Slashdot Mirror
A Reflection On Sun Executive Payouts For Failure
With the Oracle/Sun merger finally completing at the end of January, one former Sun worker has taken the time to reflect a bit on the extravagant compensation and golden parachutes that the former executives at Sun are receiving for failing at their jobs. "I think it's fair to say that, for all the miscues that eventually led to its demise, the company created many products and technologies of value along the way, enough so that Oracle thought it was worth it to acquire them and try to keep them going. However, I think that it's equally fair to conclude that, after years of running losses, including about $2 billion in fiscal 2009, so that a buyout was necessary to avoid looming bankruptcy, Sun's executives did nothing to deserve lavish rewards, by any conceivable meaning of the word 'deserve.' But what actually happened is by now a familiar story. [...] And here's a prediction that I feel quite certain of: if, against expectations and my hopes, Ellison drops the ball and things start going south for Oracle, it's the employees who will suffer for it, and he'll be doing just fine."
If only they would have gone on Undercover Boss. All would have been solved.
As almost always in big business, those in control will make sure that their personal interests are met, even at the expense of the company as a whole. It is more important that the board makes sure they all get several million payout should the company fall apart.
We were all warned a long time ago that MS products sucked, remember the Magic 8 Ball said, "Outlook not so good"
Not a huge surprise. They aren't going to spend time and energy on others when there's money to be had.
Humans are terrible replicators of Godly things.
The system will regulate itself? HAH! yeah, keep voting for the big bucks ...
Yes, I'm left. You have a problem with that?
I thought you could.
Don't worry, I'm sure they'll do better at their new jobs with Goldman Sachs, J.P. Morgan Chase, AIG, ... (sigh)
It must have been something you assimilated. . . .
How Companies Work
There are a few top managers, and they run the company for their own interests. If they have stockholders, they have to make some pretense that they are working for the stockholders, but look how much stock _they_ are getting out of the company. Sometimes they collect a $1/year salary to look good, while they get many Millions of dollars in stock per year. Rarely do people at this level work for anyone but themselves.
Then there are a number of second-tier managers, whose goal is to make the most out of the company that they can, or to make it to that top level so that they can run the company for their own interest. Sometimes people at this level have other motivations.
Then there are lots of other people. Often these people haven't even thought very deeply about what their motivations are. They are essentially treated as work-units which keep the company operating, but they are as expendible as a server in a rack. Fortunately, companies do need their talents, at least for now.
Then there are the small stockholders. They cross their fingers and hope the managers will do a good job for them, but they really do not have any power to influence the company.
Then there is the government. The government's job is to protect little guys with no power (the general population) from big guys with lots of power. But unfortunately the big guys essentially own the government, because of the fact that they pay for political campaigns and in other ways influence politicians, and because they are gate-keepers on jobs for voters.
All of this motivated self-interest is supposed to result in a good working system for the general population. It doesn't work terribly well. However, there are many other systems that work even worse, so people are reluctant to change it. Also, the average person can not be bothered to concern himself enough so that in the aggregate with other people that person can effect change.
Bruce Perens.
Isn't this the norm for big businesses? It's sad and all, but why is this news?
Let's compare the total money he has been paid in 20+ years to the total salary that Sun has paid out to all it's employees and shareholder dividends before you decide the compensation is lop sided. Say what you want, this article is sour grapes.
Sometimes its nice to know that while most of us actually work our jobs and do them very well, some companies like sun employ people where their only job is to screw the company and its employees for money they don't deserve.
1. Develop great products.
2. Run company into ground.
3. ???
4. Profit w/golden parachute.
This seems to be a very successful formula for many executives over the last decade. Not that society benefits from all this "creative destruction" to enrich a few people.
...But if we hadn't paid them a competitive salary we might have lost them.
SJW: Someone who has run out of real oppression, and has to fake it.
I'm thinking that DailyKos got the link on this one because everyone else got done talking about the potential golden parachutes back in June of 2009.
http://www.theregister.co.uk/2009/06/12/sun_network_gets_it/
Don't know something? Look it up. Still don't know? Then ask.
Uhm. WTF. The article would have been better if it focused on EITHER divergent views on social liberalism vs conservatism OR the fact that Sun screwed itself repeatedly through bad management yet still somehow found a buyer (who's the bigger fool?).
As it is, the article comes of as an angry, rambling rant flipping between one or the other yet not making a cohesive point - aside from slamming capitalist and conservatives - but hey, it's on the daily KOS, so no great surprise there.
Sun was a company with great tech, at the time. But if it's one thing technologists need to understand - it's not how great your product is, but how well you can a) SELL IT (capitalist dogs!) and b) EVOLVE it - fall behind and instead of going to the great socialist nirvana in the sky you get eaten up by the darwin doggies that took you down.
What happens to sun now is anyone's guess. Oracle's got it's fair shair of WTF and Brilliant! moments, more of the former recently.
be0wulfe
Ferris: [to the camera] If you had access to a car like this, would you take it back right away?
[beat]
Ferris: Neither would I.
oldhack: "Security is a waste of money until shit hits the fan. 5 minutes later, it becomes waste of money again. "
And this seems like another example of employee theft.
The only difference between employees in upper management and all the other employees is the scale of the looting.
Why do shareholders tolerate this?
I loved my sparc 1+ with the funky ruled reflective mouse pad, and the quirky SunOS. For some reason I always wanted pizza for lunch after working on it all morning. Ahh those were the good days, oh mosiac how we used you to find things in the larval days of the web.
Linux really ate Sun's lunch. All the reasons to own a Sun largely evaporated with Linux. I say that as a researcher and end user, not a data center wienie. As soon as linux and commodity hardware got good enough, it was all over for Sun. I really feel bad (and old) but frankly I'm surprised that they lasted this long.
