As the one or two of you who read my blog know, Cameron is a 17-year flight attendant at Northwest Airlines. As such, we have endured a bit of hardship at the hands of Doug Steenland, CEO, NWA. While Northwest recently emerged from bankruptcy just days after AFA suspiciously ratified the third tentative agreement, Joe-Joe, dog-faced boy, accepted a $26.6 million bonus for running the once profitable, but now, struggling airline into bankruptcy. I suspect that his undeserved bonus would have gone a long way to keep the airline solvent.
Q: Why would the compensation board reward poor performance? A: cronyism.
His heart isn't the only thing that's ugly.
In light of all the bad press Northwest is getting due to cancellations, Cameron received a whining lament from Steenland in his e-mail. After reading it I thought, "boo-hoo, asshole. You've done the same thing to Northwest that Al Checchi did a few years ago. Now, suffer the consequences." This excerpt from a 1997 Time magazine article about Checchi's failed run for California governor illustrates exactly what he and Steenland have done with the help of the compensation boards that pay them, the corrupt union officials that they bribe and the bankruptcy judges with which they're in bed:
As Checchi knows, his years as co-chairman of Northwest are the ones his critics are most likely to use against him. When asked about his piloting of the airline, he gets a scowl on his face and pulls out two yellow, legal-size pages of scrunched-up notes to defend his record there from 1989 to 1993. Critics charge that he took the once profitable carrier, burdened by debt from the LBO, to the brink of bankruptcy. Checchi used his charisma to extract some $800 million in union concessions and an additional $837 million in state and local bonds, subsidies and tax credits--while earning $32 million in management and investment fees for his outside firm.
In his version, Checchi was the "white knight" who kept the company from being dismantled by asset strippers or from going down the tubes like Eastern Air Lines. He also gave Northwest employees stock that has tripled in value. "Look," he says, "we took one of the worst airlines in America and made it one of the most profitable." But Paul Omodt, spokesman for the Air Line Pilots Association for Northwest, says the LBO was "disastrous" for the employees, who ended up bailing out the company in return for stock and three directors' seats. As for the state's involvement, critics like Minneapolis' Federal Reserve Bank researcher Art Rolnick say what Checchi touts as a "partnership" of government and business was really a government subsidy in return for promises to build new facilities and create jobs. "The notion that he was a white knight is questionable," says Rolnick.
And, now, here is the letter from poor, little Douggie:
As everyone knows, we've had a painful week as we have had to cancel flights, inconvenience customers, and put an extra burden on all our co-workers. We are working hard to solve this problem and we all need to work as a team to make sure this never happens again.
It’s important that we understand the facts and the steps being taken to address the issue. When we first developed our 2007 business plan, we expected to increase capacity by 3.7 percent year-over-year compared to 2006. We planned this level of growth to secure jobs, take advantage of new opportunities created by our successful restructuring, and increase the profitability of the airline. In the spring of this year, recognizing that summer weather might be challenging and that this would be the first summer operating in our post restructuring environment, we took steps to ensure that we had adequate pilot staffing. Specifically, we pulled back on some of our planned growth to create additional pilot reserve hours for the summer months. In fact, we entered this summer with the highest level of pilot reserves in Northwest’s recent history.
Since October 2006, we have been retraining our furloughed pilots so that they can resume flying and we can grow our pilot staffing. Our training facilities have been full to capacity and we have offered every furloughed NWA pilot the opportunity to return to Northwest. In May, Northwest completed 99.1 percent of its scheduled flights which put us near the top of all network carriers in completion factor. This excellent level of operational performance suggested our plan for the summer was a sound one. Why then has NWA’s completion factor in June been so different from May? Several factors have contributed to the June results. Among the most important are:
- Weather: We had two major East Coast storms in early June and one in the Midwest that significantly affected our operations and caused us to use up many pilot hours. This week’s storms on the East Coast and Wednesday’s ground stops in Detroit further impacted our operations and reminded us just how disruptive bad weather can be during peak travel summer months. Our competitors were also affected. For example, yesterday, Delta cancelled 200 flights.
- Increasing Congestion: As many of you know, the East Coast is reaching the saturation point for aircraft operations. Even on good weather days, we are incurring delays into the large East Coast cities and this is getting worse by the month. These ATC delays also use up more pilot hours than expected.
Absenteeism: Pilot absenteeism increased by 80 percent in June 2007 versus June 2006 and by 40 percent in June 2007 versus May 2007. These absenteeism increases primarily involved a minority of NWA narrow-body pilots.
The cumulative effect of these factors caused the airline to have a shortage of pilots for the latter part of June. This left us no choice but to cancel flights so that we could get the airline back to normal. Some have suggested that if NWA had started retraining its furloughed pilots sooner the June problem could have been avoided. Using the perfect vision of 20 – 20 hindsight, that clearly would have helped. If our crystal ball had been perfect, we would have recalled pilots sooner and not expanded the airline as much in 2007. However, we entered the summer with reasonable expectations that the schedule would be operated reliably, for the following reasons:
- Pilot reserve hours for the summer months were at an all time high;
- The May 2007 operation realized a 99.1 percent completion factor; and
- The June 2007 completion factor would have been in line with that of prior months if pilot absenteeism had remained at the same level as June 2006. The June 2007 pilot staffing plan did not anticipate the increase in absenteeism over June, 2006. So what are we doing to address this issue? Here are some of the steps we are taking:
- Effective July 18, we will cancel our Detroit – Frankfurt second frequency which is flown with 757 aircraft, thereby creating additional pilot hours.
- In August we are further reducing the schedule by 90 flying hours per day (a reduction of about 3 percent of domestic mainline capacity) to create additional reserves and to reduce the monthly maximum hours that our pilots will be asked to fly that month.
- We are continuing our efforts to increase the number of NWA pilots. Our training facility will remain full. We will look to get all remaining furloughed pilots back to work and we will initiate new pilot hiring, if necessary.
- Recognizing that summer thunderstorms and ATC congestion are inevitable, starting in August, we will also modify the way that some of our pilot trips are scheduled, especially to and from the large East Coast cities, so that when bad weather and ATC delays do occur, the impact on the entire system can be minimized.
- We have also instituted some short-term solutions to mitigate cancellations. These include relaxed travel restrictions, efforts to ensure quick re-accommodation of our passengers, and multiple efforts to contact our customers about the cancellations.
The past week has been a very difficult time for NWA, especially for all of you who have been dealing directly with our customers, who are understandably frustrated. I am particularly grateful to our ground personnel, reservations agents, pilots and flight attendants who have been working hard every day during this challenging period. Thank you for your professionalism, hard work and commitment to meeting our customers’ needs.
Please be assured that we are taking every measure to resolve the problem and return Northwest to normal operations. To accomplish this, we all must continue the commitment we have shown during our 20 months of restructuring and remain focused on our shared goal of making Northwest one of the world’s most successful airlines.
M-kayyy... "co-worker?" Who the hell are we kidding? Steenland is the bully that stole other kids' lunch money in grade school. Besides, any CEO worth their salt would have anticipated this backlash from the pilots because the "coworkers" are tired of getting shafted so this bastard can take all the marbles. His initiatives are at best a Band-Aid. The fact is, he's changing work rules to further "punish" the pilots for not cooperating and laughing all the way to the bank.
That's OK, I guess. We'll cope. Someday, he'll be living in hell with "W," Prick Cheney, and BOBOB, Ann Coulter.