Last week, our duly elected representatives were shocked – shocked! – to learn GM, Ford, and Chrysler’s CEOs had the nerve – the nerve! – to ask them for money after flying on corporate jets. It didn’t take long for the media to smell the blood in the water.
“GM has eight jets in its fleet!” sputtered Bill O’Reilly.
Here at Automobile we too were taken aback by this show of arrogance. “The greatest PR debacle of the year,” executive editor Joe DeMatio called it. At the same time though, we could not help but wonder if Messrs Wagoner, Mulally, and Nardelli were really the only troubled executives who aren’t worrying whether their suitcases weigh more than fifty pounds. So instead of working on the next print issue looming ever closer to deadline, we did a bit of gumshoeing. Here’s a sampling of what we found:
Unlike the automakers, Citigroup’s CEO, Vikram Pandit, will not have to come begging to Washington D.C. The troubled bank received a $20 billion injection of taxpayer money over the weekend with nary single testimony.
Nevertheless, if Citigroup does suddenly need to come before Congress, let’s say to present a plan for a turnaround (something many analysts call unlikely), it’s safe to assume that Mr. Pandit will be traveling aboard one of the company’s corporate jets.
As a matter of fact, Citi maintains a wholly owned subsidiary, called Citiflight, for the purpose of jetting its executives around the world. To Pandit’s credit, he reimburses Citiflight for all private use of the corporate jet.
Ah, AIG. The erstwhile, recently socialized insurance company has received $85 billion from the government – more than triple the automakers’ request. To be fair, it has also gotten its share of negative attention for its ill-advised $500,000 spa getaway.
But at least AIG executives – or should we call them comrades – haven’t been whirling about on their own airplanes, right? Wrong. In fact, AIG required former CEO Martin J. Sullivan and his family to use the corporate jet for their personal business. AIG ousted Sullivan in June (with a healthy severance package), and announced yesterday that its new CEO, Edward M. Liddy, will be working for a $1 salary. Rest assured though, he will not be using that dollar on plane tickets.
Perhaps some of the righteous anger from our elected representatives was from withdrawal. They haven’t been allowed to ride aboard corporate jets for years. Well, actually, make that months. The Open Government Act of 2007 banned lawmakers from accepting gifts, including some kinds of private travel, from companies or lobbyists. But before you start donating your frequent flyer miles to them, be aware that they still get plenty of free rides, albeit of the lowly commercial sort.
For instance, Rep. Gary Ackerman (D-NY), who found “delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hands,” ironically got a free trip to Hawaii a few months back to attend a seminar on U.S.-China relations.
It’s safe to say nobody has lost more money in the last eight years than the United States of America, which fell $455 billion short this year. I don’t have to tell you who will be responsible for a government bailout of the government.
And yet, President Bush has been jetting around the world in a tricked out Boeing 747. If airport security has really been improved, why don’t we ever see the commander in chief trying to fit his deodorant into a Ziploc bag?
So what’s the point?
The point here is not to embarrass any companies or politicians, although they do make for easy targets. In fact, the flying habits of the named parties all apear completely legal and above board (companies often explain their use of corporate aircraft in yearly statements to the SEC, while Congressmen must disclose all privately funded travel on a publicly accessible website). One of the companies even offered me a cheerful, albeit strictly off the record explanation of why it’s only wise for executives to avoid commercial travel.
Was it wise for the heads of the Big Three to take their jets to the capital? Obviously not. They should have taken Northwest – Congressional hearings almost never start on time, anyway. But it also has no real bearing on whether the automakers – and their three million employees – should receive a bailout. Perhaps the government, and for that matter, the media and the public, should discuss such weighty matters on their real merits, rather than flighty, absurdly selective morality.