Sheldon
In the introduction I referred to what I call the "Reaganist dogma" of the free market, my description of what a Republican might refer to as "capitalism" as opposed to "socialism".
Reagan got that from the economists. He didn't think that up himself. That's one of the incorrect assumptions economists use in their models and theories - free markets always work and that the market is rational.
Free markets work only within a narrow range of economic activity. If they exceed those ranges then you get bubbles and collapses. That's why the Fed was created to try to eliminate those things. Of course, if you get a Randian dogmatic believer in the free markets of a Fed Chairman (Greenspan), then you end up with serial bubbles: stock market and real estate.
There's a few other blanket assumptions that economists make that are horribly incorrect in the real World, but I'll save those for another time.
Oh, and economists need to get over their physics envy. They develop these impressive mathematical models and everything but the underlying assumptions are incorrect. As in this example, the assumption is that markets are rational. As we have seen, they are hardly rational.
Reading assignment: rational irrationality.
Oh, OK the last thing: the behavioral economists are redeeming the whole "profession"! :-P
Well, not that you mention it... :)
Diatribe or not (no, I didn't bother to read it), I don't think Oracle's is going to be anywhere near the kind of situation Sun ended up in for the foreseeable future. Sun had multiple sources of direct competition across a good deal of their product range and many IT budgets just couldn't justify paying the extra cash for the few extras Sun brought to the equation. Oracle, on the otherhand, has seen off almost all of its competition: DB2, Ingres and Informix are either history or essentially relegated to also-rans in the marketplace for high-end DB servers with paid-for support and an SLA that you could take to court if you had to. It's going to take a screw-up of positively epic proportions for Oracle to go down the pan; "dropping the ball" wouldn't even come close...
UNIX? They're not even circumcised! Savages!
This is hardly specific to Sun. Somewhere over the past 30 years the notion of a bonus has changed from being a reward for a job well done to being an entitlement - a basic part of the compensation package.
Or rather, that notion has changed among the executive class. Ordinary working stiffs weren't informed, which is why they are outraged at bonuses for failure.
Sheesh, evil *and* a jerk. -- Jade
...if Ellison drops the ball and things start going south for Oracle, it's the employees who will suffer for it, and he'll be doing just fine.
Welcome to the real world. This is the way of things. Get used to it because it's never going to change.
As with most dailykos stories this one leaves me confused. SUN's former managers were so greedy that he got a year's severance? Oh he's just angry that someone got more than him.
You're completely right. And that is why Bernie Madoff is a god!
the serfs may starve, but the lords still get their due.
Success or failure is irrelevant. It's a buddy network, and these guys have no interest whatsoever in the long-term well-being of their companies. They'll get top executive positions elsewhere if they want it. They'll make some big, short-term changes when they hop on-- layoffs are great for their bonuses, the bonuses are all about short term profits-- trash the company, and move on. It's a grifter aristocracy.
Look at execs from AOL, Yahoo, now Sun... hell, Carly Fiorina is running a campaign to do to California what she did to HP. Ask anybody who worked at HP while she was there, or any stockholder, how that works out. At least the citizens of California will have some say over whether she is taken on. Hard to believe such a tech-savvy state would fall for her, but...
And Sun execs. Oh ho, they're brilliant. "We hate Linux! We're doing Solaris x86! Linux rules! We're cancelling Solaris x86! Linux is GARBAGE! We're the biggest Linux providers in the world! No, wait: screw those customers. Oh hey, we have Solaris x86! I mean Linux! I mean OpenSolaris! Okay, now it's really open! It runs all that great OSS stuff without that horrible Linux!"
Yeah. They've done very well by themselves. And will continue to do so.
They are payouts as specified in the executives' employment contracts. Next time you hire executives try to negotiate better contracts.
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
Techies often have trouble understanding this, coming as they do from a very strongly meritocratic culture: the world at large is so far from being meritocratic that the sheer extent of its non-meritocracy strains the imagination. Professional academics often run into the same blank wall of incomprehension.
By no means am I saying that this is a good thing, or even that it is strictly necessary (though that is certainly a possibility given primate psychology), but the fact remains that the normal means of acquiring wealth is by conniving, cheating, swindling, and deceiving to one degree or another. If wealth was awarded on the basis of hard work, knowledge, or creativity, then the world would be full of super-rich construction workers, mathematicians, and artists. Instead, it is awarded on the basis of how good you are at talking (or coercing) people into giving it to you. Period. Things like quality, reliability, creativity, and utility are, at most, means to an end, and are by no means indispensable, except perhaps as grist for motivational speeches given to the people who do the work by the people who receive the rewards.
Proud member of the Weirdo-American community.
This is because the average person probably isn't thinking much farther ahead than what he'll have for lunch tomorrow.
I'm pretty average and I'm thinking about pizza a couple of days from now. You must be pretty smart, to know so much about average people, and pretty arrogant, to be so wrong.
This is my sig.
Here is a theory that I heard expressed by a C level corporate executive :
The top people should be paid enough to make the people on the rung just below them green with envy, so that they will work their butts off to get to the top, and so on, proportionally, down the line. (In other words, the motivation is not greed, but envy.)
I haven't heard this expressed much in public, but it explains the high payments and bonuses in bad times much better than the "we pay them for their successes" theory.
The only way this golden parachute will cease to exist is if the stockholders stop allowing these Executives from creating gold parachutes. Unfortunately stockholders don't do their jobs. Workers need to demand a parachute for themselves in this case. why? because if the stockholders are asleep at the wheel, it's time to steal from the stationary closet.
Develop great products
Where's the great product?
* Java isn't a product, because its free.
* Solaris lost the unix mindshare ware to Linux.
* The side effect of AMD's 64 bit Opteron lunge at Intel was to make every computer 64 bit RISC workstations, so now SPARC is kinda pointless.
