GM CEO Rick Wagoner to Resign: It's About Time

by Deb Cupples |  After urging from Obama Administration officials, General Motors CEO Rick Wagoner is reportedly planning to resign (or has resigned) after decades with the company.

As a GM shareholder (albeit an amoeba-sized one) I say Good!  Mr. Wagoner has taken truckloads of shareholder dollars over the years, despite years of GM's facing a very iffy future -- money that could have been spent saving jobs, increasing productivity, paying down debts, offsetting losses.... 

Let's look at Mr. Wagoner's compensation packages over the past five years.

Table 1: Mr. Wagoner's Compensation

Year	Pay, Bonuses, Stocks, etc.*
2008	$14.9 million
2007	$14.4 million
2006	$10.1 million
2005	$  8.5 million
2004	$  7.1 million
Total only for those years	$ 55 million

* Note: some of Mr. Wagoner's compensation came in the form of stock grants or options; thus, the current value of his past compensation might be lower, given that GM stock prices are pretty low now.  That may change over time, however, given that GM has received billions in government aid (i.e., welfare).

That's right: based on the values when he received his compensation, Mr. Wagoner took $55 million in shareholder money -- and that's just for the five years listed in Table 1.  

What sort of losses did GM report during that five-year period?

Table 2.  Years of Loss for GM

Year	Approx. Amount of Reported Losses
2008	$30    billion
2007	$38    billion
2006	$1.9   billion
2005	$10.4 billion
Total Approx Losses for 2005-08	$80.3 billion

In all fairness, GM did report profits of $2.7 billion for 2004 (after restatement). 

If we use that figure to offset GM's total losses for 2005-08 (as listed in the table), then under Mr. Wagoner's leadership during the five years beginning in 2004 the total company losses were "only" $77.6 billion.

For this, Mr. Wagoner was paid $55 million (an average of $11 million per year)?

Yes, something is definitely wrong with a business that pays its "leaders" enormous sums despite enormous losses.  Other shareholders should be up in arms.

I'd like to see the Obama Administration encourage the resignation of high-level execs from other companies that received bailout funds -- that and a clawing back of bonuses for all levels of execs who took them during years of loss.

Memeorandum has commentary.

Other Buck Naked Politics Posts:

* Bank Execs Might Give Back TARP Money if Pay is Cut?

* Real Executive Bonuses Based on Fake Profits

* Save Jobs by Cutting Executive Pay

* Wall Street Execs Got Billions While Driving Economy Toward Cliff

* Two Execs Sentenced to 20+ Years for Fraud

* Miami Doctors Plead Guilty to $10 Million Medicare Fraud

* Executives Skate out of Economic Disaster with Millions

Comments

[rawdawgbuffalo]

now hold wall st to same standards and im good

[Deb]

Easter,

I see a line between useless dwelling on the past and accountability.

Under Wagoner, GM repeatedly made bad business decisions that put GM in the position it's in today. He -- personally -- extracted tens of millions of shareholder dollars in short-term gains as a result of his short-sighted decisions (i.e., looting shareholder wealth based for personal enrichment).

Now, thousands of workers -- not only at GM but at other businesses, say those who provide auto parts or services -- will likely suffer ripple effects if GM collapses.

And so will our nation's economy.

If we allow Mr. Wagoner to go off into the sunset without so much as some harsh criticism, how can we hold other company heads accountable for looting and misdeeds?

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