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- เผยแพร่เมื่อ 1 ก.ค. 2024
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Depending on who you ask, Jack Welch is either the greatest CEO to ever exist or the man who single-handedly broke capitalism.
From 1981 to 2001, Welch led General Electric. He’s often thought of as the first celebrity CEO, a businessman who wowed investors and mingled with celebrities. The changes he made turned General Electric from a respected industrial giant into a huge international conglomerate and the most valuable company in the world, but it all came at the expense of workers, consumers, and innovation.
Perhaps the name General Electric doesn’t mean much to you now, but once upon a time, GE was so big it had the swagger now held by big tech giants like Amazon or Microsoft. It was on the cutting edge of technology, spearheading the electrical revolution, the creation of radio, CAT scans, submarine detection, and many more innovations.
Welch was hungry for power and money. His goal was maximizing profits even if that meant cutting jobs, playing fast and loose with accounting rules, or acquiring and selling companies for parts. His three primary principles were downsizing, dealmaking, and financialization.
His short-sighted tactics and obsession with downsizing, outsourcing, dealmaking, and shareholder primacy single-handedly destabilized the middle class. Yet he has influenced generations of CEOs with similar short-sighted ambitions who continue to destroy livelihoods and increase inequality to this day.
When he took over GE, he fired a lot of people, which threw the American working class into chaos. His policy was known as the Vitality Curve.
Managers rated their employees yearly and the bottom 10% were let go. A practice that CEOs still use to this day. in his first few years of leadership, he fired more than 100,000 people in a series of mass layoffs and factory closures.
But Welch’s main weapon for making GE the world’s most valuable company, was dealmaking to consolidate industries and gain market share. During his time in office, he bought almost 1,000 companies, spending over $130 billion to do so.
Welch’s worldview still affects a lot of businesses in the United States, even though his ideas are almost 50 years old. It places the interests of shareholders’ profits above all else.
GE was an early leader in organizational design and training for executives. Eventually, these executives went on to run dozens of other big companies, like Boeing, 3M, Home Depot, and many others where they spread Welch’s views across all of corporate America.
This is how Jack Welch eroded America’s middle class, chipped away at the tax base, exacerbated inequality, and crushed the soul of corporate America.
This Jack Welch documentary is based on the book "The Man Who Broke Capitalism: How Jack Welch Gutted the Heartland and Crushed the Soul of Corporate America―and How to Undo His Legacy" by David Gelles.
00:00 - The Man Who Broke Capitalism
01:05 - We Bring Good Things to Life
05:00 - Tidio
06:33 - Pre-Welch
08:40 - CEO of The Century
09:51 - The Friedman Doctrine
11:10 - Neutron Jack
14:09 - The Pacman Scheme
16:14 - Jack's Cathedral
17:44 - The Fall of An American Icon
19:41 - A Tainted Legacy
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What a f*cking joke!
I'm old enough to remember the downsizing craze of the 1980s/90s. I knew an older man who worked at such a company for decades. He needed 30 years to get his pension. They fired him in his 29th year. He then went to work as an elderly janitor, with no security. Jack Welch and others like him are evil, they detroy lives and societies.
He should have sued. In Asia they pay you a bonus that's often the majority of your total compensation on the last day of the year, and they've been known to fire people on December 30.
@@raylopez99 Justice is split in the USA. Unless you can actually find an attorney who wants to right a wrong, good luck with suing.
Never trust centralized pension schemes, ever! 40K or IRA all the way. Pensions are nothing more then IOU's, and you can never completely trust the people give you those IOU's. Jack Welch is not just an example of what's wrong with corporate America these days, but what's wrong with the ruling class of this country. They're a bunch of short-sighted, greedy, irresponsible self-agrenadizers who have ran the country into the ground and that's why it's such a bad shape these days.
Jack probably did not know this older man, he is just serving his shareholders over his employees and public companies are pressured to do or face law suits from shareholders. Ultimately, we simply cannot depend on job security for any employer. If GE went bankrupt, he would be out of work as well. Makes the employees dependent on their income like me never secure in our jobs, but as we can quit without warning, so can they quit us. In the end you cannot depend on man, but then again I have faith in a higher power. It seems self employment is the only job security and that is being in your own business and that business may not succeed. Capitalism with all its flaws beats socialism as then you have put your faith in something that is not sustainable and kills the human spirit. No simple solution, but Jack Welch is just as human as anybody else and made hard choices to grow the company.
@@Baruch-Hashem Jack's problem was he embraced financial engineering. I saw a study once that synthetically paired a competitor to GE with a bank and found this hybrid stock combination about equaled GE in performance. So Jack should have broke up GE Capital from GE and had them separate. We are GE shareholders from way back and only now is GE going back to its 2007 highs (slowly, maybe in another 5 years it will surpass them).
