Boeing is becoming a national embarrassment. We discuss this ad nauseam every time a post about them makes it to the front page. I think this is a sign that their reputation is beginning to be worth less, and more people in the system are going to be more critical. This one case won't penalize Boeing enough that they return to a more quality focused culture. Maybe there aren't enough legal penalties to do so. I wish I could see a feasible path to Boeing redemption.
1. Imprison executives who made the decisions that led to the result. Preferably in a way that makes them spend their fortunes on legal costs so that when they get out in 20-30 years, they're dependent on social safety nets for the rest of their natural lives. People are dead because they thought that possibility of profit was worth the risk of hundreds of deaths. That's negligent homicide.
I don't think making an example out of those executives are going to do anything in particular. Stripping them out of their position and banning them from holding executive positions will. Forcing Boeing to reorganize their structural incentive will. Forcing shareholders to take a haircut means that they will likely hold the board more accountable will.
Like, nobody really think about risking people's lives for slightly more profit. It's more like they think about "cutting cost to get promotion and make more money. What risk? There's no risk.".
It's not like Boeing are particularly competent. Their projects experienced cost overrun for example. This whole idea of outsourcing to individual contractors turned out to make development of aircraft even more expensive. Their space division is currently blowing another hole in their budget. Their Starliner program is a joke and has no future beyond the ISS.
Some people may need to go to jail because it's more than just gross incompetence, fair enough. I am just skeptical of long lengthy sentences.
The idea that severe punishment for executive failure will lead to improved executive decision making I don't think bears out.
When dictators publicly executed advisor 1 and then advisor 2 and then advisor 3, they would still manage to always find someone greedy/desperate enough to want to take a crack on chance #4 or #5. But it did nothing to make the advisors better, it just meant that the next guy had to be even more greedy or desperate.
Responsibility will turn out to be so diffuse that no individuals will be found to be liable. This is a superpower of large organizations and permeates our daily lives. Also one of the main reasons government regulation is always required. And why capatilist bros are constantly wittering about removing regulation.
As harsh as this sounds, it also seems to have other benefits. Often when things go wrong the solution the government comes up with is "micromanage the industry more", and the industry becomes yet more bureaucratic and compliance focused. Innovation is harder because the people making the rules aren't necessarily the domain experts.
I think an accountability approach lets engineers build for safety leveraging their expert knowledge, in contrast to a rule based approach which favors compliance and bureaucracy. Accountability will select for leaders with an understanding of good engineering and safety culture, rather than leaders who are good at bureaucracy and compliance.
I worked in the financial sector for a bit, where some leaders have personal accountability (eg chief compliance officer). I've seen questionable projects die because the company couldn't find someone to stay in that accountability role. The financial sector is not necessarily a good example of what I'm talking about generally, but in my particular experiences accountability seemed to work.
> People are dead because they thought that possibility of profit was worth the risk of hundreds of deaths
Probably untrue, to the point that Boeing may prefer the government do this instead of pursuing the company as a whole. The problem was nobody was connecting the cost cutting to outcomes.
Trying them for negligent manslaughter or homicide seems extreme, but I'd entertain an attempt at justifying that, and I'd do so in good faith and with an open mind to the arguments presented.
Just to be clear though, are you proposing that they should have these charges brought up against them and given the same rights to due process that everyone else gets, are you proposing something more akin to extrajudicial detention - a suspension of due process and the suspension of habeas corpus?
Why stop with the executives? Why not throw the shareholders into jail --- they approve the selection of the executives and benefit from whatever malfeasance you are targeting.
You can change the leadership to someone who is amenable to a quick concession as opposed to a drawn out legal fight. But can you destroy the desire for profit?
> 1. Imprison executives who made the decisions that led to the result.
I'd go a step further. Follow the Truong My Lan case [1] - make these people actually fear getting executed.
I'm not a fan of the death penalty at all. It is disproportionately affecting the poor and otherwise disadvantaged. But for ultra rich people making money off of risking the death of others? Maybe that is what is needed to get rabid capitalism under control.
