Wages of Wagoner
Friday, February 3, 2006
New York Times
February 1, 2006
As General Motors slashes jobs, closes plants and battles to avoid
bankruptcy, the company's CEO has set up a retirement plan that will pay
him at least $4.6 million a year - nearly twice his current salary.
G. Richard Wagoner, who the New York Post calls "the greediest, most
undeserving CEO since Chainsaw Al Dunlap," was named GM's chief financial
officer in 1992, when the company had a global payroll of 750,000
Under Wagoner's command as CFO and, since 2000, CEO, the carmaker has seen
its employees dwindle to 324,000.
Now the company has announced plans to cut 30,000 more jobs and close 12
North American plants, and Wagoner is denying rampant rumors that GM is
preparing for file for bankruptcy protection.
The carmaker's pension fund is under-funded by more than $45 billion,
according to the Post. But Wagoner has nothing to worry about. He has a
Supplemental Executive Retirement Plan, which allows a company to use
after-tax dollars "that rightly belong to shareholders to shower riches on
the CEO instead," the Post reports.
Best of all for Wagoner, this payout comes from funds that are separate
from those underpinning the retirement programs of ordinary workers, which
means he'll pocket his $4.6 million-plus a year even if GM files for
News of the CEO's big pension payday comes after Delphi Corp., GM's
parts supplier, collapsed, jeopardizing the pension fund set up for the
company's 30,000 workers.
But the company's CEO J.T. Battenberg, like Wagoner, won't face financial
hardship after he departs the firm - he walks away with a $1.6
million-a-year retirement package.