’re married to a lawyer who makes $250,000 this year. You get a $10,000 bonus for your good work during 2008. The government steals it all (90 percent federal plus 8.5 percent state plus, unless it’s included in the 90 percent, 3 percent Medicare). That is simply insane.
If the Pelosi bill is actually enacted into law (which I still think is doubtful) and upheld by the courts, there is no limit to the arbitrary power of Congress. In that event, we have no property rights and there is no Constitution–no equal protection clause, no due process clause, no impairment of contracts clause, no bill of attainder/ex post facto law clause.
See my previous post here.
AIG Bonuses
Anyone want to talk about the AIG bonus situation?
A few thoughts to start things off:
1)Clearly, AIG has been terribly mismanaged. And the U.S. financial sector as a whole has become too large, in terms of its total size–including employment and employee compensation–relative to the economy as a whole.
2)The fact that a company has been mismanaged does not necessarily imply that everyone in it has done a bad job. Almost certainly, there are people in the bonus pool at AIG who have successfully achieved their individual goals, regardless of the failures of top management.
3)Bonus plans, in my experience, generally have two components: success of the individual in meeting his own goals, and overall success of the business. (“Business” does not necessarily mean the corporation as a whole–for example, an engineering manager at GE Transportation might be bonused based more on the results of the Transportation business than the whole company.) In general, it makes sense for the proportion of the bonus tied to overall business results to go up with the individual’s organizational level. It appears that there wasn’t much tie to the overall results for the people in the AIG pool being discussed.
4)Bonus plans are usually a part of an individual’s compensation package and, as such, are legally enforceable contracts. I believe that in some states, failure by a company to pay compensation that is owed can result in additional damages, above and beyond the payments themselves.