Trump: I Ran a Great Airline: Exclusive

By Ted Reed05/05/11 - 10:45 AM EDT

NEW YORK (TheStreet) -- During a year and a half in the airline business, Donald Trump leveraged up too much, defaulted on his loans, fired the airline's president and then wouldn't make good on the president's contract.

He also improved the property, won praise from the employees and made a little money. "It worked out well for me," Trump said in an interview with TheStreet. "I ran an airline for a couple of years and made a couple of bucks. The airline business is a tough business, [but] I did great with it."

With Trump considering a bid for president, it may be timely to review his stewardship of the shuttle, which he purchased from Eastern Airlines in May 1989 for $365 million, branding it with his name and seeking to bring a luxury to a largely utilitarian segment of the airline business that provided convenient, hourly service in two key markets: New York's LaGuardia/Washington National and LaGuardia/Boston.

In particular, Trump recalls the positive relations with Trump Shuttle employees, many of whom embraced him after moving over from Eastern Air Lines, which had an acerbic labor climate and rundown equipment and facilities. "I was tentative about it at first, but i ended up with some of the finest employees," Trump said. "They worked as hard as any employees I ever had, because they wanted to prove that what was said about them was not true.

"Even today, I sometimes hop on the shuttle, or on a plane back from Florida, and there are people who say 'Thank you, Mr. Trump, for the great job you did at the shuttle.'"

The positive view of Trump was not universal. "Donald was challenging," recalled Bruce Nobles, president of the Trump Shuttle from October 1988 until June 1990. "Like a lot of charismatic entrepreneurs, he tended to be intimately involved in a lot of the details, [although] he didn't interfere in the operations per se. He didn't really know much about the airline business.

"When I first met him, I told him that old joke about how the way to make a little money in the airline business is to start with a lot of money, and he thought I was kidding," Nobles said.

In fact, despite the industry wisdom, the late 1980s and early 1990s were a time when airlines, for some strange reason, were viewed by many as trophy investments. Even Warren Buffet bought in, later declaring that his US Airways (LCC_) investment was his biggest mistake. Trump's own airline itch intensified after the shuttle purchase. In August, 1989, the Miami Herald reported that Frank Lorenzo had several times solicited Trump to buy Continental. In October, Trump bid $7 billion or $120 a share for American Airlines(AMR_).

BA-Iberia Swing to Profit in First Quarter Following Merger

British Airways Plc Chief Executive Officer Willie Walsh. Photographer: Jason Alden/Bloomberg

By Steve Rothwell - May 6, 2011 3:41 AM ET

International Consolidated Airlines Group SA, formed from a merger of British Airways and Iberia on Jan. 24, logged a profit in its first quarter of operations, beating predictions, as traffic rose and the deal cut costs.

IAG posted net income of 33 million euros ($48 million) in the three months ended March 31, versus a pro forma loss of 243 million euros a year earlier, the London-based company said in a statement. Analysts had forecast a loss of 138.5 million euros.

Traffic advanced 5.6 percent in the quarter, led by an 18 percent jump in premium bookings in March that buoyed ticket prices and helped lift sales 15 percent to 3.64 billion euros. IAG also cut non-fuel expenses 5.2 percent in the three months, and earnings were swollen by an 80 million-euro tax credit.

“The trends that we’ve been seeing, with good premium volumes and yields, particularly in long-haul, will continue through the summer,” Chief Executive Officer Willie Walsh said on a conference call, predicting “significant growth” in operating profit for the full year. “We have also achieved a significant reduction in our controllable costs.”

IAG rose as much as 3.7 percent to 255 pence and was priced at 253 pence as of 8:20 a.m. in London, reducing the stock’s decline since the merger to 12 percent and valuing Europe’s third-biggest airline at 4.69 billion pounds ($7.7 billion).

Earnings equated to 1.7 cents a share, compared with a loss of 13.2 cents a year earlier. Sales also beat the 3.56 billion- euro average estimate of nine analysts surveyed by Bloomberg.

Strong Trend

“The trends are still good in premium traffic and that’s where the money is, though fuel prices are still very high,” said Gert Zonneveld an analyst at Panmure Gordon in London.

Premium yields, a measure of ticket prices, rose 4.4 percent in the quarter even as volumes rose almost 12 percent.