If the government keeps going on with not actually doing anything to the ultra rich until they steal from other ultra rich (SBF, Madoff), eventually people will take the law into their own hands otherwise. This United Health CEO will not have been the last, but "citizen justice" is not what anyone should want.
This country has been an oligopoly since its founding and apart from a few edge cases (FDR preventing the complete transition to socialism by placating the masses with the New Deal) the working class have never really had power.
it will never happen. these company executives are major donors to politicians of both aisles. laws and regulations are for the common people like you and me. not for the ultra-rich. heck, even the judiciary is corrupt these days.
Boeing should be put under financial oversight by the US government, the same way GM was in 2008.
It's apparent that the FAA's oversight powers are not strong enough to to overcome the financial pressures of management on their own.
For what it's worth, I work for a smaller aircraft manufacturer right now. Aerospace will always be a day late and a dollar short when profit is the focus instead of safety and sound design.
Was GM under financial oversight? I thought the US government financed and oversaw what was essentially a bankruptcy proceeding, with the loss-making and highly leveraged assets spun off and the rest consolidated in a 'new' GM. (or something like that)
How would that work exactly? GM was in bankruptcy proceedings but Boeing is still a going concern. The federal government generally doesn't have statutory authority to impose financial oversight on companies.
Most of the times the US is "involved" (by varying degrees) has involved serious financial issues / bankruptcy / some government agency's legitimate and legal involvement.
I don't know of any situation where "Boeing you're still solvent but we think you're being stupids." would be legal, or even desirable.
There's at least three problems with this laissez-faire ideal:
1) For some reason that is hard to understand, the prospect of Boeing's long-term decline does not necessarily translate into incentives for the people at the helm to steer it right. They can reap unfathomable rewards while guiding it to its doom. That's not only perverse and unjust, it's also bad for incentivizing success. This is not necessarily something specific to Boeing; any company is vulnerable to this disease.
2) It may be a contagious condition. When executives who ruined Boeing leave the company, they may take up influential positions at other companies, and have similar destructive effects. It's hard to understand how this can happen, but it's the sort of thing that does happen; that is a major problem that deserves to be solved.
3) A Darwinian process of creative destruction is fine if Boeing were sinking because it was improving but too slowly, and Airbus had improved even more and faster and surpassed it. If Canon replaces Kodak, life goes on and we get nice cameras. But in a case where Boeing dies not by being outgrown but by regressing, because 2024-Boeing has worse quality standards than 1994-Boeing, there's nothing fine about that; that's something that should concern anybody who cares about the production of high-quality airplanes. It's worth examining how we got here, and if an incentive disconnect at the executive level is responsible then there could be very valuable lessons to learn about corporate governance going forward.
i'm no expert on this but i thought the military buys a bunch of stuff from them because there's no other choice, right? and all those airlines, their only other choice is airbus.
Boeing's decisions were ultimately not a matter of the dubious leaders or the MD acquisition. They were a matter of the preferences of the owners, which is to say they expressed the preferences of Wall Street investors and the preferences are "provide a steady stream of revenues by cutting costs and gutting the company if necessary (subcontract nearly everything out, make the workforce disposable, etc)". You can see this in the decision of California's PG&E to give the money needed to maintain lines to their shareholder as a dividend. Overall, the process dispossesses the employees and mortgages the future of the enterprise.
To change this, you'd have to have a different source of funding for these enterprises at the least.
Perhaps we need to rethink protecting shareholders from liability. I'm sure that would be unpopular, but having companies create harm for profit is a problem.
Make them move their headquarters back to Washington or North Carolina, so the team has to be around the engineering staff instead of insulated from them.
After the MD merger everyone knew it was bullshit they were moving to Chicago. The move to the DC area is equally bullshit.
>O’Connor said the settlement’s provisions for choosing an independent monitor improperly required considering the race of the person appointed and minimized his role in the process.
How did considering the race of the person appointed even come up?
I can't imagine either side thinking there was some kind of advantage to doing so?
According to the NPR article about this: "The judge also objected to a requirement that the monitor selection process adhere to the DOJ's diversity and inclusion policy."
