““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”
Sociologists talk about how societies throughout history have had varying tolerance for disparities of wealth. That is, the degree to which the economic gap can expand before the unwashed masses rise up and take down the well-scrubbed wealthy few. Think Marie Antoinette and the French Revolution. Fair or not, private jet travel ranks high on the list of activities that many people associate with excess wealth. So as a business jet traveler, do you feel that this part of your lifestyle is offensive to your less-fortunate fellow man? And if not, how would you address the perception of excess? Or would you?
Fewer than 5 percent of American households earn more than $180,000 per year. And frankly, it's a stretch to imagine anyone financing regular private jet travel on that low an income. So those with the means to fly privately are at the extreme pointy end of the earning pyramid. At the other end, the number of Americans living in poverty rose to 43.6 million in 2009-the highest figure in 51 years of recordkeeping. So the gap is widening. And while poor Americans may not exactly be honing their guillotines, there is some sharp rhetoric out there among advocates for the "little guy" condemning the lifestyles of what constitutes economic royalty in this society.
The longer the state of the middle and lower classes remains dire, the louder the public outcry against the wealthy. And it comes from both sides of the political landscape. Tea Party advocates condemn "Learjet liberals" while those on the left become less and less tolerant of the carbon footprints left behind by corporate jets. Logical arguments on both sides get lost in the swirl of emotion. And 24-hour "news" stations encamped on both sides of the political aisle are financially motivated to stir the pot, further dimming hopes for a civil discussion. They appeal to people's anger to get them to tune in, and psychology tells us that when the emotional areas of the brain are stimulated, the rational parts go into remission.
There are those who openly aspire to being seen alighting from a private jet. In their case, achieving greater fame-whatever the means-is often an avenue to augmenting their fortunes. But most users of private aviation face a public relations challenge. They want or need the convenience and security of flying privately, but the image of living to excess can be damaging. The fact that Al Gore purchases carbon offsets whenever he flies privately doesn't even cause a speed bump for those who publicly delight in the irony of Mr. Global Warming spewing jet exhaust. And who can forget the debacle of the Big Three automakers and their private flights to Washington in search of bailout money? Such fiascos are just too delicious for headline writers to resist sinking their teeth into.
It's fascinating that Warren Buffett, who has cultivated a "regular guy" image, openly endorses the private-aviation industry. True, his corporation owns two major bizav companies, fractional-ownership pioneer NetJets and training specialist FlightSafety International. But the apparent contradiction in Buffett acknowledging the advantages of his private flying so publicly is a refreshing dose of frankness among those so privileged. And so far, it hasn't brought mobs of angry peasants to his modest front lawn in Omaha.
But most companies and individuals who fly privately seem to try to do so under the radar. That doesn't mean bizav is indefensible, of course, but it may mean its users need to learn how to defend it. Perhaps they should consider a comparison of "private" flying and "private" driving: Could the average American family get by without a car or two or three? There are countries and cultures today that view owning an automobile as a symbol of excess wealth and ecological irresponsibility. Sound familiar?
Isn't it all just a matter of scale?