“They are still benefitting from the big post-recession recovery in yields, but that’s a factor that has started to run its course,” said Douglas McNeill, an analyst at Charles Stanley in London with a “hold” recommendation on IAG. “Increasingly, the focus will be on the hard graft of reducing unit costs.”

The price of oil has surged 20 percent in the past six months, prompting British Airways to lift a fuel surcharge three times since December, though the levy passes on only 50 percent of the cost and hasn’t so far hurt bookings, according to Walsh.

“All of the indications that we have seen is that it hasn’t had any discernable impact on demand,” said the CEO, who previously led BA. “That’s true of both premium and non-premium cabins, but clearly it’s something that we are looking at.”

April Surge

Traffic surged almost 25 percent in April, IAG said separately, after flights last year were disrupted by ash from a volcanic eruption in Iceland. First- and business-class bookings leapt 40 percent and economy demand advanced 22 percent.

Walsh said capacity increases at British Airways and Madrid- based Iberia were “appropriate” in the light of summer bookings that are “looking good.” The carriers have flexibility to curb seating if need be, he said.

To contact the reporter on this story: Steven Rothwell in London at srothwell@bloomberg.net

To contact the editor responsible for this story: Chad Thomas at cthomas16@bloomberg.net

Abel Harding: Jacksonville's entangled in 2012 hullabaloo

Submitted by Abel Harding on May 6, 2011 - 1:54amPolitiJax

In print: May 6, 2011

One campaign argues it's all about 2012; the other says it's not. Behind the scenes, there's no question some of the supporters involved in both of Jacksonville's mayoral campaigns are looking ahead to the next game.

For proof, look no further than Florida's two U.S. senators. They've weighed in along party lines, with Bill Nelson backing Alvin Brown and Marco Rubio supporting Mike Hogan.

The parties are also very involved. Republicans have pledged at least $100,000 to Hogan. The Florida Democratic Party has now covered bills in excess of $313,000 for Brown.

Activists obviously see Jacksonville as crucial to the next presidential election. That's despite the fact that the presence of a Republican in City Hall and in the governor's mansion failed to deliver Florida for the GOP in 2008.

So what's all of the hullabaloo about? Simply put, for activists outside the city, it's bragging rights.

Think of it as the 2010 Florida-Georgia game. A victory ultimately meant nothing, but it did give a certain columnist a week to crow about the win to a Bulldogs-fan brother.

In all seriousness, the injection of national politics demonstrates the entrenchment of the two-party system. Local issues may not be partisan - and there is a strong argument to be made that they aren't - but both candidates have a track record of loyalty to their respective parties.

And for voters who subscribe to a specific philosophy, there's a reluctance to differ with their preferred party, even when core principles may not be at stake.

Hogan's legislative voting record shows a willingness to align himself with the leadership of his party, something he's never denied.

Brown has never cast a vote as an elected official and touts his bipartisanship, but his track record of donations - checks in excess of $50,000 over the past 16 years - indicate a definitive preference for Democrats. Only one of his contribution went to a Republican, according to opensecrets.org.

With the drumbeat of national issues holding sway, conversations about Jacksonville's quality of life, its levels of taxation and the future of its public schools have been drowned out. For voters, that's an unfortunate occurrence.

Elections overhaul en route to governor

by Dara Kam | May 5th, 2011

An elections overhaul likely to wind up in court that would cut nearly in half the number of days for early voting and impose tougher restrictions on groups registering voters is headed to Gov. Rick Scott.

The GOP-dominated legislature easily pushed through the elections revamp over the objections of Democrats who argued the bill will make it harder for Floridians to vote and get their ballots counted.

The 157-page elections measure will reduce the number of days available for early voting from 14 to 8 but keep the same number of hours – 96 – and allow supervisors of elections to extend weekend hours.

Palm Beach County elections supervisor Susan Bucher estimated the early voting changes would cost her office more than $941 million to secure additional polling places, equipment and salaries.

The overhaul make it tougher for like the League of Women Voters, labor unions and the NAACP to sign up prospective voters by requiring them to register with the state, give voter registration forms to elections supervisors within 48 hours or face $1,000 fines, among other things.

