When Smith wanted to move GMC's production plants to eliminate American Labor costs, what were the right questions the Board of Trustees/Directors should have asked before taking it to the stockholders?
There are checks and balances here, but, no one is executing them.
What the Board of Trustees did was to look at the balance sheet Smith provided and listened to how he was going to make their dreams come true and make them rich by diving into the "GMC Infrastructure" rather than building a better mouse trap.
EASY MONEY.
Every municipality knows it's tax base. Every corporation doesn't know their product base.
Why?
Boundaries. A municipality's tax base can only grow if it annexes neighboring municipalities and it is done all the time. Supposedly, the annexing city can provide infrastructure to the annexed municipality cheaper and faster because they just have to dispatch their police and emergency response over a greater area. What is the big deal? Sometimes it is not a big deal, but, if the annexed area is large, then it becomes a very big deal. But, the extra taxes that will become part of a municipalities treasury is guaranteed.
Government takes a lot more skill in protecting the integrity of a municipality than a corporation does. A corporation can reorganize, merge and simply close up shop with no regrets. A government entity can't do that.
So, to think for one minute corporate CEOs are the answer to governing is a huge mistake. Governing has to provide services, corporations are suppose to provide profits and those profits don't have to provide services to their employees.
Government and corporate realities are very different. The paradigms don't intersect.
What the Board of Directors/Trustees should have asked Roger Smith was, "Roger, where is all this going? Where are the balance sheets about the future of the company. I don't want to know how much I am going to put in my pocket next year so I can finally buy my yacht outright and sail into the sunset with my spouse, I want to know what the future of GMC looks like ten and twenty years from now."
The people with the most power at GMC never asked the right questions. They allowed themselves to be pulled into a reality of a greedy CEO. At the time Roger Smith was CEO the word "Multi-national" was very fashionable. If companies were multi-national why that meant earnings the size of the planet itself. The problem wasn't the word, no different than today, it was the METHOD of achieving the goal that was the problem.
The worry is that 'the method' hasn't changed since the day of Roger Smith and it isn't the profits that are rolling in, it is the residuals within governments that are being drained.
The USA federal government is being asked to do more with much, much less income. The tax base of the USA has shrunk because the citizens earn far less than they used to earn. The population grows, requires more services but the tax base doesn't increase in proportion.
The method the CEOs use to balance their books and earn huge bonuses is about draconian measures, not that of growth or invention or long term strategies.
The Republicans are "W'rong. They have been wrong for a long time and the USA shows it. Our economy has to reflect healthy private enterprise with stability and sustainability. Our economy has to 'be there' to insure our sovereignty.
Government doesn't have control of the private industry no should it, but, it does have the right of reassurances from those seeking to make profits within our borders. When a corporation the size of GMC decides to move it's operations to Mexico while destroying an entire region of the USA's economy there should be all sorts of warning bells sounding and the corporate structure needs to be asked to reflect on the foolishness of those decisions.
Roger Smith should have been thrown out on his ear, but, it just wasn't fashionable to have a wealthy man not be thought of as a genius.
Every private corporation should ask itself, whom is in their brain trust and who are they leading exactly. That is if they are longing for a sustainable corporation or one that simply devours the assets of others.
There are checks and balances here, but, no one is executing them.
What the Board of Trustees did was to look at the balance sheet Smith provided and listened to how he was going to make their dreams come true and make them rich by diving into the "GMC Infrastructure" rather than building a better mouse trap.
EASY MONEY.
Every municipality knows it's tax base. Every corporation doesn't know their product base.
Why?
Boundaries. A municipality's tax base can only grow if it annexes neighboring municipalities and it is done all the time. Supposedly, the annexing city can provide infrastructure to the annexed municipality cheaper and faster because they just have to dispatch their police and emergency response over a greater area. What is the big deal? Sometimes it is not a big deal, but, if the annexed area is large, then it becomes a very big deal. But, the extra taxes that will become part of a municipalities treasury is guaranteed.
Government takes a lot more skill in protecting the integrity of a municipality than a corporation does. A corporation can reorganize, merge and simply close up shop with no regrets. A government entity can't do that.
So, to think for one minute corporate CEOs are the answer to governing is a huge mistake. Governing has to provide services, corporations are suppose to provide profits and those profits don't have to provide services to their employees.
Government and corporate realities are very different. The paradigms don't intersect.
What the Board of Directors/Trustees should have asked Roger Smith was, "Roger, where is all this going? Where are the balance sheets about the future of the company. I don't want to know how much I am going to put in my pocket next year so I can finally buy my yacht outright and sail into the sunset with my spouse, I want to know what the future of GMC looks like ten and twenty years from now."
The people with the most power at GMC never asked the right questions. They allowed themselves to be pulled into a reality of a greedy CEO. At the time Roger Smith was CEO the word "Multi-national" was very fashionable. If companies were multi-national why that meant earnings the size of the planet itself. The problem wasn't the word, no different than today, it was the METHOD of achieving the goal that was the problem.
The worry is that 'the method' hasn't changed since the day of Roger Smith and it isn't the profits that are rolling in, it is the residuals within governments that are being drained.
The USA federal government is being asked to do more with much, much less income. The tax base of the USA has shrunk because the citizens earn far less than they used to earn. The population grows, requires more services but the tax base doesn't increase in proportion.
The method the CEOs use to balance their books and earn huge bonuses is about draconian measures, not that of growth or invention or long term strategies.
The Republicans are "W'rong. They have been wrong for a long time and the USA shows it. Our economy has to reflect healthy private enterprise with stability and sustainability. Our economy has to 'be there' to insure our sovereignty.
Government doesn't have control of the private industry no should it, but, it does have the right of reassurances from those seeking to make profits within our borders. When a corporation the size of GMC decides to move it's operations to Mexico while destroying an entire region of the USA's economy there should be all sorts of warning bells sounding and the corporate structure needs to be asked to reflect on the foolishness of those decisions.
Roger Smith should have been thrown out on his ear, but, it just wasn't fashionable to have a wealthy man not be thought of as a genius.
Every private corporation should ask itself, whom is in their brain trust and who are they leading exactly. That is if they are longing for a sustainable corporation or one that simply devours the assets of others.
