Monday, October 27, 2008

Executive Experience?

A lot has been written and said on TV about executive experience and how it might relate to the work of a president in the White House. Well, George W. Bush and Dick Cheney both had executive experience before they became President and Vice President of these United States and it did not, in my opinion, help them do a very good job. Also the heads of Merrill Lynch, Bear Stearns, Lehman Brothers and AIG all had executive experience too, and we know what kind of a job they did for their respective companies. So, my question is: What is so great about executive experience, if it is just time spent at a desk with no thinking taking place? Which reminds me of a line from one of Saul Bellows' novels in which he described the mind of the mother of his girl friend as working like a sewing machine, the needle going up and down, but no stitching taking place. In this presidential election we have four people with little if any executive experience. Yes, I know Sarah Palin is the Governor of Alaska, and that is executive experience. But here the United States has an opportunity to pick a president and a vice president with an education and intelligence. The people will have to decide who those two people are and what ticket they are running on. I figured that out a while ago, and I voted. I hope Americans will go to the polls and vote too.

The Sunday New York Times had a nice little article in the Sunday Business section of the paper about the three heads of the three major rating agencies, spell that companies, giving testimony before the House Committee last week. I am still waiting for someone at a higher pay grade than mine, remember I am retired, to say that the responsibility for the rating of fixed-income assets, such as notes and bonds, belongs with the Federal Government. The private sector can not do this important work any more than the players in the NFL can officiate the games in which they are playing. When someone at that higher pay grade comes to that conclusion, perhaps the markets will free up like a drain does after it receives a bottle of DRANO.

Stay tuned.


LceeL said...

YES!! Free up those markets. DRANO them puppies. Do SOMETHING, anyway. Something. Please??

Robert said...

Sometimes government agencies and private companies worry about brain drain. Executive talent leaving for higher paying jobs in other companies.

Salaries leapfrog up as employers bid against one another for so called "top talent."

Well, maybe the assumptions behind the brain drain theory are incorrect. Is it really the best talent at the top of our corporations? Or, on the other hand, are corporations and agencies more likely governed by the Peter Principle?

Peter Principle being a hierarchy of employees rising to their level of incompetence.

Companies and governments can save lots of money if they are not so bound by the assumption that top dollar always equals top talent.

moneythoughts said...

Robert, I have worked for a number of banks and a few brokerage companies over the years, and I don't think talent or brains has a lot to do with it. It is more to the order of an "old boy" network. That is why, I think, people fight so hard to get into Ivy league schools. Contacts and class is, in my opinion, what so much of it is all about. I have met people at the top of corporations, and I have met the founders of companies. The founders, without a doubt, are more talented than the CEOs I have met.

winslow said...

I've worked at companies managed by their founder and at companies with MBA CEO's. The entrepreneurial founder was always a much harder worker. The MBA CEO's enjoyed the social aspects and rewards (golf, connections, power, bonuses). I was always amazed at some of the decisions the CEO's would make concerning our department. I remember one meeting where the CEO said we had to start thinking out-of-the-box and then described the box we had to everyone told the CEO what he wanted to hear. The majority of CEO's today have no skin in the game. It's not a lifetime vocation. If things fall apart, they'll just move on. And you are soooooo right about the old boy network. That describes almost every board room. What about the doctrine of watching out for the shareholders interest (the owners of the company...that certianly sounded good when I first started investing).

Unfortunately, we have a quite a different problem in government. Here we have lifetime CEO's that have no intention of moving on, no matter how poorly the company performs (the perks for not working are just too good).
I remember when our state senator ran for his first term.......on the plaform of one term. Of course, after one term, he had to "inform" the public that the senate is much too complicated to finish business in 4 yrs, so he decided to run again...and again.

I see so many atrocious things today. I want a leader to stand up and say NO MORE!

moneythoughts said...

Winslow, thanks for your comments. Excellent! Good to hear from you again. Your comments are so on target.