I don’t know if AynRand.org runs an annual awards ceremony, but if they do, I’d like to nominate Michael O’Leary, the Ryanair chief executive, for the Hank Rearden Award for Top Quality Businessman of the Year. Check out this piece, in today’s Telegraph.
Just to tempt you, here’s some quotes:
We are never paying a dividend as long as I live and breathe and as long as I’m the largest individual shareholder.
It gets better:
Go to Waterside [BA headquarters] and tell Rod [BA’s chief executive] he’s going to grow profits by 12pc this year and he’d have an orgasm… God speed [Rod]. You’re doing an outstanding job. Keep it up.
Our friends, the EU, are also thinking of prosecuting Ryanair on some spurious grounds of whether Ryanair received state aid at Charleroi airport, its Brussels’ base. O’Leary describes this as:
Regulatory bullsh*t.
Excellent! Michael O’Leary has also said that if the EU rule against him, he will shut Charleroi down, and sack its 3,000 workforce. He rounded off this promise, in typically uncompromising fashion, with the following statement:
I’ve no intention of making life easy for bureaucrats.
Bravo, sir! Unfortunately for Dagny Taggart-style ladies everywhere, multi-millionaire Michael O’Leary is getting hitched soon, though he’s not letting it put him off his financial stride:
The reception is going to be cheap. The honeymoon is going to kill me.
Though recently, his thoughts have also strayed to politics and sport:
I think a right-wing dictatorship led by me would not only improve the Irish economy but the Irish football team too.
What a dude. I’ve got some Irish blood in me. If Michael O’Leary ever becomes Prime Minister of Ireland, I wonder if they’ll let me swap passports? I quite fancy Dundalk, which remarkably, is also the home town of The Corrs.
We are never paying a dividend as long as I live and breathe and as long as I’m the largest individual shareholder.
I’m interested in why this is so important to you?
Having been in an emergency landing in a Ryan flying death trap coming into Oslo Torp a few year back with a jammed shut flap, I have very little that persuades me to fly with them ever again.
A) In what way is paying dividends a bad thing?
B) Why are you quoting a Pinochet wannabe in a way which indicates you regard him as some sort of hero?
Dave,
Ryanair will shortly have the youngest fleet in Europe, althought I am sure that was no comfort to you at the time.
Michael O’Leary (with the backing of Tony Ryan) has singlehandedly transformed the shape of travel in Europe. For example Aer Lingus today announced a major turnaround in its financial position since adopting a low fares philosophy.
Irish residents for years were denied cheap air travel, having to use the cattle boats to Holyhead, whilst their betters in the Civil Service floated above them sipping free Gin and Tonics. Ryanair have since brought more of the same to millions across Europe, freeing them from the tyranny of the State run luxury airlines.
I am shortly flying return to Nice for €240, yet a single flight on Air France to Paris, where they have a monopoly costs €400.
He would make a brilliant Taoiseach, however I very much doubt he’d put up with the bullshit for 5 days. The Irish press hate him already because he constantly proves their left wing crap is just that.
Andy, I’ll stand you Guinness and oysters in Carlingford if you make it over to the Emerald Isle.
Fascinating. I especially like the Charleroi related comments.
Also, no dividends is very sound growth-oriented policy. It worked for JD Rockefeller.
Ryanair will shortly have the youngest fleet in Europe, althought I am sure that was no comfort to you at the time.
Rattling down the runway with my head between my knees at 160mph? No, no it isn’t.
However, with the competition I can now fly low cost on lots of altneratives including BA and Easyjet from my local airport.
I fly long haul about once a month and have, in my time been forced into all sorts of airlines. The thought of ever flying with a low cost airline long haul again fills me with dread. Even at my own cost I pay the extra for decent service and extra legroom.
Also, no dividends is very sound growth-oriented policy. It worked for JD Rockefeller.
That depends on the structure of your investors and what they are looking for.
It just stopped working for Bill Gates.
Think you need to read Atlas, because Hank Rearden was a bit of an arse, and he married an idiot, and he was a crap buisness man.
As for “Dagny Taggart-styled ladies” come on you really think she/they would settle for a Michael O’Leary? when they are men like Conrad Black around.
