Q: I know you criticized
Newsweek andThe New York Times downsizing piece in a recent
speech. Are you saying they're just plain wrong?
Eaton: Oh absolutely. I think it's just sensationalism that just absolutely makes
my blood boil. What has happened is there are huge changes in technology out
there and as a result companies have to adjust or they'll go out of business.
Again, the number one responsibility that we have is survival so that we can
employ people, so that we can pay taxes, so that we can contribute to the
community. To say that management's whole objective is to reduce the number of
employees and that they don't care what happens just shows a lack of
recognition, of simply not understanding the world at all. Again, we're able
to do this and get more competitive and yet have the lowest unemployment that
we've ever had. That shows very strongly that what's happening is good, not
bad. Yes, there's dislocation of people. It's hard in the interim. But an
awful lot of people are getting better jobs than they had before, higher paying
jobs, people are moving from the lower quartiles to the upper or middle
quartiles. As I said, the American Dream is absolutely alive and well.
Q: A last question --because I know in that same speech you were talking
about CEOs as being victimized unfairly. From the point of view of the worker,
a lot of them have been laid off, can't get jobs. A lot can--but a lot of
them can't. I don't think they'd begrudge CEOs a really good salary. But when
a CEO lays off a lot of people and then gets an award of ten, fifteen, twenty
million dollars or more, it seems to the workers to be pretty callous.
Eaton: Well, first of all, there's no question that I think CEOs in this country
are very well paid. They are paid by a committee of the board of outside
directors who are dedicated to representing the shareholder. There's been a
big change in compensation in this country in the last few years and it's tied
to the performance of the stock. Something approaching seventy-five percent of
my compensation is purely tied to the success of the stock. We talked about
how if the company makes a profit, everybody benefits. Obviously, the
shareholders benefit. The employees benefit through profit sharing, plus
expansion and more jobs. The community benefits from taxes and contributions
to charity, the arts, etc. And, yes, the management benefits as well. That's a
change that has occurred in the last ten or fifteen years which is I think a
very good thing -- to tie the CEO's ultimate compensation to growth and
shareholder value.