* For personal computer, Apple has elegant worskstations down to a science
Bottom line is, computing is a volume business, not a high end one, and Sun was focused on the wrong end of the scale.
Franky, if I was a shareholder of Oracle, I'd be kinda angry that they actually made this buy. The only good thing the company has is MySQL, and that could have been gotten a lot cheaper by waiting for Sun to go BK.
This is my sig.
Scottie got richer. Jonathan, too. Larry has Java.
What's wrong with DailyKos? Do they, you know, actually lie, or do they just say things you don't want to hear? If you think they lie, provide a documented example.
- None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
How much Obama will get after he finishes wrecking the US economy.........
1. USA
2. Europe
3. Japan
Here, "relative" means dividing (1) the annual income of the chief executive officer by (2) the average annual income of the employees who are not part of the management structure.
Table 2 on page 6 of an interesting document analyzing the financial compensation of American CEOs is instructive. For the sake of this discussion, we can reasonably assume that figure in the aformentioned category #2 is approximately the same throughout the West.
Table 2 then, in effect, gives us the relative compensation of the CEOs in the West. The typical American CEO in 2003 received annual compensation that is worth $2.2 million. The typical European CEO received $700,000. The typical Japanese CEO received $460,000.
Was the American CEO worth his pay? American neoconservatives answer, "Yes." They say that such compensation enables American companies to be top-notch competitors in high-technology.
On 2009 November 5, "The Economist" issued a startling report. It asserts, with plenty of evidence, that Japanese companies are the sole manufacturers of numerous components that are critical to the operation of high-technology devices ranging from tiny disk drives to huge nuclear reactors.
So, who is telling the truth? American neoconservatives or the "The Economist"?
If you're feeling a need to point fingers, go look over at the shareholders. Sure, exec's basically set their own remuneration through undue influence over the "remuneration committee", but it gets approved by the shareholders.
It's not going to stop until the broad body of shareholders as a whole start exercising their power. Not just at a few companies with good governance, but everywhere. Shareholders can't be left thinking that they have to turn a blind eye to absurd remuneration or they will simply go get it elsewhere. As it stands, frankly if an exec is not trying to wangle himself some fantastic pay deal then he's probably not fit for the job.
Turning up at the AGM would be a start. Legislation, guidance and listing rules can help significantly though, for example the UK Combined Code of Corporate Governance puts pressure on institutional investors to participate. Allow internet streaming of the AGM together with voting over the internet - how many people have a sufficiently large investment that it's worth travelling to the AGM?
The ONLY reason executives want to get paid in stock is because capital gains taxes income taxes....by a LARGE margin.
Nothing altruistic about someone who makes 131351321 times what the real workers on the front line.
Golden parachutes aren't a Republican phenomena, and the Silicon Valley tech companies aren't exactly fertile ground for the GOP as far as fundraising goes.
Nor is rewarding mediocrity limited to the upper-echelons of society (see: Detroit).
What the author did get right is that the boards of directors make these decisions. In companies where a scant few hold lots of sway, they look out for themselves instead of the working minions. Think Carl Ichan ever got a raw deal on a company he came in and dismantled?
The fixes are simple, but neither political party has the political will to do it. The tax reforms in 1986 allowed most of this, and it benefits wealthy interests (read: donors) on both sides of the aisle. Think Bear Stearns was a high-time GOP operation? How about Fannie and Freddie?
1. Tax stock options as regular compensation, taxed at normal income tax rates. Tax it at the stock's full price on the day the option is exercised. If the option is never exercised, fine. The executive doesn't pay the tax.
2. Place a time limit on option execution.
3. Tax fringe benefits as compensation (hello, "Cadillac" health plans).
4. Encourage firms to hire executives on fixed-term contracts with fixed compensation. Stop making compensation based on stock price performance.
But it'll never happen. And, while I'm glad to see that they're taking notice, the stupid from dKos burns. It burns a lot.
Perhaps they did the best they could in a bad economy, and by engineering the sale to Oracle, they made the best of a bad situation? Certainly if you were a Sun stockholder, you are better off now than you were a year ago, and these guys were big stockholders.
Personally, I'm still pissed at the massive payoff that Carly Fiorina got when HP booted her out the door.... :)
Necron69
Clear, concise explanation of the problem. For all of the moral outrage posted, none of the comments have a clear understanding of the issue.
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
Yea Yea Yea... We know the good old simplified that we like to hear. Where the big bosses are either greedy or idiots, and they do nothing while all their pions do all the work...
Your attempt is to dehumanize the bosses make them seem sub human so you feel better that you are not a millionaire too.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Boards do have their collective heads held to a gun in the sense that if you don't give the CEO the package and word gets out, you won't get the sweet deal as CEO of the other company your head of. Effectively top executives set their own benefits based on the size of the company.
I doubt that Sun's executives do not feel like they have failed at all. I would assume the CEO's resume will make a big deal about successfully overseeing the acquisition. This seems to be the mentality of senior management in the mega corporations.
Barring a modest salary - say $200,000 AT MOST, no executive should be permitted to take more out of a company than they put in. Short term profits and asset sales need to be dismissed otherwise the CEO can just gut the company. The total value of the company when they come in vs. when they go out is what the equation should be based on.
These posts express my own personal views, not those of my employer
Lets face it GOP'ers like McNeally dropped the pretense about Christianity and Christian virtue long time ago. The only use for Jesus that republicans like McNealy have these days is to continue to fool the foolish on the religious right. If Jesus can be used to sell a turd to a sock puppet in exchange for a dollar, he's worth something in their minds, otherwise he's there just to be peed on.
I can sympathize with the writer, but from a different perspective. As an investor I bought into the notion that Sun had good products produced by the kind of worker who wrote the column and that by investing in innovation we can collectively move the country forward. As a result of insider greediness and to some extent my own, I lost my entire retirement portfolio. Yes my mistake, in ever trusting a republican to do the right thing.