It’s been several years ago since I flew on Ryanair. My fondest recollection was the pre-boarding announcement that they would board women and children first. The immediate thought that came to mind were all those movies where the ship is sinking and the captain makes that same fatal announcement.
I’ll chip in for the Guinness in PJs in Carlingford (as it is my local!) but I’ll pass on the Oysters.
Dave – Pls. expand on your comment re Bill Gates. I had thought that recent changes in dividend policy at Microsoft were driven primarily by changes in tax laws.
The change in tax on dividends will make a difference, but reading the financial pages, the biggest pushhas come from small shareholders who no longer can make handsome returns by offloading share options on the cheap.
The market has changed, especially for companies like Microsoft – the year on year growth and explosive share prices which allowed them not to worry about dividends and the like have long gone.
That said, the MS dividend was pretty small.
Dave O’Neill writes:
I’m interested in why this is so important to you?
Because it proves it is his company, and his to do with as he wishes, which is excellent. If anyone doesn’t like it, let them form their own airline.
His message to shareholders is also, invest in me, and I will grow the value of your shares. If you want regular dividend income, try something a little more sedate like Marks and Spencer.
Having been in an emergency landing in a Ryan flying death trap coming into Oslo Torp a few year back with a jammed shut flap, I have very little that persuades me to fly with them ever again.
And in a free market, that’s your privilege and your choice. And isn’t that the wonderful thing about it, compared to the statist duopoly crap we had a few years ago, with only British Airways flying to Rome, and only Air Italia flying to Britain, something Ryanair and others like Easyjet have exploded? And if Ryanair want your custom back, they’ll have to improve themselves to your satisfaction (and may have done so already) to get it, and then prove it to you.
If you want more ‘security’ in flight, I suppose, you can pay ten times more for BA. And then spend the weekend on the floor of their terminal, when their ‘over-manned’ work force realise the game’s up, and that they’re actually going to have to spend 8 hours at work, to get 8 hours pay. It’s an outrage! I shall write to my MP.
But again, if you want to spend more, it’s your choice.
I find the beans in the Tescos 8 pence tins of beans rather hard, and I will not buy another tin until they prove to me they’ve softened them. Until then I’ll buy Heinz Beanz. I’m not going to criticize Tescos for producing cheap beans though. I might be able to afford Heinz, but I bet there’s a lot of people out there benefitting from beans at 8 pence a tin. Thank God for the free market.
Della writes:
In what way is paying dividends a bad thing?
There’s nothing wrong with dividends. I’m sure my Gordon-Brown-robbed pension benefits from them regularly. But he is not going to be forced into doing it, with his own company, just to satisfy City bean counters and financial journalists. He wants to grow, and expand, instead, in this dynamic market. And if you don’t like it, invest somewhere else.
Why are you quoting a Pinochet wannabe in a way which indicates you regard him as some sort of hero?
Oh dear, is he a racist as well? When he actually stands and announces a policy of taking lefties, slitting their bellies with bayonets, and throwing them from helicopters, I’ll accept he is a Pinochet. Until then, let’s admire him for his unbelievable success in almost single-handedly taking on the might of the EU air flight regulating collectivists, and former state-subsidised giants, who only wanted taxpayer-subsidised luxury-price flights for themselves, and all of their big corporate state mates in government or government-related business, and kicking them into the middle of the nineteenth century. Here’s to you, Michael O’Leary.
Hmm….Let’s see if we can come up with a definitive list of leftie hate words:
Racist (obviously)
Pinochet
Selfish (a capital offence)
Thatcherite
Reaganite
Right-wing nutters
Flat Earthers
Little Englanders
Anti-social
Errr…..struggling…..aha! Bonkers (as in ‘Right-wing Flat-Earthing Little-Englander Racist Bonkers-Merchants, opposed to the Euro’ – see any issue of the Guardian)
Edmund Burke writes:
Andy, I’ll stand you Guinness and oysters in Carlingford if you make it over to the Emerald Isle.
Cheers, fella! 🙂
Dave O’Neill writes:
It just stopped working for Bill Gates.
Hmmm…I bet he’s real worried! $-)
Andy, nice replies to the above rather lame attempts to have a pop at this fine article!
The guy sounds a dude. Actually the founder of Easyjet is also in this class.
I fly Ryanair quite a bit to places like Knock in western Ireland and they put on a good service, very reliable and cheap. Compare that with when I had to fly to Switzerland on business for four times the fare and over the same distance.
