German billionaire buys $100M yacht after implementing pay cut for workers

[Epicurus8a]

A German billionaire, Reinhold Wuerth (#93 on the Forbes 2009 list), who has put his factory workers on short-time and cut their wages by faking a recession, has gone on to buy himself a $100 million yacht, which exemplifies the old phrase “The rich get richer and the poor get poorer.”


http://www.dailymail.co.uk/news/worldnews/article-1166163/What-recession--65m-yacht-Ge...nsion-pot.html

This guy is a soulless piece of crap. I'll bet one of his employees is busy plotting his death!

Edit: He doesn't look like a member of the Walton family......

[M Bruner]

With one foot in the grave, and the other on a banana peel. He probably thinks he's going you-know-where, he probably feels he should go there in style.

[MikkiKimmi]

evil little man

[gadgetguy]

Let me get this straight. He doesn't have enough customers buying screws to keep his production plants working at full capacity. Instead of laying people off, he's cut their hours and wages to keep them employed. In a separate action, he has employed countless workers in the Yacht building industry by purchasing one of their top of the line products and he will employ more workers to operate it.
How does this translate to being a bad guy?

[thecoalman]

Exactly Gadgetguy but some people just don't get it... He didn't get rich by making bad business decisions and having a bunch of employees sitting around doing nothing would certainly be a bad decision. The business goes broke in a year and he lays everyone off... Let's punish all these rich successful people so we can all be poor.

[M Bruner]

I'm okay with that.

[MikkiKimmi]

he just looks creepy

[bendixG15]

It's his money and he can spend it any way he wants.

Either buy himself a toy
or
Donate it to others.

He choose the toy.
Doesn't bother me, I don't want handouts.

[Epicurus8a]

To those of you supporting Wuerth's actions, I wonder how you feel about the A.I.G. Bonuses. If you think those were a good idea, please kill yourself now.

[gadgetguy]

My feelings are irrelevant. My thoughts on the subject are that negotiated contracts between employer and employee are none of my business unless I am one or the other.

[Supreme2k]

You can't really compare this guy to AIG. What they essentially want to do is pay unearned "bonuses" using taxpayer money.

Yes, they can do what they want with their money, but not with ours.

But the, we'd have to start straying into political territory to keep this thread going.

[Epicurus8a]

But the, we'd have to start straying into political territory to keep this thread going.

You may be correct about that. But as long as we avoid politics and only discuss business practices or philosophical ideals, there shouldn't be any problems.

[Supreme2k]

Yeah, but there's no getting around it. Taxpayer dollars = government intervention = political. When the POTUSA is addressing AIG directly, it's political now and not "just business".

[gadgetguy]

The bonus contracts were in place and the conditions of those contracts were agreed to by both parties. The employees bound by those contracts met their conditions and therefore earned their bonuses. Whether or not you agree with the conditions of the contract is immaterial, it was what the parties involved agreed to.
When a prospective new owner is looking to purchase an existing business, they review the books and any contracts that are in force. They also investigate for any debts or obligations that may exist, whether they are on the books or not. If they find anything they object to or find questionable, then they either walk away or see if the conditions can be changed (contracts renegotiated or debts reduced). If they can't come to an agreement, then the sale falls through. If they fail to do the investigation and make no effort to renegotiate any contracts or reduce any obligations, then the new owner accepts the responsibility to meet the existing conditions. Assuming there was no actual fraud on the part of the sellers, there's very little sympathy for the buyer if he doesn't like the conditions of any contract in force at the time of the sale.
Now let's say I was a silent partner to the buyer and I had left all of the details up to him. He did all of the investigations and reviews and I accepted his word that everything was managable. After the fact, I find out that the wage being paid to the accountant is three times the normal rate and that his contract would be in force for the next five years. This was clearly spelled out in the contract that my partner reviewed before the sale.
Do I direct my anger at the accountant, my idiot partner, or myself?

[thecoalman]

To those of you supporting Wuerth's actions, I wonder how you feel about the A.I.G. Bonuses.

Apples and oranges. The simple fact is someone that owned a business made a decision to keep it a viable business. Look at it this way... he doesn't want to cut hours or employees as that means he's making less money because of lower productivity. If the business was able to support those employees he most certainly would not be cutting their hours.

[Epicurus8a]

To those of you supporting Wuerth's actions, I wonder how you feel about the A.I.G. Bonuses.

Apples and oranges. The simple fact is someone that owned a business made a decision to keep it a viable business. Look at it this way... he doesn't want to cut hours or employees as that means he's making less money because of lower productivity. If the business was able to support those employees he most certainly would not be cutting their hours.

I never said "A = B." I said "If you like 'A,' and you like 'B,' then you should kill yourself." And I'll stand by those words, because the universe doesn't need this kind of thinking.

BTW, some of you may have missed this quote:

the convicted tax evader celebrated the christening of his new super yacht, the Vibrant Curiosity.

Also:

Executive pay is a hot issue in Germany at present with numerous executives - including the boss of Deutsche Bank - taking huge salary cuts in a bid to calm public anger.

Executive pay (and bonuses) is a hot topic in the USA, too. Cutting workers pay while giving oneself a bonus is despicable and should be outlawed everywhere.

[gadgetguy]

I never said "A = B." I said "If you like 'A,' and you like 'B,' then you should kill yourself." And I'll stand by those words, because the universe doesn't need this kind of thinking.

Thinking with business acumen is bad but advocating suicide is good?

BTW, some of you may have missed this quote:

the convicted tax evader celebrated the christening of his new super yacht, the Vibrant Curiosity.