Republicans said the changes are aimed at reducing voter fraud although fraudulent ballots have become a rarity in recent years thanks to past reforms including the creation of a statewide voter database.

“The fact is there’s a lot of bad actors out there and there’s an opportunity currently to game the system,” said Sen. Miguel Diaz de la Portilla, the Miami Republican carrying the proposal (HB 1355).

But Democrats argue the changes are aimed at suppressing Democratic voter turnout in 2012 because Democrats tend to use early voting more than Republicans and relied heavily on third-party groups to register voters in the 2008 presidential election.

“This is just a mean-spirited attempt to disenfranchise Democratic-leaning voters,” said Rep. Franklin Sands, D-Weston.

The bill would also eliminate a long-standing provision that allows people to change their address or name at the polls. Under the bill, voters who want to change their registration on Election Day will have to cast provisional ballots, which Democrats contend have a higher percentage of not being counted.

Critics say that will make it harder for college students who flocked to the polls in 2008 to vote in future elections.

“The hope is that those college students who are likely to be the most affected by this, their votes won’t count,” said Rep. Richard Steinberg, D-St. Petersburg.

But Sen. Mike Bennett, a Vietnam veteran, said that voting is too easy and voters have a responsibility to be prepared.
“How much more convenient do you want to make it? You want to go to the house? Take the polling booth with us?” Bennett, R-Bradenton, said. “I wouldn’t have any problem making it harder. I would want them to vote as badly as I want to vote. I want the people of the state of Florida to want to vote as bad as that person in Africa who’s willing to walk 200 miles…This should not be easy.”

Union leaders Thursday morning advised Senate Democrats to question the measure during floor debate to pave the way for lawsuits.

“The questions you ask lays the basis and foundation for the challenges on this,” Florida AFL-CIO president Mike Williams advised the Senate Democratic caucus this morning.

The Senate approved the measure by a 25-13 vote with two Republicans joining Democrats in opposition. The House passed it with a partisan 77-38 vote late Thursday.

Scott is expected to sign it into law.

Energized Jacksonville electorate flood early-voting sites to cast mayoral ballots

Mayoral showdown gets many people out to cast their ballots early.

Posted: May 6, 2011 - 12:00am

By Jim Schoettler, Timothy J. Gibbons

If current trends continue, by the beginning of next week more early and absentee votes will be cast in Jacksonville's runoff election than were submitted during the entire two-week early-voting period before the city's first municipal election in March.

At the end of the fourth day of early voting Thursday, 27,522 ballots had been cast, up about 85 percent from the last election.

Absentee ballots are up 89 percent; early votes are up 80 percent. Voting at early polling places in the Gateway, Regency and Highland areas have more than doubled.

"What you're seeing now is the supporters going out and following through with their votes," said Supervisor of Elections Jerry Holland. "They're not going to change their mind."

The first election, which featured six candidates vying for the mayor's seat plus a host of other races, saw fewer than 30 percent of registered voters participating. The low turnout, combined with the ability of Alvin Brown and Mike Hogan to energize their bases, set up the confrontation that will be decided May 17.

Of the 152,505 votes cast in the first election, 43,074 came in before Election Day.

It's unclear who benefits from high turnout this time: Both votes cast at early polling places, which traditionally favor Democrats, and absentee votes, which break Republican, have seen a surge.

Hogan pollster John Libby said his candidate has done well in areas where he has traditionally run strong and picked up support in the first election; and some areas that would likely favor Brown also have shown an uptick.

"I'm very encouraged where we're sitting in terms of the ratios and knowing some of the demographics," Libby said. "But it's a long way from being over."

Brown's campaign saw the surge as an indication that its message is getting through. "It's a testimony to the strength and endurance of Alvin Brown," said his campaign manager, Craig Kirby.

Voters are now paying attention to the race, Kirby said, and are faced with a clear choice as to who to support.

Narrowing the mayoral field helps raise the interest level of voters, said Stephen Baker, professor of political science at Jacksonville University.

"The fact that you have only two candidates per race means people can focus on them more easily," he said. "There's a tendency to postpone the decision with more candidates. Now, there should be fewer undecideds."

Whatever the reason for the surge at the polls, Holland said, it's not likely to end before Election Day.

