Wednesday, May 16, 2007

Creative destruction

The Boston Globe wonders about the sale of Chrysler Corporation to Cerberus Capital Management, and whether workers need a little "buffer" from globalization's "creative destruction."
The people who put together the Chrysler sale won't be worrying about their own pensions or healthcare. At their level of compensation, they are assured the best of both. And if Cerberus managers can turn around Chrysler, they'll deserve lucrative stock options and bonuses. There's enough wealth in this economy, however, that the people who make the cars, as well as though who make the deals, should be protected in illness and old age
In this morning's New York Times Michael Kinsley chronicles the ownership history of Avis to explain how much of modern business is really finance. Heaven forbid anyone who runs the place should know anything about renting cars.

Why make or rent cars when you can make money flipping the companies and employees who do?

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