I hardly regard the article as diatribe as some who are eager to dismiss it suggest. Rather, it should be a sober, teachable moment to all as to what happens when you let republican philosophy and republican leaders plan a future for you. Your interests will be dropped like a rock as soon as there is an extra dollar to be scammed from the system..
I would encourage anyone who at any time heres the name Scott McNeally to make a point of noting just what a miserable failure and self-interested creature he turned out to be. At least that way regardless of much money he and so many executives like him have been able to game the system for, the McNeally name will forever be tied to A BIG STINKING PILE OF FAILURE. I have moved on, but he and his family will have to live with that reality for the rest of their lives. His money, no matter how much he has scammed will buy him any respect. When you hear a story about Scott McNeally, clear your throat mightily and then just spit it out and move on.
Harvard/Yale/ MBA 101 teaches businesses are nothing more than objects to sell to some other schmuck with too much money and not enough brains. MBA 201 teaches benefit packages are there to make sure you're well compensated for selling the shareholders out. MBA 301 strips you of any morals toward your fellow man/woman and turns you into a card carrying Republican.
Perhaps it never occurred to you that this is precisely why America and Wall Street and your government is broken.
McNeally and his friends used the SUN board to give themselves plenty of stock at the expense of other shareholder's who were not in a position to do so. Consequently, they lived well while the company went bankrupt Its what all US corporations do these days: game the system for the benefit of the insiders at the expense of society. So when things go South and belly up, they get a big reward and everyone else who try hard to make the system work, just get taken for suckers. Politicians have adopted the same lack of principles and commitment to the general welfare of the system.
This is why you are a fool to invest in stocks any longer. There is no possibility of making a reasonable rate of return in the long run. The longer you own a stock the more opportunity the Scott McNeally's of the world have to game the system in their favor at your expense. Wall street is no longer even a zero-sum game. For the average investor its like pulling the lever on a slot macchine. The house skims off 80-90% of the take right off the top.
So in your mind that ok?
Fine, then don't bitch about the economy or anything else and welcome to Hell rather than civilization.
Think about it.
Human civilization will survive if it can win against its reptilian brain's triggers that prompt so many to vote republican and just trigger randomly.
And if he's a manager, he'll steal your lunch and blame it on the bad economy.
The society for a thought-free internet welcomes you.
Intervene with coercive force to appropriate shareholder's private property? Are you some kind of republican shill?
Most shareholder's like me need, indeed require LAWS and REGULATION to protect ourselves from insiders like Scott McNealy and Bernie Madoff, who use their inside connections to game the system. Have you ever wondered why it is CEO's are still allowed to make outrageous sums even when they destroy there companies? Have you ever wondered what might be the consequences if everyone simply shrugs their shoulders as you seem to be suggesting and say, "well ok by me"? Have you ever thought about the consequences of such an approach to taxpayers like you and me? Have you ever wondered what will happen now when no capitalist in his right mind will invest in a company because its just provides license for insiders to rob them blind, while as the insiders smile for the cameras and provide happy talk right up to the point of insolvency?
How many more Ken Lay's, Bernie Madoff, and Scott McNeally endure before people like you wake up to the reality of what the "its all socialism", and "reduce all regulation" slogans have to offer Amerca's future in the long run. Keep it up and you might as well join the Taliban in reducing American to a sort of 21st century feudal kingdom. After all, we will be able to run our Armies, flush our sewers, put out our fires, hire policemen to catch on our criminals, keep our environment healty, .... on lower and lower taxes so the government doesn't "coerce us" right? That way we can leave such coercion to executives at the insurance companies, phone companies, ... right, with no control over what they impose on us, right?
Frankly, I would prefer that the government take half of my investment in taxes for the greater good of society at large than to continue to permit insiders like Madoff and McNeally walk away with essentially all of it because it is legal for them to do so. It seems to work well for most of the rest of the industrialized world, where at least you can get government health care, good quality pensions, trains that run on time, ... If you want to live in a totally dis-functional society keep up with the republican philosophy of "less government and less taxes", for soon Wall Street, which now thrives only as a result of corporate welfare, will crater and society as a whole will crater with it, because there will be no incentive for anyone to participate in any effort toward collective reason.
No wonder republicans have no use for the teachings of Jesus any more other than to continue to lead the sheep at the voting booth to shear them again and again.
If it came down to survival, I would probably have an easier time understanding executive behaviour.
But there's a difference between making a living, and making a killing. As it is, most of these people could stand to shave off several tens of thousands from their annual pay and not even notice, aside from possibly losing some minor degree of pissing-match status associated with any large number for compensation. They're not hurting, not by a long shot. Things are very far from "tough" for this demographic.
When you're making $10mn a year (or even $1mn) and already have several million in the bank, why on earth would you need another $Xmn in severance and bonuses on your walk out the door? Greed is the only answer that seems to make any sense.
Cheers,
"What in the name of Fats Waller is that?"
"A four-foot prune."
Most people of the world are just thinking how and if they will even have another lunch.
In the meantime the Scott McNealy's, Bernie Madoff's and Ruppert Murdoch's are stealing everyone blind making everyone's life a lot more difficult, yet so many buy into the slogans of how "less government", in which we at least have a tiny amount of control over, should be reduced so that it will be easier on the Scott McNealy's, Bernie Madoff's and Ruppert Murdoch's and Ken Lays of the world to make their money, raise their prices, eliminate any obstacle to their own self-gratification.
In the meantime the planet goes to hell in a hand basket.
"Ellison drops the ball and things start going south for Oracle, it's the employees who will suffer for it, and he'll be doing just fine.""
Anything new here? Nope.
Sounds like the status quo in corporate America and 98% of the world (business in general).
