Day 28 of 'The Daily Post'.
Do you remember about this time last year, the senior executives of General Motors went to ask Obama for a bail-out from public money, and they travelled to the meeting in private jets? Obama pointed out that this was something of a gaff, and the executives were publicly humiliated. I thought Obama did well to point it out. But what about this?
The main industry of the city I live in is aircraft manufacture. It is home to three big producers of private planes. Between them, Learjet, Cessna and Hawker make 45% of the world’s business jets. After Obama’s criticism of the GM executives, large numbers of orders were cancelled or postponed, and new orders dried up. Business travel by private jet was no longer as desirable as it had been. Last year, these three companies produced 11,500 private jets. This year, they expect to produce 7500, and next year, 6,500. Their market research suggests that they won’t be back up to 2008 demand until 2017. In the past year, 13,000 people have been laid off. Others are working reduced hours, or being given periods of compulsory furlough.
I don’t really know how to feel about this. I don’t think the world needs to add to its global warming problems by having senior business people flying around in their own, or leased, jets. Should I be pleased that orders are so severely reduced? On one level, yes, but that’s not the reason these people were made redundant. You have to feel sorry for those 13,000 people. I would feel sorry for workers made redundant from the tobacco industry, in spite of what I hoped for the future of that industry.
I feel a particular sympathy for those 13,000, though. It happened so suddenly. One news item, and their fates were sealed. It was unforeseen. Yes, you’d expect a recession to bring a reduction in orders of business planes, but this was a drop of a 35% in a single year. It must be galling that it wasn’t even a matter of government policy. The incident was symbolic not substantive, the result of an unscripted reaction from the President. Most of all, I’m sure those workers don’t appreciate the irony that GM jobs were saved by a bail-out, but there’s no public subsidy for the aircraft manufacturers.
I’m sure we all, if we’re honest, enjoyed the embarrassment we imagine those GM executives experienced. It was a time when we felt the mighty deserved to fall. It wasn’t happening, and the GM executives took on the role of scapegoat. Since they weren’t actually going to lose their jobs, then being taken down a public peg or two by the President was the next best thing. The corporate bottom was smacked. But spare a thought for those 13,000 whose lives have been turned upside down by that one incident, an incident which, because it came from the White House, caught the public imagination and gained publicity, took on a significance beyond its worth.
I remember the outcry following that meeting - but of course had no idea of the impact. So strange to think that if the GM execs had had the sense to make a different decision and get on a charter plane - even just for PR sake given the circumstances and media attention - these innocent people would still be in work.
ReplyDeleteThe thing that saddens me the most is that these families are probably most definitely struggling now. I fail to see how people who lose their jobs manage in America, with a system that isn't set up to support them.
Everything in this interconnected world has an effect on everyone else. One of my sisters works for a debt collector. Their business is booming.
ReplyDeleteIt's impossible to say how much the private jet business would have fallen without the president's GM comments, but I would bet it would have been a heck of a lot due to the industries affected most by the economic downturn. So I'm not buying it. I suspect most people forgot about the GM comments but that the private craft business was always going to take a tumble, along with other luxury goods at the high end of the market.
ReplyDeleteWell, they say he's the most powerful man in the world, what a responsibility. Don't think I'd dare open my mouth. You wouldn't even dare make a joke. What repercussions might that have?
ReplyDeleteNFAH - I think the decline in orders WAS a result of that incident, based on what I was told by someone in the industry. Of course people in the affected companies might not be the most unbiased sources of information. But intuitively, it makes sense to me. Can't you just imagine companies with new jets on order panicking as to how that looked?
ReplyDeleteI'm sure you're right that orders would have declined a little, but my guess is not so suddenly or so much.