When our dishwaher expired our repair person suggested any brand except GE.
GE Appliances is now owned by Haier.
That's because even GE commercial wind turbines are just another chinese company using a name under licence. GE is Haier and they're junk. I've got 3 washing machines and I think my parents have a fridge. They are using ZIP TIES in place of hose clamps, PVC pipe in place of rubber that goes soft with heat, the things are rotting with rust, no ACTUAL chassis just curved sheetmetal connected to a big one piece plastic base. Honestly inside they are the quality of any no-name brand chinese junk. Put together like they're some kind of improvised junk that has to last a few hours to get you out of being stranded. I had a spin dryer die ad then randomly a few months later started working again, all the lint filters wouldn't stay in after a few years because of junky plastics. They pretty bad
Jack Welch has gone from hero to zero. Pundits would now list him among the ten worse CEOs of all time.
Never liked him
I think you did a good job on filling everyone in on how evil he was as far as economics but you missed the biggest part and it’s not an economic issue. I’m from Pittsfield MA where he started as a chemical engineer. Before Jack Welch was named CEO and closed the entire pittsfield plant, GE was dredging PCBS into our lakes and into the Hudson River (and doing the same at the Schenectady plant in NY). Jack Welch has publicly said (you can look it up) “There’s not evidence that PCBS are harmful” which is complete nonsense because they actually cause cancer and birth defects. That’s the reason why GE has spent over a billion dollars on clean up efforts here, and not to mention the only reason why there is a GE company in Pittsfield is because they hired all of these environmental engineers to help cleanup the mess they started, that’s it. I’ve heard from many people that he was the biggest scumbag who ever lived. This is a true story: a not pleased employee keyed his car one day, he was outside with a bunch of people around him and he said “oh you think that’s funny huh? I’m gonna turn this town into a f*** ghost town”.
Does Chainsaw Al mean nothing? :)
This is one of the people that destroyed manufacturing factory in America
Destroyed the middle class, retired and eventually died obscenely rich.
That was nafta
People who thought like Welch, thought NAFTA was a good idea.
Manufacturing in America is booming. Great paying jobs and everyone is hiring
No sir. That was corporate tax hikes.
Welch, Lay and Skilling were the pillars of corporate America. The formula was easy: show results today, with tomorrow’s resources.
The company he led went down in flames in 2008 and required a bailout. I don't get it.
"He" got out before it crashed. "He" was hailed by all. "He" became rich. "He" taught other sharks to be rich. The people who worship him want the same. Same people who love the "greed is good" line from Gordon Gecko.
While he was in charge, GE made a fortune and the stock did better than 19% per year for 20 yrs. Neutron Jack.
I worked for a GE startup for a few years. The beaurcracy of GE was so top heavy and difficult, GE was its own worst enemy.
He created the heavy “mid management “ structure with tons of deadweight. Exploit the performers and then get rid of them.
Shortsighted people back then used to praise him as a genius and look where GE is today because of him
CEO culture today has turned them into value leeches that have taken corporate America down with them
So think twice before criticizing people researching companies and practices like that and having the abilty to see long-term consequences of business strategies
Worked for a CEO like this. Ultimately a very destructive person. He was a CA. Knew nothing about the business and was only interested in the little profitability strategies that he had been taught at university. What a disaster. Surrounded himself with a bunch of similar minded narcissists who sang his tune. Didn't want to listen to anyone who warned about the strategies and how damaging they were to the business. Also used the one-big-happy family mantra to BS employees but in fact cared only about the money. Stripped off profits that was created by his predecessors. Destroyed the company's reputation. People who had been with the company for 20 years were bullied out of the company. Now it's a failing company. Sad but a fitting legacy for a weak and greedy little man.
These individuals usually reap what they sow. Perhaps one has to wait a while for the karmic result, yet it indeed will happen.
The Boeing contribution aged poorly
Jack Welch, the wrecking ball behind the demise of the NBC Radio network and WNBC radio.
80s greed
This is why Boeing is having
all these problems now
Yep, profits over people never wins in the end.
Calhoun was his buddy at GE. Funny they look eerily similar.
@@CngDelta757Calhoun is not the source of the problem.
I believe the OP is referring to McInerney who was another GE alumnus.
After losing the Welch succession race to Immelt, McInerney went to 3M for about 4 years. Then in 2005 he became CEO of Boeing. He was there until 2015.
What's funny to me is companies used to have souls
They didn't really, but they may have become more evil.
When I first heard of the vitality curve, my mind immediately went to Amazon
Used to work for the appliance division. He was not well liked among legacy employees.