And I'm sure fans of 'Coco' know he was the winner (cough: 'CEO') compared to his employees (most a 45K severance, which is avg. for that industry).
The majority of stockholders do not have enough shares to permit themselves to sit on the corporate board and award themselves additional stock options at the expense of the other shareholders. They make up the bulk of the ownership ONLY because they have been allowed to game the system, not because it somehow benefits other shareholders. Don't believe it? Then just look at corporate income and see where most of it goes. Not to shareholders in terms of increasing return on investment but to insiders who skim an ever greater share of the loot before the average shareholder has the time to press the sell button on his PC.
Wall Street greed and executive compensations have reached the point of such ridiculousness that only the insane and those investing OTHER PEOPLE's pensions would be foolish enough to invest in most US corporations these days. The longer you hold such stock the greater time you give to insiders to steal your investment. Lets face it the system is totally broken. Yet so many just shrug their shoulder and think well that is the way its supposed to work, not thinking about the consequences to society as a whole.
Capitalism is in for a far rougher patch than most might have predicted. However, we may just pull ourselves out of it. All we need is just one more good Ponzi Scheme.
What's wrong with a site where anybody can post any kind of opinion?
Nothing. You just have to remember that. Posts on a places like dKos only speak for the poster, not "liberalism" or even "the Democratic Party", even the editorial policy of the site. The purpose of dKos is to help get Democrats elected. The vast majority of what is there does nothing useful for anyone, other than to provide Bill O'Reilly a fishing ground for something to rage at on a slow news day, Hell, he doesn't even have to wait for an outageous comment, he could post one himself. Not that i think he does, mind you. There'd be no point with an infinite number of monkeys at his beck and call.
Basically dKos is too large to police. If you are an abuser and you get noticed, you will be summarily canned, but that often takes a long time and you can simply sign up under a different name. So you can get just about anything on dKos, from astroturfing provocateurs, the usual contingent of sincere loonies, and quite a few intelligent, thoughtful people trying to make themselves heard of the bedlam.
Want to blame somebody? Blame Bush. It was the anti-Bush fervor that took dKos from a fairly interesting site to the madhouse it is today. [Note deliberate use of irony here]
Alternatively, blame the design of the site, which encourages a desperate contest to get noticed before your post falls into oblivion.
But whatever the cause, you're on your own when it comes to content posted there. It doesn't necessarily reflect the philosophy of the site's owners. It may not reflect the political philosophy of the person posting it. Most of it is junk. Some of it is worth reading. All of it is worth taking with a grain of salt.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
I actually know someone who was a Veep at Sun. She is unconcerned at the loss of her job and just purchased her third house on the west coast.
Take this however you'd like. I think it's obscene, but I don't make the rules.
-
For all of the reports of Sun losing billions, note that it finished with a positive bank account. Over its lifetime, Sun generated over $200 billion in revenue.
I think a $200 million payout to Mcnealy (.1% of the company's gross revenues over almost 30 years) is not that unreasonable. McNeally was there from start to end, unlike ponytail.
Not to mention acquiring Sun gives Oracle some serious advantages. One it gives them a "top to bottom" solution, from the hardware to the OS to the software, allowing them to say "the buck stops here" and giving customers a single entity to deal with when problems arise. Two by having Access to the Solaris and SPARC teams old Larry can walk in there and make damned sure their focus is making Oracle as fast and rock solid as it can possibly be on Solaris/SPARC, which I am sure will pay off in future revs, and because unlike Unbreakable Linux he controls Solaris now he can do it, and now that he owns OO.o he can invest in his idea of a cloud based Open Office just to piss Billy off, which you know Old Larry quite enjoys ;-)
So I don't really see Oracle having the problems Sun did. Sun never really seemed to have a cohesive vision of where they wanted to go, and their flip flops on x86 just seemed to make them look more out of touch, while old Larry may be a bastard, he is a bastard with a vision and knows where he wants his company to go. And that is to be the "Big Blue" of databases and to rule the database market the way big blue ruled big iron, which I really wouldn't be surprised if in 5 years they have MSFT level of dominance in the market.
ACs don't waste your time replying, your posts are never seen by me.
All three parts of your claim there are wrong, which makes you completely wrong, not "half-right." From :
To understand that passage, it's important to know that publically-owned banks in the USA are structured as a public holding company, which privately owns a bank. This is important because what you bought was shares of Washington Mutual Inc. (let's call it WMI), the holding company for Washington Mutual Bank (WMB). WMB failed, so the OTS seized it away from WMI and gave it to the FDIC, which then disposes of the assets and liabilities of WMB in order to make insured deposits and secured debtholders whole. At that point, WMI is bankrupt, so your stock investment is not really worth nothing anymore.
But the more important thing to note is that Chase didn't buy WMI from the shareholders; they bought from FDIC the WMB assets and obligations that the FDIC was on the hook for.
You're also wrong about the "buying all the assets, but not the liabilities part." From the FDIC statement on the closure:
This is a standard FDIC bank closure; the FDIC takes care of insured deposits and secured debt of the banks it takes over, and only if there's anything left over from the bank's assets, then unsecured creditors and shareholders get some (in that order). Chase bought the WMB's assets and all the liabilities that the FDIC is on the hook for. The liabilities that Chase didn't get are the ones that the FDIC doesn't normally cover. So basically, the folks who are owed those debts were wiped out by the FDIC takeover, not by the sale to Chase.
And thirdly, the WaMu executives that you claim got paid off handsomely were not paid by Chase. They were paid by WMI, the holding company that went bankrupt. Though the $17.5 million guy actually declined it:
So basically, you made a bet on a bank that was about to fail, without understanding even a single iota of what happens when banks fail, and then you failed to learn how your investment failed. I can certainly understand and sympathize the part about making the bet on something you don't understand, if you hedge your bet accordingly (which you certainly seem to have done). What I can't understand is your inability or refusal to actually learn how your investment failed.