The low-frills, low-cost airlines are run by some of the sharpest entrepreneurs today. Ayn Rand heroes indeed.
I am told the Galway Oyster festival is worth a visit, BTW
Della,
Is Michael O’Leary as bad as Hitler or even worse than Hitler?
Besides Augusto Pinochet saved his country from marxist immiseration and despoilation. I think that’s pretty heroic actually.
Regading the dividends question, I cannot remember where I read it, but Warren Buffet lays out a very clear explanation of why a company shouldn’t pay out dividends.
BRKa in 1991 $6000, BRKa on August 6th 2003 $72000 makes fairly convincing evidence.
Although this may be different now due to Bush’s tax changes.
Because it proves it is his company
I have to take issue with this. It is NOT his company, it is the shareholders company, of which he is one.
If he wants a private company, then let him have it, but he can’t have it both ways. While I am no Alan Sugar or Branson fan myself, I admire their realisation of the this problem and bought their company back.
If you want more ‘security’ in flight, I suppose, you can pay ten times more for BA.
Comparing BA and Ryan Air Bristol/Cardiff to Dublin BA is slightly cheaper.
And then spend the weekend on the floor of their terminal, when their ‘over-manned’ work force realise the game’s up,
A pain but one I carry more than adequate insurance to cover – as it happens I flew BA to Paris that weekend from Bristol and there were no problems. I have a few friends who work for BA and the problem isn’t so much being expected to work 8 hours, but suddenly finding you won’t be working 8 hours because management want to save money and lay you off for the afternoon. There is a fundmental management problem.
I haven’t been delayed with Ryan Air but I have with Easy Jet and other low costs and spending all day in the airport waiting for them to find another plane while their idea of adequate compensation is a £5 meal voucher and a 100 airmile ticket isn’t all that pleasant.
Ryan Air I am sure provides a wonderful service, its just I happen to like having some fall back positions when things go wrong, and I rather like my airport to be in the same country as the city I am flying to; “Oslo” Torp is in the same country, but it is 100 km from the city. It’s like calling Birmingham London’s 6th Airport.
It wasn’t me who said Michael O’Leary wanted to be a right wing dictator, he said it himself
Therefore I don’t feel it is unfair to point out that he wants to be like one of the previous right wing dictators.
Why should a libertarian like a right wing dictiator any more than any other sort of dictator.
Della writes:
Why should a libertarian like a right wing dictiator any more than any other sort of dictator.
Della, I believe Michael O’Leary has what used to be known, before the oppression of the PC class, as a ‘sense of humour’, as in:
‘If I were Prime Minister, I’d take all the lefties, put them up against the wall, and cancel their FilmFour satellite subscriptions.’
Do you really think that what Michael O’Leary said about the Irish economy and football team was in any way serious? I feel really sorry for you, if you do.
The fact he’s annoyed the hell out of you, in saying it, is amusing though! 🙂
Della,
Has it occured to you that Mr.O’Leary might just have been hamming it up for a journalist? People do that you know.
And I don’t like dictators of any sort but I think an objective assessment of Pinochet would lead to the conclusion that, as dictators go, he was very far from the worst and, in the round, probably did a lot more good than harm for his country.
Besides nothing is more sickening than watching the British and European left go ga-ga about Pinochet while fawning all over Fidel Castro.
David Carr writes:
“Besides nothing is more sickening than watching the British and European left go ga-ga about Pinochet while fawning all over Fidel Castro.”
Precisely! I don’t doubt that Pinochet was an odious creep, but… oh, what’s the point? The Left (among whom it seems we have to number some soi disant ‘libertarians’) have decided his name is to join the ranks of those used as all-purpose insults. There’s no reasoning behind the choice, so little point in expecting to be able to reason someone out of the stance.
On the question of dividends, I find myself (unusually) on the side of Dave O’Neill. If I lend money to someone or, as is more usual, hire someone as the managing director of the company in which I am investing, I expect a better return on my money than candyfloss promises that the value of my shares will go up. O’Leary may be a shareholder too, even a majority shareholder, but he has chosen to borrow other people’s money. Personally, I wouldn’t lend him a sou.