America must create a corporate “museum” with the great entrepreneurs as well as these corporate vultures who have destroyed the middle class and killed the American dream. He and the Republican Party of the 1980’s whom encouraged globalization. The Midwest saw the # of factories get shipped overseas by the hundreds.
It got started under Nixon. But really got going under Reagan.
holy crap, people are actually defending this guy?
Yes. Unfortunately said people are fellow CEOs.
Yes. Stockholm syndrome on a social level.
Corporations destroy competition and innovation
Yep -- they convince intelligent, independent & critical thinking folks to do "one for the team", pushing that idea over and over -- then this is often what happens .. "group think" ends up ruining it all.
Jack Welch did not break capitalism: How bared its fangs and used them. His style was capitalism's endgame, which is to hoard all of the value.
My uncle worked at GE's Appliance Park in Louisville KY from 1970 until 2001 after serving in Vietnam and he says at the height Appliance Park employed about 8,000 people then jobs began being outsourced under Neutron Jack Welch. When my uncle retired in 2001 he said they had less than 1,000 employees . Haier bought GE's Appliance division but they still make appliances under the GE banner
Nobody worships him, a lot of people fear him.
He has ruined Boeing, so I despise him, not worship him.
This guy did not just help ruin manufacturing in America, he made bullshting into an art form for corporate executives, which resulting corporate executives putting greater emphasis on theoretical value then tangible value in order to juice the stock value without putting any accompanying tangible value in order to make themselves look good for investors so they can get they're stock options and bonuses. It just not made the corporate America more greedy, it turned into the dysfunctional awful hellscape that is today.
I have worked for 2 American companies. And yeah, I recognise that style of management.
Not pleasant to be judged, micromanaged and bullied at work.
Have we found here the beginning of the homeless problem?
Seems to be.
maybe if you cry harder it’ll get fixed
What I find the worst is how Jeff Imam was left WITH A SHELL made to look powerful and if you come across any former GE CORPORATE types, the blame Jeff and PRAISE Jack. It takes you about 30 seconds of reading to realise what vain slimy type of people these former corporate guys are. The type completely disconnected and indifferent from guys on the ground floor.
The final few years he took money from the insurance company to show a steady profit rise each quarter, raising stock price. . Eventually it collapsed. But he got all his bonuses.
The Jack Welch way turned the company into a feudal state.
Really well edited, nice video!
Thank you!
Neutron Jack says "Rank and Yank"! Adding shareholder value baby, yeah!
G-d bless, Welch. he is probably why the US economy did not become totally dysfunctional in the 1980s. "Control your destiny or someone else will."
The rise of the CEO sociopath
Curse to American manufacturing industry
There's a special place in hell for Jack...
It makes me wonder how he is he actually living in the afterlife 🤔
Let's hope.
Greed greed greed
His 3 principles were: 1) downsizing, 2) downsizing 3) downsizing….
as long as he was not included in the equation.
Nice work, Subbed
Excellent video! I admire the well-crafted script, sound design, and overall flow. Keep up the fantastic work! Subscribed
Thank you! 🙏
Corporations need to fire the takes salary positions that family owned companies don’t need. Corporations like the government get way too bloated at the top and they lay off the actual people who work.
Bottom 10% of ceos
He did his job. Full stop. His job was to give the company owners (share holders) money aka dividends.
If it wasnt him, it would have been someone else. Js
But then he ran The company into the ground. He failed in the end.
@@cane6074 ge? Still going strong
I tak oto odszedł potwór, hiena cmentarna ale USA załuguje na takie potwory samemu będąc potworem.
The sad truth is after a time what ever company takes his ideas on. when they hit that tailspin its almost impossible to get out of it look at Honda as one example. They got rid of RD and sent all of it to China
That man should be on “American Greed”.
Goodness. Thomas Edison would be rolling in his grave. This guy’s evil influence has possibly put us on the downward spiral of Western civilisation. Is it possible to come back from this?
As an entrepreneur in the '90s, I like many thought Jack Welch was a rockstar. I bought his book.
But after Trump was president and I heard Welsh gushing about Trump's, gutting the epa, and cutting all kinds of regulations, I knew what kind of capitalist he was and I threw out his book.
Great. Just say what his compensation package was. I read about it many years ago and it was jaw dropping. Of course, maximizing profit is always rewarded - after all, we don't care about the people working for us; only about the investors, because they are the only who can fire us.
the friedmann doctrine was absolutely terrible for every other stakeholder other than shareholders. what a scumbag
also, subscribed!
Ah yes, the Reagan Years which Americans remember so fondly! SMH Overall, a good look at Welch's reign and management "style". The only thing you might have overlooked was the NABET strike at NBC back in '87!