Are you adequate?
Cash and stock are not equivalent. One is money in hand the other is the promise of money in hand. Insiders can print promise of money in hand and convert it to money much faster than the average investor, which gives them increased opportunity to game the system. With stock as pay, what you have witnessed is ever increasing wage inflation for those at the top, while long term costs just get passed on to other shareholders and then society at large in the form of an increased corporate welfare state. You also see less and less payout going to other investors. Is anyone making much money in the market these days other than the insiders who are selling stock and the investment houses that the buying stock with other people's money?
Making all pay only payable in cash would put some sanity back into the market and ultimately support more prudent investing because it would be harder for insiders to game the system as they do now. Yes, it will cost companies money immediately on their books, no accounting gimmicks or commoditized hedge trading on future benefit packages, where corporate insiders work with unregulated hedge fund managers to time shorts so that both benefit at the expense of other shareholders. Sure they take a short term hit on their remaining porfolios, but no matter as they, unlike other investors, can just replenish their stock in bonuses at a timing of their choosing, which they give to themselves. This is not available to other investors.
Cash only compensation would reduce executive compensation packages overall and lower the prices corporations need to charge, while still giving the average investor a chance to at least make a reasonable return on their investment rather than seeing it all skimmed of by corporate insiders, who use their inside status to simply print themselves ever bigger salaries. Right now, there is essentially no reason to invest in stocks unless of course, you are investing with other people's money and then charging them for the privilege.
Yes there are still risks and rewards, but the risks are all to the small investor (who may invest directly or indirectly) and all the benefits are with those who can give themselves big stock options, just before they bail out and the company goes belly up. Scott McNeally is just only one of many such poster children for what has happened to US corporate dominance as stock-based compensation has been promulgated through the system as a perfectly legal way of doing business.
Oh, thank God and it's About Damn Time. Not only did someone post something like this, it got modded to "+5 Insightful."
Finally, please God, finally let the tide turn.
I was around in the late 70s/early 80s when Carl Icahn and T. Boone Pickens started their "Big Lie," that corporations and corporate leaders have no duty but to enrich themselves. When they first started crowing "maximize shareholder value, maximize shareholder value...," they got laughed out of the room. Of course corporations had responsibilities beyond the bottom line. The whole point of giving them tax breaks and the corporate veil against liability was because they promised to benefit society as a whole in their corporate charters.
The raiders refined their argument a bit and started arguing "Maximizing shareholder value benefits society most." (see Danny Devito in "Other People's Money" for a taste of it)
But then Ross Perot and his ilk got their hands around our schools, and a whole generation of kids came out moaning like zombies, "Corporations have no responsibility but to themselves, Corporations should only look to the bottom line..." I've been trapped in this farmhouse for 20 years now, nailing boards over the windows as fast as I can, screaming truth into the dark.
In exchange for the liability shields and massive tax considerations they are given, every corporation ever formed has given us their sworn commitment in their corporate charter that they will benefit society as a whole.
Goid bless you, Man, posts like yours give me reason to hope.
He put his boots up on the table and made a face. "The sig," he smirked. "You can waste your life in search of the sig."
See my Slashdot and Reddit submissions on the problems of shareholder value and agency theory, it has info on what is happening here:
http://slashdot.org/submission/1159318/The-problems-of-the-shareholder-value-ideology http://www.reddit.com/r/reddit.com/comments/axwzw/the_problems_of_shareholder_value_and_agency/ (another new Slashdot submission is coming up soon on this)
A different opinion: Maybe the combination of Sun and Oracle will be called Snoracle.
I think Oracle is on the way down. In the future, companies will run cheap, redundant hardware with PostgreSQL.
Google is already doing something like that. You can see for yourself: Google uncloaks once-secret server.
A lot of what caused the purchase of expensive Sun servers in the past was ignorance. CEOs could be convinced the spending a lot of money with Sun was the only way to have enterprise operations, and they bought Sun equipment rather than using Linux and PostgreSQL. Now there is less ignorance. Many corporate needs can be served with much less expense.
And that's not true either, because (a) most of the liabilities of Washington Mutual Bank were in fact acquired by Chase, and (b) the unsecured liabilities are in the hands of the FDIC, which will most likely never have to pay them. From the FDIC report on the seizure:
The holding company didn't get stuck with the liabilities of the seized bank. Your stock became worthless because the holding company's one big asset, the bank, got seized by the government, and is now mostly an empty shell.
Dude, again, if you make an investment and it fails, make sure that in the end you at least understand why it failed. Otherwise, you've not gained even wisdom from the experience.
Are you adequate?
I understand this fellow is a German. But why does every discussion on American companies and culture come down to this tired Republican/Democrat argument. The rest of the world doesn't really care.
Is SAP in direct competition with Oracle?
"to the extant that the government will not use its power to make the opportunities explicitly unequal."
Yeah. Right. Sounds like you need a history lesson my friend. Weren't the folks that wrote the constitution the same folks that denied the right to vote to anyone not owning property, anyone who was not female, and let us remind everyone of US history, that made slavery perfectly legal? If you are willing to defend that, fine but don't go around telling everyone that people shouldn't demand that one purpose of government is precisely to "coerce people" into giving up totally unjust and unworkable ideas such as slavery, forcing children to work for less then minimum wage, murder, etc. The same is true for taxes. You may not like them, but then again, its a hell of a lot better than the anarchy republicans are selling these days that will no doubt ensure if no one pays any taxes. Have you ever wondered how we would pay soldiers to risk their lives in Afghanistan and Iraq without taxes? Don't we have enough chaos and anarchy in our system now? Why do you advocate for more?
