Corruption in America:
Northwest Air Execs Sell Out Their Stock,
In Preparation for Bankruptcy, Strikes
Aug. 13, 2005 (EIRNS)The bankruptcies of both Northwest and Delta Airlines are expected within the next six weeks as the deregulated sector continues to collapse. In the case of Northwest, blatant executive greed and corruption "Enron-style," is hastening the end.
Northwest executives were quoted by wire services on Aug. 12, openly favoring banrkupting the airline before the end of September, when the 2005 "bankruptcy reform" law goes into effect, because that law might be an obstacle to continuing their own multimillion-dollar pensions, while ending the pensions of their employees. President and CEO Douglas Steenland's annual pension contribution from the company is $947,417, equivalent to the contributions made for 90 flight attendants.
Northwest management has actively provoked a strikeprobably to start this week with the airline's mechanicsby demanding $2 billion in salary cuts and refusing Federal arbitration; it has prepared the hiring of 3,000 replacement mechanics and flight attendants at its preferred lower wage-scale.
Simultaneously, though, the five top NWA executives have all been pulling "the Ken Lay trick," quietly unloading a total of about $42 million in shares of Northwest stock. CEO Douglas Steenland has sold $5 million worth since May. Chairman Gary Wilson has dumped $17 million worth; former Chairman Al Checchi, $26 million.
"By any measure, our overall total labor costs are too high," said Steenland, regarding the looming of bankruptcy.
Steenland's cash compensation for 2004 included a $472,649 salary, $71,040 in other short-term compensation, $3,108,575 more in stock, and a $769,216 "incentive payout," for a total of $4,421,480. The "incentive" was evidently to provoke employee strikes, reach bankruptcy before Oct. 1, or both.