So it seems as if the judge doesn't like something the DOJ routinely has, because the judge is saying the court should have a large part in deciding who the overseers are.
The judge brought up DEI. Neither of the parties seem to have, besides what seems to be a standing policy.
https://www.npr.org/2024/12/05/nx-s1-5217960/court-rejects-b...
I agree with you, it would be very odd (even as someone who is generally pro DEI) to include it in this provision.
Yeah I don't see a reason that just because the DOJ is a part of a legal deal ... somehow their department policies should be injected. Could have some very negative outcomes and strangeness about what kind of deal DOJ can even make if a department policy gets injected that counteracts something in the deal.
> Reed Charles O'Connor (born June 1, 1965) is a United States district judge of the United States District Court for the Northern District of Texas. He was nominated by President George W. Bush in 2007
Yeah, makes sense that he would interpret a reference to DEI as discriminatory. Maybe he wants to get noticed by the incoming administration for appointment to a higher court?
I can think of one reason, and it is that Boeing was accused of loosening hiring requirements because of their DEI policies. I do not believe this is the case for this ruling, and there is no evidence that Boeing changed hiring or training standards due to DEI policies.
The Biden admin has been putting in DEI requirements on a number of legal settlements and contracts. For example, largs delays in CHIPs act rollout and EV charging station rollouts were caused by this. This is not routine, but extremely unusual and likely violates the US Constitution.
Yeah. Both parties have become very used to backdooring things that can't come in through the front door. Hey, there's a reason they can't come in the front door!
The current DEI issue is simply one of many. The DEI focus is not routine, the overall problem is.
The concept that a given person's race or background makes them willing or even qualified to speak / address all people with similar background or race to me makes zero sense to me.
Boeing took a nose dive in standards and quality when they replaced people who understood engineering and product fundamentals with bottom-line focused MBAs. I hope Boeing serves as a cautionary tale for other companies, most others are not “too big to fail”.
It won't. The incentives are not aligned that way.
Whenever those MBAs in the C suite are judged by investor shareholders purely on financials, and they can pocket their own millions over short few-year timespans, they'll just juice the numbers to manipulate share prices and walk away from long term consequences.
I can't see this changing unless executive renumeration can somehow be tied to decades-long company performance. And ideally executive accountability can extend to real risks of jail sentences for poor decision well beyond when they jump ship.
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1. Imprison executives who made the decisions that led to the result. Preferably in a way that makes them spend their fortunes on legal costs so that when they get out in 20-30 years, they're dependent on social safety nets for the rest of their natural lives. People are dead because they thought that possibility of profit was worth the risk of hundreds of deaths. That's negligent homicide.
2. There is no 2.
Like, nobody really think about risking people's lives for slightly more profit. It's more like they think about "cutting cost to get promotion and make more money. What risk? There's no risk.".
It's not like Boeing are particularly competent. Their projects experienced cost overrun for example. This whole idea of outsourcing to individual contractors turned out to make development of aircraft even more expensive. Their space division is currently blowing another hole in their budget. Their Starliner program is a joke and has no future beyond the ISS.
Some people may need to go to jail because it's more than just gross incompetence, fair enough. I am just skeptical of long lengthy sentences.
When dictators publicly executed advisor 1 and then advisor 2 and then advisor 3, they would still manage to always find someone greedy/desperate enough to want to take a crack on chance #4 or #5. But it did nothing to make the advisors better, it just meant that the next guy had to be even more greedy or desperate.
I think an accountability approach lets engineers build for safety leveraging their expert knowledge, in contrast to a rule based approach which favors compliance and bureaucracy. Accountability will select for leaders with an understanding of good engineering and safety culture, rather than leaders who are good at bureaucracy and compliance.
I worked in the financial sector for a bit, where some leaders have personal accountability (eg chief compliance officer). I've seen questionable projects die because the company couldn't find someone to stay in that accountability role. The financial sector is not necessarily a good example of what I'm talking about generally, but in my particular experiences accountability seemed to work.
tl;dr: Fewer rules, more personal accountability.