Laws are written to control people so we don't have anarchy and perhaps some modest sense of justice. Most of the time they are written so that what constitutes anarchy and justice is largely defined by those with enough money to buy the politicians and lawmakers to see to it that such definitions are more favorable to themselves. Why you want to grant even more power to corporate elites is beyond me.
Socialism is not the "opposite of freedom". That is just republican bunk for the uneducated and foolish, who will gladly beat themselves about the head if told it feels good. Socialism is a system in which everyone pays in to get benefits from the system as a whole, in which everyone agrees not to rely on third party middle men to can muscle in for an ever greater profit.
You only have to ask all those "oppressed" people in Sweden, Denmark, or Germany how they are faring under socialism, where they have free government sponsored health care, liveable pensions, laws that protect their environment, enough money to fight crime and regulate their markets and trade, pave their streets, support their corporations to compete internationally, make sure their trains run on time, even have trains that work, grant them well-paid government sponsored holiday time, and educate their children so they far exceed US school children in math and science scores, etc. to see if they would trade all it in for your version of "freedom" from government. Do they have problems, yes of course, but they pale in comparison to the failings voters in the US have brought for themselves by buying into republican corporate talking points.
What you are advocating is simply turning the opportunities for coercion over to unregulated, unelected corporate executives, who will not by law be constrained to deny you health care, force your children to work for less than minimum wage, refuse to pay your insurance claim, give your social security pension to Wall Street investors, walk away from your pension plan, let big banks destroy the financial system by fraudulently selling worthless paper, let guys like Bernie Madoff go free no matter how bit the scam, let your cable company charge you hundreds of dollars a month to watch their commercials, etc. No doubt, all a republican's wet dream.
Sorry to be impolite, but you are so caught up in your own rhetoric that you don't even recognize that what you are advocating is anarchy or at best corporate feudalism.
See this: Continuous Archiving and Point-In-Time Recovery (PITR). PostgreSQL is becoming more sophisticated every day, and redundant hardware is reducing the need for sophistication.
by and large just got their clocks cleaned in the current Wall Street meltdown.
The only thing that differentiates them as "savy" is that they couldn't care less as they invest OTHER PEOPLE's money.
You think the executives of Sun are a problem?
Trillions to the bankers who are still being paid bonuses.
Deleted
Its not sour grapes but rather yet another tale of what happens to a society that lets corporate insiders run loose at the expense of employees, shareholders, and taxpayers. Ignore it at your peril.
In any event, there is no logical connection to the total amount of money Sun paid to its employees and the money Scott McNeally and other like corporate insiders got by gaming the system for their own benefit. It is not as if he was using his money to pay the employees. No, it was mine and as a stockholder of SUN I got my clock cleaned. Does it matter to you? Probably not. Should it? Yes, I think so because when insiders are allowed to game the system for their own advantage, which has become the American Way of Doing Business these days, the entire system is put at risk. Maybe you haven't noticed but the entire system is not working well, precisely because there are too many Scott McNeallys running around loose in corporate boardrooms with limited or no supervision.
If I run a red light or make a mistake I should be expected to pay a fine. The same should be equally true of corporate executives, who destroy entire companies, communities, even nations, with malfeasance and incompetence. Otherwise, what you are advocating that its perfectly OK for corporate execs, who are driving huge semi-trucks to ignore the red lights. That shouldn't make you feel smug and secure when you enter an public intersection to make a transaction.
It's all there, black and white, clear as crystal: you invested in a failing institution, that cratered completely. Stockholders are reimbursed after creditors, but if they could even pay their creditors they wouldn't have gone under. You get *NOTHING*! You lose! Good DAY, sir!
A typical liberal screed with little bearing in reality "a company that ceased to exist" is BS. Then again, I work for Oracle, and i think we probably got our money's worth in Sun IP. All the bits of Sun that are out there will continue to my knowledge, so it still exists, it just has a new name.
On the other half is something like the Free Republic, where there's a lot of crazy, some level-headed people trying to beat the crazy, etc. People with extreme viewpoints are loud (their views, after all, are extreme.) They can drown out a quiet centrist majority. Regrettably, the parties have to pander to the loud extremists because they produce the echo chamber through which the centrists hear their news.
Just my thoughts on the matter. 2012 sure will be fun though if the tea-party Republicans continue to dictate terms in the GOP.
You can't be serious. OK, maybe you are serious, but in that case you're missing a whole lot.
Your typical employee stock grant vests after four years at a fixed strike price, which is generally set at some price the stock reached at some arbitrary point previous to the start of those four years, generally around when the board decided on the employee stock plan. So, the employee is actually being granted a sort of stock future. If the stock goes up, the option has some value. If the stock goes down and stays there, the option is never exercised. So, the non-employee and management stockholders only get diluted when the stock goes up (in which case they make money anyway). And the company takes on its balance sheet not the current price of the stock at the time the option is exercised, but the strike price set in the option grant, which is of course less. The funds gained by the employee come from the sale of the stock to the public at the time the option is exercised. not from the company.
Bruce Perens.
> I didn't bother to read it
You couldn't possibly get through it. It goes on and on and on.
You are a sick fuck.
That "90+yo" man ran a party that was pretty much a neo-Nazi movement. And it wasn't in the 50s and 60s--it was in 1948, just a few years after so many Americans had lost their lives fighting exactly those ideals that this guy represented.
Again, fuck you. It's assholes like you that really hate America and everything it stands for.
These execs aren't being paid because they failed. Their failures are now irrelevant, because they're leaving and the company is being changed by the new owner.
They're being paid to leave. They have contracts and other leverage that could do damage to the new company if they didn't leave quietly. It's cheaper to pay them to leave than to let them stay, to fight them, or to let them do whatever they can do with their access or knowledge of the inner workings and the people who do stay.
This is also the reason the bankers who crashed the economy are getting paid, though their failures were epic.