I didn't miss it, I dismissed it as irrelevant and without substance. He's not in prison, so I can only assume that he has made amends to the German tax authority. But it has nothing to do with his business actions or the purchase of the yacht.

Also:

Executive pay is a hot issue in Germany at present with numerous executives - including the boss of Deutsche Bank - taking huge salary cuts in a bid to calm public anger.

Executive pay (and bonuses) is a hot topic in the USA, too. Cutting workers pay while giving oneself a bonus is despicable and should be outlawed everywhere.

It's not a hot topic with me. Executive compensation packages, bonuses, wages, etc. it's all just blowing smoke to disguise the real problem. I don't care what someone is willing to pay or what someone is willing to accept as payment, unless that someone (in either position) is me. I think everyone should be paid as much as they can get for whatever they do. Even you.

[Epicurus8a]

Of course I don't really advocate suicide. Mandatory sterilization would suffice. :P

I also think people deserve as much pay as they can get, within reasonable limits. What isn't acceptable is stabbing your brother in the back to get it. And that's what troubles (me and) the Germans about this guy - and others like him.[/u]

[gadgetguy]

On what are you basing the assumption that he stabbed anyone in the back? I didn't read anything in that article that says that.

[thecoalman]

What isn't acceptable is stabbing your brother in the back to get it.

Epicurus8, it's two separate issues. How much he makes and how it spends it is irrelevant to how he runs his business. A fundamental rule of running a successful business is personal and business finances are separate. If you wanted to say he should have given that money to charity or whatever so be it but as already pointed out the purchase of the yacht is going to keep a whole lot of other people employed.

Let me ask what do you suggest he do? On the business end if he keeps those people employed it will inevitably lead to bankrupting the company, possibly bankrupting himself and put a whole lot more people out of work. So what's your solution to his problem.

[Epicurus8a]

What isn't acceptable is stabbing your brother in the back to get it.

Epicurus8, it's two separate issues. How much he makes and how it spends it is irrelevant to how he runs his business. A fundamental rule of running a successful business is personal and business finances are separate. If you wanted to say he should have given that money to charity or whatever so be it but as already pointed out the purchase of the yacht is going to keep a whole lot of other people employed.

Let me ask what do you suggest he do? On the business end if he keeps those people employed it will inevitably lead to bankrupting the company, possibly bankrupting himself and put a whole lot more people out of work. So what's your solution to his problem.

Executive compensation has gotten completely out of whack. Instead of buying a yacht Wuerth should have given his employees bonuses for their loyalty. Then the employees would spread the money here and there (mostly in Mom & Pop shops, I suspect). That would do a lot more good than buying a yacht because most of the profits go to the ship building corporation - who no doubt have their own greedy overpaid execs.)

[bendixG15]

........... Wuerth should have given his employees bonuses ............

How much have you given to charities lately ?????

It really is the same thing.

[gadgetguy]

I also think people deserve as much pay as they can get.

Executive compensation has gotten completely out of whack.

[greymalkin]

"it's always good to umm..uhhhh...you know...spread the wealth around"

[Epicurus8a]

I also think people deserve as much pay as they can get.

Executive compensation has gotten completely out of whack.

Pardon me. I meant to say people deserve as much pay as they can get, within reasonable limits.* (I've edited my previous post to reflect this.) Unfortunately the uber-wealthy control everything. IMO, it's time for ordinary people to stop being complacent. Workers everywhere need to speak out and demand an end to this nonsense.

*How about a maximim wage cap on all jobs - like they have for sports teams.

[gadgetguy]

I see, so who gets to decide what the reasonable limit is?

[lordsmurf]

If you think those were a good idea, please kill yourself now.

Yep.

[Epicurus8a]

I see, so who gets to decide what the reasonable limit is?

That's a very good question. We'll need to brainstorm to come up with an acceptable answer. IMO, no one class of persons should have the authority to decide - because they would have their own interests at heart. (As exemplified on Wall St.)


-------------

BTW, I'm obviously not an economist nor do I have a political agenda. I am, however, concerned about Economic Inequality. http://en.wikipedia.org/wiki/Economic_inequality (Link may have political references.)


----------

If you think those were a good idea, please kill yourself now.

Yep.

I thought you'd like that!


-------------

Please note: I'll be away for a few days and unable to respond. So have at it!

[gadgetguy]

We? I have no interest in setting limits on anyone's earning potential.

[thecoalman]

OK, so I go out an build a company from the ground up, I'm overwhelmingly successful and in ten years I'm making enough money that I can pay myself and staff this limit set by regulation. What's my incentive or their incentive to take the company to the next level? There is none... That's where setting limits breaks the capitalistic model. Once you take the incentive away very few people are going to seize the opportunity to go to the next level.

Communism and Socialism looks great on paper and if it worked the way it's supposed to everyone could be happy and we'd be living in a Utopia. The world doesn't work that way as has been proven many times in the past. Let's take the present situation in Venezuela a country where socialism has flourished over the last decade because of high oil prices. However there is no incentive to take it to the next level, instead of taking risks, diversification and investment in the future that would inevitably happened had it been a capitalistic society the money they made was squandered on social programs some of which even benefited people here in the U.S. Now that oil has bottomed out:

http://www.newsobserver.com/1573/story/1470702.html

Inflation is already at 31 percent, by far the highest in Latin America, and food prices rose by 50 percent last year. Venezuela's economy, which grew by 4.2 percent in 2008, is projected to drop by 3 percent in 2009 and by 5.4 percent in 2010, according to the Economist Intelligence Unit.

Once the oil is gone they are really going to be screwed.