Dave O’Neill writes:
I have to take issue with this. It is NOT his company, it is the shareholders company, of which he is one.
You’ve obviously got a great deal of anger boiling up there, about Ryanair, and that incident you mentioned. So I repeat, if you don’t like them, don’t invest with them, and don’t fly with them. Celebrate the fact that you’re able to choose.
I’m sure though, that Ryanair’s shareholders, and Michael O’Leary, will manage fine without your support. And he’ll continue treating his airline, as any good chief executive should, even if he’s not working with all of his own money all of the time, as if it is all his own money. And just like Manchester United being Alex Ferguson’s football team, and the UK’s present government being Tony Blair’s government, Ryanair will continue being Michael O’Leary’s Ryanair, whether you or I split any more semantic hairs on the issue.
Comparing BA and Ryan Air Bristol/Cardiff to Dublin BA is slightly cheaper.
Funky, baby. Fly BA then. It still won’t get BA’s crippling employment figures down much though, where each BA employee has 736 passengers a year, and a Ryanair employee has 8,300.
..and the problem isn’t so much being expected to work 8 hours, but suddenly finding you won’t be working 8 hours because management want to save money and lay you off for the afternoon. There is a fundmental management problem.
Yes, there is. They haven’t got rid of enough staff yet. What’s the phrase they use withing BA management? “Warm bodies out the door”, I believe it is. Expect to see a lot more warm bodies out the doors of BA, before Rod is through.
The alternative is everyone is sacked when the company goes bust, because he hasn’t dealt with the over-manning fiercely enough.
its just I happen to like having some fall back positions when things go wrong, and I rather like my airport to be in the same country as the city I am flying to; “Oslo” Torp is in the same country, but it is 100 km from the city. It’s like calling Birmingham London’s 6th Airport.
Errr….at the risk of repeating myself ad nauseam, don’t fly with Ryanair then, celebrate the fact you don’t have to. Isn’t the free market wonderful! 🙂
If a company never pays dividends, how is owning shares of its stock any different than owning, say, baseball cards? The only way they can give any profit to the investor is if someone else decides to pay more for the shares. Those new investors must, in turn, hope for other investors willing to pay more … etc. Classic pyramid scheme.
But intrinsically, shares which are guaranteed never to pay a dividend have no inherent value at all.
Its that kind of investment strategy which produces huge stock bubbles. The only cash going into the system is from other investors – none at all is coming in from the company itself. Crazy.
What is wrong with a company raising operating capital via an issue of shares, and then returning the profits of the venture to the investors? When did that utterly commonsense and impeachably honest approach become old-fashioned?
Speculating on capital gains on an individual basis is one thing – telling investors that they will never see a penny of profit other than capital gain is something else again.
You’ve obviously got a great deal of anger boiling up there, about Ryanair, and that incident you mentioned. So I repeat, if you don’t like them, don’t invest with them, and don’t fly with them. Celebrate the fact that you’re able to choose.
I think they are a crap airline and don’t fly them.
That’s a side point.
A publically offered company is not the play thing of the majority shareholders nor the board, it is owned by all the shareholders.
If Mr O’Leary doesn’t like this then he ought to be running it privately. Of course, that doesn’t work because he had to go to the market to *borrow* the money to make his airline expand.
BA have a lot of problems with staff – and there are too many people per passenger, OTOH, if and when Ryan Air start flying long haul they are likely to find the staff requirements will also increase.
Its not so long since BA were considered a paragon of free market excellence.
G Cooper writes:
O’Leary may be a shareholder too, even a majority shareholder, but he has chosen to borrow other people’s money. Personally, I wouldn’t lend him a sou.
Hey, Mr Cooper. Long time, no hear 🙂
Now I’m not the hottest investment banker in town (well, in truth, even Monopoly confuses me :), but if you buy a Ryanair share, you’re not lending anybody anything. You’re buying a piece of the action, which always remains 100% in your hands. Ok, for this magic piece of paper, you exchange some cash, but it’s not lending your cash. You will never see that particular lump of cash back again; it just disappears into a BP bill for aviation fuel.
However, someone in the future may be willing to exchange their new outside cash, for your magic piece of paper, which you own. And hopefully for a lot more than you paid for it! $-)
A loan, is well, a loan; a bank loan, or a bond, repayable as per the terms of the loan or the bond.