You don't get paid for your work. You get paid for what it costs to get rid of you or to keep you, depending on what you do in return for getting paid.
--
make install -not war
Jonathan made it clear well over a year before the Oracle offer was on the table that they were trying to find a buyer.
Sun had, at one recent point, enough CASH RESERVES to take the company private again, and stayed public, aggressively driving the stock price lower and lower.
This is a big success for the executives--they crushed Sun, forced an acquisition, and got richer. That was their goal, they succeeded, and should therefore get their money!
So it goes.
"People who do stupid things with hazardous materials often die." -- Jim Davidson on alt.folklore.urban
Yeah, blame the "suffering of the employees" on the people that gave them all a f*ckin job.
Stupid drones...
I'm glad Ellison's rolling in cash.
His former worker bees probably had a case of the mondays
There's actually a lot more to it than this... plenty of conspiracy around whether or not WMB was actually about to fail or not. The administration at the time had put rules in place to keep bank stocks from being shorted. Turns out WMI and Indymac were not on that list... and guess which two failed? Any wonder that the only two banks that weren't protected failed? And why weren't they protected? Couldn't possibly be a slurping of cash from west coast to east coast? Anyone curious how it is that two of the west coast's largest banks managed to get handed over to east coast banks for pennies on the dollar? Did you know that WMI was shopping out WMB prior to the seizure, and couldn't figure out why no one was interested...? Turns out the FDIC had already gone to all the suitors and told them a seizure was in the works. Small wonder no one wanted to buy at market value, knowing they could get it for pennies on the dollar from their FDIC buddies. The FDIC directly and intentionally caused a huge loss in value to WMI shareholders. I highly recommend some googling, specifically look into the lawsuit brought by WMI's shareholders against Chase and the federal gov't.
Most construction workers don't work very hard.
>1/4 drunks, >1/4 tweekers, >1/4 stoners, >1/4 holy rollers. Lot's of overlap, some are fucked up on booze, tweak, pot and Jesus at the same time. Ever hear the phrase 'it doesn't take eight hours to do eight hours work'?
Mathematicians? Lords or their own little world. Hardly bastions of _generally useful_ knowledge.
Don't even get me started on 'artists' these days. Not having to sell their art has ruined it. Damn the federal government for funding such BS.
Not that generally CEO's are worth shit but your counter examples suck.
McNealy on the other hand was not just a CEO who got the job from a board. He got the job by building the company from the ground up over decades.
John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
Full disclosure: I'm a CPA working for a public accounting firm assigned to a Fortune 500 client.
If this wasn't the middle of February, I'd probably write some long diatribe. But I'm in the middle of busy season, and 16-hour days are the norm. So, in light of my desire to sleep, here's the other side of the coin. The folks you read about on the news are the exception to the rule - typically making poor judgement decisions with inadequate board support. Most C-level folks that I've met over the course of my career are extraordinarily bright and have a full understanding that their job entails great responsibility. When you have thousands of people who are reliant on your ability to bring home the bacon day in and day out, you tend to gain a new perspective on things.
I'm not going to try and sway your opinion here on whether or not the compensation is excessive - that's entirely a judgement call on behalf of the folks crying out that it's "evil". I will say that more thought than you can imagine goes into most executive plans, and it is done with a bevy of statistical support, generally leaning heavily toward company-performance-based compensation (as in, if you don't perform, you're not getting paid.) I can say from my time in public accounting, that I can see where the compensation comes from - there is a hell of a price tag to get to the position where most CEOs are. Personally, no matter of compensation is worth the 100-hour weeks and unlimited liability (read:SOX) that goes along with the job.
I doubt that many of you will agree with my stance on the topic, and I'd be willing to bet that I'll be called out on it. But after having seen just exactly what the job entails, I can honestly say that, to me, the only way I'd be willing to do that job is if I was paid accordingly.
Yes. I stopped posting on dKos after I had the misfortune of posting a diary next to another diary that was very similar except that it had the word 'penis' in the title. Naturally most people checked that one out first, and though I perhaps not so humbly believe that my diary was more thoughtful and nuanced, the penis titled diary rocketed to the rec list, after which there was no point in discussing that point in mine.
I should have known after the shellacking I got for saying that the whole Carrie Prejean business was blown out of proportion. There's nothing like being accused of promoting violence against women for having an opinion about free speech.
I've often thought I'd be more at home at a site dominated by thoughtful and civil persons of both liberal and conservative persuasion. Unfortunately "thoughtful" and "civil" don't get much support on either end of the political spectrum, although the left does pay lip service to them.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
"many IT budgets just couldn't justify paying the extra cash for the few extras Sun brought to the equation." The x4??? boxes talk to the serial console right out of the box, and it can be used to configured IP on the service processor network and jumpstart the OS -- no need to keep a stupid VGA monitor and keyboard around, no need to try to talk non-English speaking local hands through configuration. I've yet to see x86 boxes from any other vendor for which this is true -- it sure ain't of HP's boxes.
OK you've named one valuable feature, but is it really worth the added expense we are talking about here?
From hell's heart I fstab at /dev/hdc
Um, yeah. Compared to the cost and hassle of having to get a keyboard and monitor for a couple dozen facilities around the world, and trying to talk someone on the other side of the planet through connecting it and installing the OS? In the middle of the night our time, because they're only available local business hours? Not being able to investigate problems or watch a box reboot, because there's no console connection? Yeah, that's pretty valuable -- and I'm not convinced that, say, an x4200m2 is more expensive than whatever HP would call comparable. The Sun box is physically a dream to deal with in comparison. I demo'd an HP DL360 or such -- the lid over the back half of the chassis is attached to PCI risers, so one has to forcibly yank them from the mobo slots / jam them in to add/replace mem/cards. It's insane.
I appreciate the clarification, but doesn't any of this sound like "shell game" to you?
The CB App. What's your 20?