Gee, lower evaluations if you SUCK at your job, who would have thought that would happen. Yay Amazon!
IIRC this is the same guy that wrote a book called Integrity , then he dumped his wife for the woman who helped him write it. INTEGRITY OK, NEUTRON JACK.
What a bastard
I owned a bunch of GE stock in the 90s. I sold it all in 2005.
He was a world class Clown who turned colleagues into competitors
Destroyed GE
Thanks to Jack Welch corporate America's mission statement was reversed instead of first being devoted to your workers and your community Prophet came first and the formula they used was simple when your age plus the number of years you were with the company equal a certain level you will let go
The 80's seem to be where America went wrong.......
Six Sigma is evil.
If it makes anyone feel better, that massive disparity in wealth is almost entirely stock just like GE.
Did the same like Enron
Legend, genius.
Neutron Jack.
TH-camr making up a populist narrative about a subject way beyond his understanding.
So he got it wrong......good
Screwed everything up
Why is he even mentioned today, disgusting 😢
always at the expense of workers (slaves)
I mean, the only reason you lay off an employee is you don’t need them.
Look at where GE is now.
Keep licking that boot simpy.
If only they applied that logic to Jack Welch
I mean, given their state of business, maybe they didn't know what they needed.
Bunk
You did a great job with ge, and then undid yourself bringing Amazon at the end of the
It all crashed post Jack Welch. He was ruthless but Wall Street loved him. Employees he didn't layoff loved him because their 401K's did so well. I hear no one complain about paying for stadiums so athletes can make millions off the poor tax payer.
When did take off with his girlfriend? Phoney.
Greed
Milton Friedman is by far the best economist to ever live. Hands down
fraud is bad and all but 4k percent in shareholder return there is a reason the dude is a legend
The 99%
He saved GE. You are a dope.
You're the delusional dope !!
I love your channel and I’m always impressed by all the research you obviously put into each video.
That said, it’s becoming very hard for me to want to watch more due to your obvious & overt anti-capitalistic, social labor party bias.
Jack Welch was certainly not the first to use his business tactics to grow huge profit, but was perhaps the first to be so “successful” in doing so.
If it wasn’t him gaining headlines, it surely would have been someone else doing the same exact thing.
Some would say that his methods helped to create American financial affluence & power and were a driving force behind America’s global dominance.
Not saying I side with him or agree with his methods, but I am saying that your presentations are extremely opinionated and fail to present the points of view which oppose yours.
Could it be that you’re so blindly confident that your point of view is universally accepted that you fail to recognize other, contrary opinions may be correct?
Everyone is welcome to attack me for my comments, but I am also a subscriber to this channel & really enjoy and often learn from the videos.
I just felt that this one was very biased, based, opiated and didn’t present both sides of the story.
Not saying I don’t agree with much of the views presented, just calling out bias.
Ask yourself, is America better off after exporting its manufacturing jobs?
15:11 That's just ridiculous. Buybacks don't equate to manipulation, it's just a form of returning capital to shareholders. 20:09 That's bullshit, retail is run on very thin margins. Most of Amazon's net income comes from AWS & Ads.
Except it was considered manipulation from 1930-1980, until the Safe Harbor Rule in 1982 when financial deregulation began and the SEC decided it wasn't manipulation anymore because corporations told them it wasn't.
Buy backs are horrible, they encourage companies to buy back up to 50% of profits. Actually even more with debt. What this does is Rob the long-term health of the company and the stockholder returns in the future. These companies do not invest properly in capital assets, equipment, or future ventures that are high risk and can make massive returns later.
So yes, buyback need to be made illegal again in order to set right the financial ship of America, both for employees and stockholders. This one would actually benefit both groups, long-term. Unfortunately, in order to do this, there needs to be tax reform for dividend taxation. Dividends are one of the most highest tax assets. You might not think so looking at it at first, however most states tax dividends. When you combine federal and state taxes, it’s no wonder Wall Street switched to buybacks. State and federal government are to blame here. If you want less of something tax it more.
This video is endorsed by the unions protecting the lame and lazy.
You must be one of Jack's nepo babies.
@kingboobs20 You must be one of those lame and lazy union workers telling us a high school degree should be paid $75/hr to push a button. I can give a monkey a quarter and a cup of coffee to do those jobs, lol
I've never worked for a union and somewhat look down on those that do, although I get it. This being said though this guy was far from a genius, GE is worth less now than it was last quarter century ago, as was recapped at end is CEOs are still trying to get company out of the mess jack created.
@@kingboobs20 You must be that lame and lazy, barely graduated union guy I was talking about. Give me 75/hr to put some screws in a zip lock bag!