lec11

lec11 - Why corporate scandals? National belief in...

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1 Why corporate scandals? • National belief in capitalism • Value pursuit of personal wealth • Oppose public constraints on capitalism • Expect corporations to self-police New view of corporations developed in 1980s • In 1970s, US was “falling behind” foreign competitors • Profitability as main goal • In 1980s, focus on stock price • Reagan “revolution” eliminated government oversight Why such high CEO pay packages? • In 2008, CEO pay was 433 times average worker pay • In 2003, CEO pay was 300 times more • From 1990 to 2003 – CEO pay rose 313% – Corporate profits rose 128% – Average worker pay rose 49% – Inflation rose 41% Boeing as an example of economic pressures • Commercial airlines losing market share • Consolidation of defense industry • Need for defense revenues to support business
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2 Boeing 767 tanker deal driven by politics and economic pressure • AF to lease 100 tankers -- but did not need new tankers • Boeing needed 767 tankers for
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lec11 - Why corporate scandals? National belief in...

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