"I think we'll see more interest," he said. "It's a good thing people are getting engaged in this."

timothy.gibbons@jacksonville.com, (904) 359-4103

jim.schoettler@jacksonville.com, (904) 359-4385

Walker Strikes Again: Signs Repeal of Milwaukee Paid Sick Days Law

by Mike Hall, May 5, 2011

Paying back his corporate donors and allies and sticking it to working families once again, Wisconsin Gov. Scott Walker (R) signed a bill that overturns Milwaukee’s paid sick leave law.

The law was passed with a 70 percent vote in 2008 and Milwaukee corporate interests soon filed suit against it, but in late March, the Wisconsin Court of Appeals upheld the law. Today, Walker went to the headquarters of the Metropolitan Milwaukee Association of Commerce (MMAC), the business group that tried to block the law, and signed the bill that preempts all Wisconsin communities from approving ordinances requiring paid sick days.

The bill was passed at the urging of the MMAC by the Republican-controlled legislature and specifically designed to block the Milwaukee law. Dana Schultz, lead organizer for 9to5, the National Association of Working Women, says Walker’s action is “an assault on democracy, local control, and working families.”

Voters can see that the governor and state legislature are more committed to paying back their corporate donors than creating good jobs for Wisconsin.

Milwaukee Area Labor Council President Shelia Cochran says state government should be working “for the people that elected them, not for a narrow group of corporate interests.”

The governor and his associates have disregarded the will of the voters, the decision of the court and opened the door to reverse local control wherever they see fit.

Walker’s action comes just days after he cynically announced a program to recognize state employees for their hard work—the same workers whose collective bargaining rights he stripped—and after he appointed a union-busting attorney to head the Wisconsin Employment Relations Commission.

Here’s a scary question. Who’s his next target?

Training is Sign of Better Day in Tomato Fields

Lucas Benitez of the CIW, left, and Reggie Brown of the Florida Tomato Growers Exchange sign the historic agreement last November, as Gerardo Reyes of the CIW looks on.

by James Parks, May 5, 2011

“It’s like a time machine has suddenly whisked us from a Charles Dickens workhouse to an auto plant in the 21st century. The difference in attitude is that great.” That’s how one tomato worker, a member of the Coalition of Immokalee Workers (CIW), reacted to a new training session for employees of Pacific Tomato Growers.

In the training, the first-ever of its kind, workers who pick tomatoes learned they are entitled to a minimum wage and breaks, what constitutes a full bucket of tomatoes and what to do if they have a complaint.

Writing for the Atlantic, Barry Estabrook, former contributing editor for Gourmet magazine, says the training is one of the first results of the historic agreement reached last November between the Florida Tomato Growers Exchange (FTGE) and CIW.

The agreement is taking effect in two stages. This growing season (2010-2011), all participating FTGE members will pay a penny more per pound for the tomatoes picked. At the same time, CIW and two growers, Six L’s and Pacific Tomato Growers, will hammer out a process for enforcing the code of conduct throughout the industry. The code will apply only to Six L’s and Pacific this season. Even though it does not go into full effect until the 2011-2012 season, the agreement already has had a lasting impact on the tomato industry.

Check out the article “Tomato Schools: Undoing the Evils of the Fields” here.

Corporate Profits Soar 81 Percent but Few Jobs Created

by Tula Connell, May 5, 2011

On the eve of tomorrow’s unemployment report for April, we get this news from Fortune:

Profits of the 500 largest U.S. corporations soar by 81 percent ($318 billion), the third largest percentage gain in list history…Wal-Mart holds the number one spot for the second year in a row…Exxon Mobil leads profits with $30 billion, for the eighth year in row.

The stunning leap in profits is so excessive even Fortune writers are writhing in their leather chairs:

We’ve rarely seen such a stark gulf between the fortunes of the 500 and those of ordinary Americans….The profits derived partly from productivity gains, including workforce reductions. And many 500 companies are growing faster overseas than in the U.S.

Here’s the full list of the top moneymakers: http://bit.ly/mnrPsI.

So what are Wall Street CEOs doing?

Screaming for more tax breaks. Listen to them holler about how the United States has one of the highest corporate tax rates in the world. And then read on to see why these corporations actually pay less—if anything—in corporate taxes than their counterparts in other nations. From the New York Times:

By taking advantage of myriad breaks and loopholes that other countries generally do not offer, United States corporations pay only slightly more on average than their counterparts in other industrial countries. And some American corporations use aggressive strategies to pay less—often far less—than their competitors abroad and at home. A Government Accountability Office study released in 2008 found that 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied.

