HIGHTOWER: The Merger Game
Step right up folks [Carney music] and take your chances on the "Megamerger Deal-Wheel." It's a game where corporate executives waste billions of dollars in investment capital buying each other's companies, then close down local factories or branches, fire thousands of employees, raise prices to consumers, and put billions of dollars in inflated stock values in their own pockets. It would make a flim-flam artist blush, but it's all rationalized as "economic progress."Take my local phone company ... please! I'm a customer of SBC Inc. -- and you probably will be, too. It has long controlled phone service in Texas and four other states. But last year, it took over Pacific Telesis, giving it control of local phones in California and Nevada. This year, it has grabbed Ameritech, giving it five more states in the upper-Midwest. Now there's talk of it merging with US West, giving SBC 17 western states and control of local service everywhere in America outside the deep South and the Northeast.I just got my bill from this leviathan, and its new slogan is: "Your friendly neighborhood global communications company." I kid you not! If SBC Inc. is so friendly, why does it keep raising my rates at the same time it claims that its mergers make it more efficient?The truth is that these mergers have nothing to do with efficiency and everything to do with efficiency and everything to do with greed. Big shareholders make a killing as a result of these mergers, investment bankers get fat on fees, and CEOs make millions from their stock options. For example, on the recent SBC takeover of Ameritech, the CEO of Ameritech personally can walk away from the deal with $44.6 million.This is Jim Hightower saying . . . [Carney music] When that "Megamerger Deal-Wheel" starts spinning it's the elites at the top who get the goldmine . . . while the rest of us get the shaft.
