99-year old trucking company Yellow shuts down, putting 30k out of work

Total comp was over $2m/yr for the past several years, and the C-suite execs were each earning $1m-$6m the past several years, even the CTO. It’s another case of public losses, private profits.

Related -- just abject corruption:

https://www.nytimes.com/2022/04/27/us/politics/trump-pandemi...

> The $2.2 trillion pandemic relief package that Congress passed in 2020 included a $17 billion pot of money set up by Congress and controlled by the Treasury Department to assist companies that were considered critical to national security. In July 2020, the Treasury Department announced it was giving a $700 million loan to the trucking company YRC Worldwide, which has since changed its name to Yellow.

...

> The loan raised immediate questions from watchdog groups because of the company’s close ties to the Trump administration and because it had faced years of financial and legal turmoil. The firm had lost more than $100 million in 2019 and was being sued by the Justice Department over claims that it had defrauded the federal government for a seven-year period. It recently agreed to pay $6.85 million to resolve allegations “that they knowingly presented false claims to the U.S. Department of Defense by systematically overcharging for freight carrier services and making false statements to hide their misconduct.”

> To qualify for a national security loan, a company needed certification by the Defense Department.

> According to the report, defense officials had recommended against certification because of the accusations that the company had overcharged the government. They also noted that the work that the company had been doing for the federal government — which included shipping meal kits, protective equipment and other supplies to military bases — could be replaced by other trucking firms.

..

> Yellow had many connections to the Trump administration. The company had financial backing from Apollo Global Management, a private equity firm with close ties to administration officials. Mr. Trump had selected the company’s chief executive, Darren D. Hawkins, to serve on a coronavirus economic task force. And he had nominated the company’s former chief executive, William D. Zollars, to the U.S. Postal Service’s board of governors.

..

> A law firm representing Yellow sent a letter to Mr. Clyburn before the release of the report defending the company’s actions and describing many of the allegations as “baseless.” The company stood by the trucking services data that it provided when applying for the loan and said that Yellow has paid more than $25 million in interest on the loan. The letter also noted that company had settled its dispute with the government last month.

> The letter, which was written by Marc E. Kasowitz, who was previously Mr. Trump’s personal lawyer, was provided to The New York Times by Heather Nauert, an adviser to Yellow who was previously a spokeswoman for Mike Pompeo, Mr. Trump’s secretary of state.

Pensions seem like an outdated concept, when 401Ks and IRAs are options. Pensions are essentially a tradeoff of lower pay now in exchange for benefits in the future, with a sprinkle of an incentive for increased retention added in, but with the critical downside (to the employer) of it basically being an unbounded, undefined financial downside for them at the tail end.

Employers should pay people, contribute to their retirement funds if further tax-advantaged incentives are needed (and society can and should have further discussions on how complicated these tax laws are), but people should own and be in charge of their own retirement funds.

You know this is market right? They can't just charge whatever they want. If their service is worse than competitors and they are unable to make it better they need to undercut the competition. Sometimes businesses fail, that doesn't necessarily mean the strategy was bad, could've just been bad execution.

Ok, in the case of Uber it's undercharging and living off investments (from investors who hopefully know what they're doing), in the case of this 99-year old company it's undercharging and living off federal bailout packages (paid by the taxpayer). I would say that's a bit different...