THE ANATOMY OF A WELL FORMED PLAN

The following is a fictional scenario that might well have taken place sometime ago in our recent past…The names have not been changed in order to identify the culprits!

August 21, 2007...one year ago

Doug Steenland calling Richard Anderson: Congratulations on your landing the CEO post at Delta, jeez! My friend, how the hell did you pull it off? I thought for sure that Grinstein’s protégé, Jim Whitehurst, was a shoe-in for the job.

Richard Anderson: That snot nosed kid? He didn’t have a prayer! We blind-sided both of them; they didn’t see it coming. Man, what a couple of rookies. You would think that a 74 year old man would have smelled out our moves. Anyway Doug, our plan is still in play; we both declared bankruptcy the same day, we were able to shed millions of dollars off the backs of our employees by making them work for less. We both walked away from debt through the magic of the generous bankruptcy laws and you guys at Northwest, even though you have unions, were able to force lousy contracts onto your rank and file during bankruptcy. Too bad they were able to keep some of that stuff, but don’t worry, we’ll take the rest from them some day.

DS: I’ve got to hand it to you ‘Tricky Dick’, when you first hatched this cockamamie scheme all those years ago when we worked together at Northwest, I thought you and Gary Wilson had been smoking something funny again, and you know how you get with that stuff! I would have never thought we could actually arrive at a point where we could potentially put these two airlines together and do it with minimal union interference. How long should we wait until we declare a merger? You know there is going to be all kinds of speculation about what we are scheming to do?

RA: Cool your jets ‘Stingy Stee’; we don’t want to spook anyone. Let’s just let the rumors run up the value of our stock for awhile and deny everything; that ought to build some excitement and momentum for a big equity payoff like we got after we both exited bankruptcy. Man, what a brilliant plan; we got to collect equity when we individually left bankruptcy — then after we merge, we’ll have a second big score. This corporate life is a breeze if you play your cards right.

DS: You’re the Man, Dick! But aren’t you worried about the Justice Department or Congress? What if they find out what we’re up to? You know, all those nasty anti-trust laws and congressional hearings that the whiney unions will demand. How about the pilots? Won’t they scream bloody murder and demand stuff like their pensions returned and pay restored? It could get complicated.

RA: Good Lord! Hold yourself together, oh 'balls of steel'. We’ll give the pilots what they want and take it out of the pockets of all the other workers like we always do. That’s how Delta has always done it. As far as Congress and the Justice Department are concerned, we really don’t have much to worry about there; hell they are in more trouble than we could ever dream up on our own. There is an election coming up and lawyers at Justice all got their law degrees off the backs of cracker-jack boxes! Ha! Ha! Ha!

DS: This really could work, Dickie Boy! But, aren’t you worried about the other unions at Northwest; they aren’t going to take this lying down. Don’t they just have to talk enough Delta employees into signing union authorization cards and win a majority, combined vote? That shouldn’t be too tough for them. The flight attendants and ramp at Delta have been active since 2006, organizing and could present a problem.

RA: That’s in the bag oh worried one! We got friends at the National Mediation Board who are willing to throw a monkey wrench into that mix. Watch and be awed by the man who cut his teeth in this business learning from the beast of the airline world, Frank Lorenzo. Boy did he know how to increase personal wealth through the destruction of tens of thousands of workers’ lives. What a master! Anyway, I digress. There will never be a vote as long as this mediation board stays in place. They do our bidding and will fix the process for us.

DS: Looks like you have everything covered. Now if we could just do something about ALPA and the pilots.

RA: Working on that now oh lackey of mine! You know the Air Force is making great strides with pilotless drones…

DS: I wish I was you.


Today is the one year anniversary of Richard Anderson becoming CEO of Delta Air Lines. Congratulations Richard, we are watching you closely!