By Maxine Shapiro, KERA 90.1 business commentator
Dallas, TX – It's Friday so "It's Only Money," a review of the big and not-so-big stories of the week. I'm Maxine Shapiro with KERA Marketplace Midday.
Could it have been a more tumultuous week for American Airlines? We knew there would be turbulence ahead after the revelation executives at AMR cut themselves a sweet deal while the already anxious and humbled labor unions agreed to make more concessions. Then we find out the AMR board was led to believe that Don Carty had told the unions about the executive compensation package before the unions voted on their concessions. Sure. Was the board nuts? I'm a member of one of the unions and you tell me members of management will cover their you-know-what if things get any worse? And then ask me to make my future even more tentative then it already is, and I go ahead and vote yes to that?! Sorry, board, but you better come back to earth pretty quickly.
Well, they did, and Carty's out. I will save my words about the new executive chairman Edward Brennan for a later date. But now for the true acid test: Carty's severance package - how much and how big? No one should expect the changing of the guard to be much more than that. The issues and problems that plague American are the same throughout the airline industry. There is no short-term fix, but maybe now AMR can focus on a future. For a while it looked like they had none.
In other news, the Gross Domestic Product, or GDP - the broadest measure of the U.S. economy - grew at snail pace last quarter. Economists knew expansion was going to be slow. They predicted it would be up a slight 2.2%. And were they disappointed. It only grew at 1.6%, just a tad better than the last quarter of 2002. In trying to keep a happy face, one economist told CNN/Money, "Positive growth is still positive growth." No argument there.
And how about those wild and crazy people at the U.S. Treasury? First, they add subtle pastel colors to our bills, force us to check our quarters before we use them and now, after 65 years, the nickel is getting a new design. You go, Treasury Department! For KERA Marketplace Midday, I'm Maxine Shapiro.
Marketplace Midday Reports air on KERA 90.1 Monday - Friday at 1:04 p.m.
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