And as anyone who’s waded through this thread, which is far longer than I ever expected it to be, will know, Ryanair don’t pay dividends (I think a round of applause for Samizdata, for bringing this important information forward :). So if you like dividends, don’t invest with them.
Ryanair need their profits to re-invest in the company, to keep their growth (and share price growth) going. They’ve decided not to fritter it away on dividends, a fact they’re happy, nay overjoyed, to advertise.
If you fancy chancing your arm on high share price growth, do invest with them. And either watch your share price go up, or down, depending on how well Ryanair’s management plays the transport market.
Wish I had some spare money to invest! 🙂
I know im late onto this but I have to comment on the dividend issue.
From the second he went public and took in other shareholders funds he lost the right to ever call it his company. Ego maniacs like him are exactly why dividends should be paid. It is the only way ALL the owners of company benefit. The tax changes in the USA have certainly been the catalyst for companies increasing dividend payouts but they are just reverting to the mean. The average dividend payout in the US over the past 100 years has been 45% of earnings. In the 1990’s it dropped dramatically due to the influence of directors taking advantage of the greatest legalised theft from shareholders in the history of the world – namely share options. Dividends are an absolute must
Dave O’Neill writes:
A publically offered company is not the play thing of the majority shareholders nor the board, it is owned by all the shareholders.
So if I own 51% of Andy Duncan Enterprises, and you own 49%, does this mean I have to ask your permission to do stuff, or can I still do what the hell I want? I’ll do the hell what I want, if it’s all the same, thanks. If you want to come for the ride, great. If not, sell your shares to someone who does.
If Mr O’Leary doesn’t like this then he ought to be running it privately.
Well no, I’d have thought he has to make sure he has 51% shareholder backing? Or did I miss something significant, when I last checked my ‘Idiot’s Guide to Capitalism’?
Of course, that doesn’t work because he had to go to the market to *borrow* the money to make his airline expand.
And as long as he retains 51% shareholder backing control, he’s happy as a sandworm.
BA have a lot of problems with staff – and there are too many people per passenger, OTOH, if and when Ryan Air start flying long haul they are likely to find the staff requirements will also increase.
Long-haul may require more staff (or it may not), but I don’t see Ryanair going from 8,300 passengers, per employee, down to anywhere near 736. Even dropping to 4,000 gives them more than twice as many staff as now, and makes them still nearly five times more efficient than BA.
Its not so long since BA were considered a paragon of free market excellence.
Only compared with their monolith rivals of the time, like Air France.
That’s the thing about the market. It’s always changing, and nobody can ever rest on their laurels. Which is why it’s such a wonderful thing, though why so many people who can’t be ever bothered to change, hate it so much. Poor collectivist work-shy sods.
I hate Ryanair, but I fly it more than any other airline. Why? Because its cheap.
O’Leary treats his customers with contempt but gives ’em a no frills service.
I can fly for the weekend to the maison secondaire for £130 on Ryanair or £400 on Air France.
Hate Stanstead, hate Ryanair. But hate Air France even more.
O’Leary and Ryanair will get their come-uppance when competition nearer their prices but with a little less contempt for the passenger comes in to play.
but if you buy a Ryanair share, you’re not lending anybody anything. You’re buying a piece of the action, which always remains 100% in your hands.
No, I disagree.
There is no reason for a company to go public except it needs more money. Traditionally it is the most effective way of raising cash, ignoring the lunacy of the recent bubble. Historically selling shares is a futures risk which is cheaper than a bank loan.
The key point is though that the *second* you ask an outside person for money in exchange for a *share* of your company, it stops being your company – it becomes your company and, to a small extent, their company.
If you aren’t happy with that, don’t go public.
Andy Duncan writes:
“Now I’m not the hottest investment banker in town (well, in truth, even Monopoly confuses me :), but if you buy a Ryanair share, you’re not lending anybody anything.”
Rats! Bombadil beat me to it…
So if I own 51% of Andy Duncan Enterprises, and you own 49%, does this mean I have to ask your permission to do stuff, or can I still do what the hell I want?
That largely depends on the type of share, your business charter, the requirements of our bank and quite a few other things which are incumbent upon people who run both Limited Liability and Public Ltd Companies.
In practise, as long as we pretty much see eye to eye and business is good, then things are fine and dandy.