Probably untrue, to the point that Boeing may prefer the government do this instead of pursuing the company as a whole. The problem was nobody was connecting the cost cutting to outcomes.
Just to be clear though, are you proposing that they should have these charges brought up against them and given the same rights to due process that everyone else gets, are you proposing something more akin to extrajudicial detention - a suspension of due process and the suspension of habeas corpus?
Deleted Comment
I'd go a step further. Follow the Truong My Lan case [1] - make these people actually fear getting executed.
I'm not a fan of the death penalty at all. It is disproportionately affecting the poor and otherwise disadvantaged. But for ultra rich people making money off of risking the death of others? Maybe that is what is needed to get rabid capitalism under control.
If the government keeps going on with not actually doing anything to the ultra rich until they steal from other ultra rich (SBF, Madoff), eventually people will take the law into their own hands otherwise. This United Health CEO will not have been the last, but "citizen justice" is not what anyone should want.
[1] https://www.cbsnews.com/news/vietnam-death-sentence-tycoon-t...
This country has been an oligopoly since its founding and apart from a few edge cases (FDR preventing the complete transition to socialism by placating the masses with the New Deal) the working class have never really had power.
CEOs, especially of large companies, are glorified management
It's apparent that the FAA's oversight powers are not strong enough to to overcome the financial pressures of management on their own.
For what it's worth, I work for a smaller aircraft manufacturer right now. Aerospace will always be a day late and a dollar short when profit is the focus instead of safety and sound design.
I don't know of any situation where "Boeing you're still solvent but we think you're being stupids." would be legal, or even desirable.
And that's fine. Bad companies get replaced by good ones. Life goes on.
There's at least three problems with this laissez-faire ideal:
1) For some reason that is hard to understand, the prospect of Boeing's long-term decline does not necessarily translate into incentives for the people at the helm to steer it right. They can reap unfathomable rewards while guiding it to its doom. That's not only perverse and unjust, it's also bad for incentivizing success. This is not necessarily something specific to Boeing; any company is vulnerable to this disease.
2) It may be a contagious condition. When executives who ruined Boeing leave the company, they may take up influential positions at other companies, and have similar destructive effects. It's hard to understand how this can happen, but it's the sort of thing that does happen; that is a major problem that deserves to be solved.
3) A Darwinian process of creative destruction is fine if Boeing were sinking because it was improving but too slowly, and Airbus had improved even more and faster and surpassed it. If Canon replaces Kodak, life goes on and we get nice cameras. But in a case where Boeing dies not by being outgrown but by regressing, because 2024-Boeing has worse quality standards than 1994-Boeing, there's nothing fine about that; that's something that should concern anybody who cares about the production of high-quality airplanes. It's worth examining how we got here, and if an incentive disconnect at the executive level is responsible then there could be very valuable lessons to learn about corporate governance going forward.
the industry simply doesnt compete enough, no?
To change this, you'd have to have a different source of funding for these enterprises at the least.
the transition from worth less to worthless isn't very far. even in monospace fonts.
After the MD merger everyone knew it was bullshit they were moving to Chicago. The move to the DC area is equally bullshit.
How did considering the race of the person appointed even come up?
I can't imagine either side thinking there was some kind of advantage to doing so?
Yeah I don't see a reason that just because the DOJ is a part of a legal deal ... somehow their department policies should be injected. Could have some very negative outcomes and strangeness about what kind of deal DOJ can even make if a department policy gets injected that counteracts something in the deal.
Yeah, makes sense that he would interpret a reference to DEI as discriminatory. Maybe he wants to get noticed by the incoming administration for appointment to a higher court?
Deleted Comment
The current DEI issue is simply one of many. The DEI focus is not routine, the overall problem is.
Whenever those MBAs in the C suite are judged by investor shareholders purely on financials, and they can pocket their own millions over short few-year timespans, they'll just juice the numbers to manipulate share prices and walk away from long term consequences.
I can't see this changing unless executive renumeration can somehow be tied to decades-long company performance. And ideally executive accountability can extend to real risks of jail sentences for poor decision well beyond when they jump ship.
Dead Comment