Posted on 02/10/2010 6:03:51 AM PST by AndyJackson
Jim Tisch, the leader of Loews Corp., said the U.S. did a “good job of killing” the hotel business by lambasting corporate travel and hurt American International Group Inc.’s ability to return bailout funds by curbing pay.
“The criticism that took place of group travel was really a death knell for the industry,” Tisch said yesterday in an interview at an office of the New York-based holding company, which owns hotels. “It’s easy for the politician to get the sound bite. What they are doing with those sound bites is putting maids and bellmen out of work.”
Loews’s hotel unit posted a $34 million loss in 2009, compared with a $40 million profit in 2008. Tisch, the chairman and chief executive officer of Loews, said group travel comprises about half the firm’s hotel business, and operations suffered as lawmakers disparaged corporate trips amid the $700 billion rescue of financial firms. In 2008, bailed-out AIG canceled about 160 events costing a total of $80 million.
Loews’s fourth-quarter average room rates fell 14 percent from the year-earlier period to $217. Occupancy decreased to 61.6 percent from 65.8 percent, Loews Chief Financial Officer Peter Keegan said yesterday in a conference call.
President Barack Obama last year said companies receiving aid should curtail travel and pay. “You are not going to be able to give out these big bonuses until you’ve paid taxpayers back,” Obama said at a town hall meeting in February 2009. “You can’t get corporate jets. You can’t go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers’ dime.”
Mr. Tisch did not create the bubble economies. John Q public and his elected officials did. They demanded a free lunch and the politicians promised they could have it. The corporate execs did not create the manufactured goods deficit. Once again it was the politician and the unions who created the free lunch and punish the producers mentallity.
Have you paid attention to the news at all? The majority of corporations that took bailout money didn't want it. They were forced to do it. Meanwhile the Feds were intimidating companies into deception to cover up the truth. I have no love of corporate execs, but I also realize that they sold snake oil because the public demanded snake oil.
When the government at the behest of the citizenry punishes productivity and rewards risk, where does the government and citizenry get off complaining about the result of that risk?
We’re in the hotel business in the Midwest. Times are tough. Occupancy is way down for everyone- no matter what your market is. Business travel is off dramatically and it doesn’t appear to be getting better. We are trimming expenses every possible way and just trying to keep people employed. The few salaried positions are absorbing shifts from hourly employees in hopes that the hourly employees would prefer having their hours rather than their positions cut.
And congress killed the US Yacht building industry with their "Luxury Tax". Tens of thousands of Americans lost their jobs over that and boat building moved off-shore.
Oh HS! Mr. Tisch and his family made their money off of the real estate bubble. They created it by taking easy money and dumping it into real estate in the first place. They got the easy money because Alan Greenspan thought there was nothing wrong with easy money. Indeed, Sir Alan stated that he never believed that executives would put the existance of their corporations at risk for their own personal gain.
One person is innocent and that is me, since I have told everyone this loose money inflating a real estate bubble was bad policy since I came of working age.
I know it is tough. My family has a business in a related industry. But you are not Tisch whining to the federal government because times are tough.
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