If, on the other hand, you get the position that you need to raise more money or dilute the stock, or do something I disagree with vhemently, you might have to, in practise, buy me out or end up getting stung by the banks.
This is the reason why Alan Sugar and Richard Branson ended up buying back the percentages of the their businesses which they had sold.
Raising money through selling shares in your company is a dangerous thing to do.
It’s quite possible to own 80% of a business but have very little control.
Andy,
Why dividends are a good idea:
You buy stock in Ryanair, it pays no dividend, you own 1% of the company.
Michael O’Leary decides to issue more stock in Ryanair to pay for a new ivory back-scratcher, he holds a vote, he has enough votes to carry the day. You now own 0.95% of the company, your stock is worth less too.
Companies issue new stock all the time, if the company pays dividends then you would at least get something.
Steve Bowles writes:
From the second he went public and took in other shareholders funds he lost the right to ever call it his company.
Er..well, mea culpa, that was me actually. He calls himself the largest individual shareholder. And I’m sure that’s exactly what he is.
Ego maniacs like him are exactly why dividends should be paid.
Should this be made compulsory, by the State?
It is the only way ALL the owners of company benefit.
No, all the owners of a company benefit when the share price goes up, in exact proportion to the number of shares they own. Sometimes they also benefit when the company’s profits are not re-invested into the company, but are consumed by the owners in the forms of dividends, after the shareholders decide to do this, in a vote.
The tax changes in the USA have certainly been the catalyst for companies increasing dividend payouts but they are just reverting to the mean.
So it’s good that the State, via various tax changes, should determine the direction of company management investment and reward strategies?
In the 1990’s it dropped dramatically due to the influence of directors taking advantage of the greatest legalised theft from shareholders in the history of the world – namely share options.
This goes beyond my limited knowledge of the market, alas, so I won’t comment except to say all those investors who thought the market could only expand, forever, got a lot of what was coming to them (and I include myself, here, having got burnt quite badly), and those shareholders who never voted in board elections, if they had the chance, have only themselves to blame.
And share options? Never really understood the financing aspects of these, or why shareholders who actually bought their shares, are willing to let employees exercise these rights. Though many companies I contracted for, had many employees who did nothing all day but watch the company share price go up. They didn’t actually do any work. Which is of course a large reason behind why these share prices then came down, to howls of daily horror from the share price gogglers.
In some ways though, you may be right. Does a board of managers, who start out as mere employees, almost become like a surrogate state, feasting off the backs of the serfs who work for them? A separate thread is necessary, I’m sure! 🙂
Dividends are an absolute must
Well, only invest with companies with high dividends then. Disinvest from companies which don’t offer large dividends.
I must say though, I wish I’d had a million Microsoft shares, fifteen years ago, despite their lack of dividends.
And share options? Never really understood the financing aspects of these, or why shareholders who actually bought their shares, are willing to let employees exercise these rights.
Because you could get and lock in employes in a time when recruiting was a pain in the arse.
Once an employee has exercised the right they do own the shares. Options are just another futures gamble. The employee is given the options at a price, say something like 25% below the market rating of the company. They can then hold onto the option or buy at an agreed later stage, usually 25% per year after the 1st year with the business. Once they’ve exercised them and paid the tax, they’re a share holder like everybody else.
Though many companies I contracted for, had many employees who did nothing all day but watch the company share price go up. They didn’t actually do any work. Which is of course a large reason behind why these share prices then came down, to howls of daily horror from the share price gogglers.
They were taking the risk of having part of their salary as an option scheme rather than cash. That’s the market for you 😉
I thought you’d like that.
It works both ways, I know lots of people I meet regualrly in Redmond are multi-millionaires (or at least a handshake away from them) but they still work.
Its much harder to persuade employees to take stock now. My company instead has a profit share scheme which rewards long service and profit. Probably a better incentive.
The market is good for certain things. But I think the history of the stock market demonstrates its not all that good at curbing greed.
I hereby nominate this blog for the slow news of the week award
deirdre thompson writes:
Think you need to read Atlas, because Hank Rearden was a bit of an arse, and he married an idiot, and he was a crap buisness man.