As our Executive PayWatch site points out, U.S. corporations held a record $1.93 trillion in cash on their balance sheets in 2010.

But they are not investing to expand their companies, grow the real economy or create good middle-class jobs. Corporate CEOs are literally hoarding their company’s cash—except when it comes to their own paychecks.

Something to think about, because even if tomorrow’s job report shows improvement in the number of unemployed workers, more than 25 million will still be unemployed or underemployed.

Mine Execs Want to Police Themselves on Safety

by Mike Hall, May 5, 2011

The day after federal mine safety officials announced a series of “outrageous” safety violations at a Massey Energy West Virginia coal mine, mining industry officials were on Capitol Hill calling for fewer federal inspections and a voluntary safety program.

At the hearing before the Education and Workforce’s Workforce Protections Subcommittee, the Republican majority allowed just one worker’s witness, Mine Workers (UMWA) President Cecil Roberts, while three mine industry executives testified. Said Roberts:

The disaster at Upper Big Branch, as well as the other deaths and illnesses that continue to plague the mining industry make it clear that Congress must do more to protect miners. Operators should be required to make better efforts to prevent illnesses and injuries in the first place. After all, the mining industry has shown time and time again it is not very effective at self-policing.

Roberts said the Mine Safety and Health Administration (MSHA) needs more enforcement tools, not fewer. He called for stronger safety rules, frequent and unannounced inspections and tougher penalties. (Click here for his full testimony.)

But Anthony Bumbico, vice president of Arch Minerals, the nation’s second largest coal company, lobbied for a voluntary approach to safety, patterned after an OSHA program known as the Voluntary Protection Program (VPP).

The Charleston Gazette’s Ken Ward points out on his Coal Tattoo blog, “It’s worth remembering that most coal-mine deaths are the result of mine operators violating long established safety laws and regulations.”

He writes that the mining industry has been pushing for a voluntary approach, “basically eliminating MSHA” for years, and that the employer-based program was “a pet project” for Bush administration MSHA chief Dave Lauriski.

something to either do away with required quarterly inspections or to create a program for “focused inspections” of only the mines with the worst previous safety performance. The National Mining Association, oddly enough, pushed for this previously just two months after the Sago disaster back in March 2006.

Backdropping the hearing was MSHA’s announcement Tuesday that it had issued 20 withdrawal orders and five citations following a surprise “impact” inspection at a Boone County, W.Va., mine owned by Massey, not far from the Upper Big Branch mine where 29 miners died in an explosion last year. MSHA chief Joe Main says:

The conduct and behavior exhibited when we caught the mine operator by surprise is nothing short of outrageous. Despite the tragedy at Upper Big Branch last year, and all our efforts to bring mine operators into compliance, some still aren’t getting it. The conditions observed at Randolph Mine place miners at serious risk to the threat of fire, explosion and black lung. Yet, MSHA inspectors can’t be at every mine every day. Our continuing challenge is counteracting the egregious behavior of certain mine operators.

NDP Makes Major Gains in Canadian Elections

Thu. May 05, 2011

The strongly pro-working family New Democratic Party (NDP) made Canadian history when Canadians elected 102 NDP members of Parliament in the May 2, 2011 federal election. When the last Parliament dissolved, the NDP had 36 seats.

The NDP picked up 58 seats in Quebec, including that of Bloc Leader Gilles Duceppe. Before the election, the party had a single seat in Montréal, held by NDP finance critic Tom Mulcair.

“We heard the Quebeckers message of change and hope,” said NDP leader Jack Layton. “They expressed it very clearly so that we won’t be able to forget it.” Layton pledged to try to make parliament work “I will propose constructive solutions focused on helping all Canadians,” he said.

“The challenge to our Canadian IAM members and their families is to stay involved,” said IAM Canadian General Vice President Dave Ritchie. “We have 102 members in Ottawa, including 66 rookies who are going to be your voice in Parliament. I encourage our members to get acquainted with these MPs, share your ideas and concerns with them and, above all, give them your support.”