Must’ve been a different book to the one I read. In my alternative Universe Hank Rearden was the greatest producer of steel, and other industrial metals, in the US, and probably North America and the rest of the world. He also had the most innovative products, much stronger and lighter than other alternatives, and he couldn’t make the stuff fast enough. Even with just ordinary steel he was far more productive than any other producer, before we even get to the stuff about Rearden Metal.
As to his business skills, as well as his production skills? He got shafted by the State, but then, aren’t we all? And he lasted longer than virtually anyone else, before they broke him.
As to the marriage thing, yes, I’ve often wondered about his wife. Why did he stay with her? Why did he sleep with Dagny behind her back, rather than just come clean about it, straightaway. I suppose Ayn Rand needed a crucible of conflict, to wrap him in, but it never quite worked for me, the compulsion he had, to stay with his wife. But then the book’s about objectivism, not a Stephen King compulsive yarn. It’s still as much as I can do to wade through Mr Galt’s radio address, without massage relief! 🙂
As for “Dagny Taggart-styled ladies” come on you really think she/they would settle for a Michael O’Leary? when they are men like Conrad Black around.
I thought he was shacked up with Barbara Amiel?
Bombadil writes:
Speculating on capital gains on an individual basis is one thing – telling investors that they will never see a penny of profit other than capital gain is something else again.
Well, don’t invest in Ryanair then.
Dave O’Neill writes:
Raising money through selling shares in your company is a dangerous thing to do. It’s quite possible to own 80% of a business but have very little control.
I profess no detailed knowledge of the complex regulatory framework set up within the City of London, and other similar bodies, so I’ll have to bow to your greater experience and knowledge here. I do remember Beardy Branson complaining that going public meant he had to declare rigorous accounts, and let his outside shareholders know all of his plans. Which didn’t suit him, at all! 🙂
If I had a larger company than I do, I think I’d keep it all private, like the bloke who owns SAS, and so on, but it seems it gets very difficult as you get larger, and need money without repayment strings, and need to motivate your employees, for which shares seem to be the ideal solution, or seemed the ideal solution before the Big IT and Networking crash.
Della writes:
Michael O’Leary decides to issue more stock in Ryanair to pay for a new ivory back-scratcher, he holds a vote, he has enough votes to carry the day. You now own 0.95% of the company, your stock is worth less too.
Well, don’t invest in Ryanair then.
Dave O’Neill writes:
Because you could get and lock in employes in a time when recruiting was a pain in the arse.
Ah yes, the happy days of contracting, when the only way for rates, was up! $-
They were taking the risk of having part of their salary as an option scheme rather than cash. That’s the market for you 😉
🙂
I’m not going to pull this thread, because it’s raised some really interesting debate, but maybe you might want to continue any discussion on this thread.
Natalie’s got me bang to rights. Ah, the slings and arrows of outrageous fortune.
Henry Reardon is an archetype, as are many of Rand’s characters. Whenever I read a review or comment about her novels, Atlas Shrugged especially, in which the reviewer starts talking about the stiffness of her characters, I know I’m dealing with someone who doesn’t get the point.
Reardon is the typical businessman (in Rand’s universe), i.e., he is very productive, demands the highest integrity, effort, committment, etc., in his business dealings, but is a victim of modern ethics and religious belief, so is guilty because he never really feels all those “altruistic” feelings and never shares the “higher spiritual states” that so many of his critics, his wife included, always talk about.
He married his wife because she was the type of woman he thought he should marry. He puts up with the constant putdowns and other snide criticisms because he doesn’t understand what is actually going on. He thinks intellectualism and philosophy are useless and meaningless for him in his main pursuit—the production of better metals.
Reardon accepts misery in his personal life because he knows he is not “good” in the Albert Schweitzer selfless humanitarian model of the time, and therefore has no right to ever be happy.
He has an affair with Dagny because he has finally found a woman whom he can value as an equal. Love and passion to Rand are exchanges of recognized valuation between equals. He allows himself to be made happy, and finally is taught that he has a right to be happy on his own terms.
The Galt speech referred to is the whole point of the book. It is the explication of a mode of thought which allows happiness for oneself instead of for others.
The reason for stock options was federal legislation limiting executive compensation. When the Enron/Worldcom/whatever business came up, the dem author of the legislation was questioned about his law causing the trouble and went ballistic.
I have very little time for big shots of any kind, but this was a classic case of warping the playing field, and then complaining because someone found a way around the rule that was worse than what was being solved by the law in the first place.
Why is everyone so struck with Ayn Rand?
She always struck me as intellectually unoriginal, scoring more as a talented self-publicist than a thinker or a (fairly clunky) writer. Being a young woman Russian emigre in the US who gets the idea of telling millionaires that their very richness and self-love is the ultimate service to the community is pretty shrewd career development, granted, but her inclusion in the pantheon of political theorists always puzzled me a bit.
Or am I just being a bit of a snob?
you’re not a snob. You just don’t get what she was talking about.
If I had a larger company than I do, I think I’d keep it all private, like the bloke who owns SAS, and so on, but it seems it gets very difficult as you get larger, and need money without repayment strings,
This is the crux of my problem with O’Leary’s pronouncements. He wanted the money, and he’s a grown up enough business man, I assume, to know what that entails.
He should be grateful he didn’t need or use Venture Capital or he might have found just how little being the single largest shareholder means when somebody else has preferential shares!
As long as you are happy to run a pucblically listed company it is a great system and the market will reward you. Sounds to me, however, like O’Leary has been reading too much about the cult of the CEO and books by Jack Welsh.
As long as the share price increases dramatically he’s safe. The second that stops happening, he may find the shareholders have short memories.
Mark writes:
Why is everyone so struck with Ayn Rand?
Well I can only speak for myself, but because she articulates and throws into sharp clear relief, many of the conceptual and intellectual ideas inherent within statehood, and its cheerleader, collectivism. Providing this platform, and scaffolding, this then enables many of us to go much higher, than we previously otherwise could, in our appreciation of other writers, such as Popper, Von Mises, and Rothbard.
And let’s face it, after wading through ‘Objective Knowledge’, ‘Human Action’, and ‘Man, Economy, and State’, it’s nice to get some fictional relief, even if sometimes it is a little clunky. Though P.J.O’Rourke’s ‘Eat the Rich’ is also good fun! 🙂
BTW, have you ever read Rand’s ‘Anthem’? Now that really is a good book, beautifully written and observed, and my favourite of her fictional books. And if you haven’t read it, you’ll be pleased to hear its very short (always a plus, IMHO).
And also I think she articulated, better than any other writer, the rise of the ‘New Left’ of eco-warriors, feminists, and the PC class, in her non-fiction book, ‘Return of the Primitive: The Anti-Industrial Revolution’. Buy it. Immediately! 😎
I sometimes struggle to accept her method of writing fiction, which is to plot everything, in order to ‘objectivize’ it. Which is why I think she sometimes gets a bit clunky. I’m more of a Stephen King man, write as you go to a vague general plan, uncovering an interesting idea, to keep some spontaneity. But when I’ve sold as many books of Rand has, I’ll be better qualified to comment.
Also, ‘Atlas Shrugged’ is not strictly a fiction book. It’s more a non-fictional book about her philosophy, Objectivism, written in disguise. As such, she can’t take the easy options, such as cutting out chapters which don’t flow in a purely fictional context. She has to get the whole mother in. Which I suppose is why it took her so long to write it. In my view though, it is a triumph, an original work of breathtaking scope, and just like other seminal books, such as Nineteen-Eighty-Four, a book leftists should read, and then try to refute, if they’re able.
I’ve also lent my copy of ‘Fountainhead’ to several friends, and each time, it comes back in almost stunned silence, and they want to know what to get next. So I suppose you either ‘get’ Rand, or you don’t. I’m sure she would say, that that’s your prerogative.
Thanks veryretired and Andy, I guess Rand does play a major role. Perhaps I’m a snob too!
I should be the first to admit I have only glanced at Rand’s books. So though my instinct is to say her adroit skill at being charismatic around very rich men is more interesting than her books, I have not read enough of her to judge, to be honest.
An interesting anti-collectivist dytopia I can recommend from the 1950s is ‘One’, a novel my mother in Yorkshire has (hard to find on Amazon, since I forget the author’s name) about a blandly familiar near future where the extraordinary Inquisitor Larch yearns to reform one last heretic, a middle-aged English Lit academic who does not even realise he is disloyal to the regime. For my money, Larch is a much more memorable interrogator than 1984’s O’Brien.