Power Sheet – October 5, 2015
Two big leadership stories to watch in the coming week, each meriting its own superlative:
-Fighting for the worst leadership job in Washington, representatives Kevin McCarthy of California, Jason Chaffetz of Utah, and Daniel Webster of Florida will seek the votes of fellow House Republicans on Thursday in an election to replace Speaker John Boehner, who’s resigning at the end of the month. The big question, which none of them has answered, is how each would be able to achieve anything Boehner didn’t, or how each would resolve the conflicts that led Boehner to bail. Indeed, this election centers on the intractable reality that pushed Boehner out: The most conservative Republicans can’t get their fondest legislative wishes so long as a Democrat is in the White House, meaning the Speaker can either try to please his numerous and vocal conservative members, or try to pass legislation that might actually become law, but not both. McCarthy is the presumably Boehner-like centrist, while Chaffetz is a conservative challenger; Webster apparently hasn’t achieved sufficient stature to have a chance.
The Thursday vote is among Republicans only and does not officially choose the Speaker, a procedural fact that is the basis of Chaffez’s long-shot challenge, announced yesterday. The vote this week is a secret ballot, which McCarthy will likely win, but what counts is an open vote of the entire House later this month. Chaffetz is betting that many conservative members who vote for McCarthy in private won’t be willing to do so on the record, and he won’t get a majority.
Chaffetz’s theory probably won’t work out well enough to deny McCarthy the speaker’s gavel, and who knows, he could achieve greatness. A seemingly impossible job can be a great leadership opportunity. But sometimes it really is an impossible job.
-The most clueless leader of the past month is FIFA president Sepp Blatter. Four of FIFA’s biggest sponsors – Coca-Cola, McDonald’s, Visa, and Anheuser-Busch InBev – on Friday called publicly for him to resign “immediately.” You might suppose that when four mammoth customers say it’s time to go, it’s time to go. But Blatter said through his lawyer that he won’t resign. He’s holding to his plan, announced in June soon after the current corruption scandal began to unfold, that he would step down next February. When Switzerland’s attorney general announced in late September that Blatter was under criminal investigation, the sponsors apparently decided their brands were being endangered.
I wonder if it’s significant that while three of the four sponsor companies are American (A-B InBev is Belgian), three of their four CEOs are not. Coke’s Muhtar Kent is Turkish; McDonald’s Steve Esterbrook is British; and Anheuser-Busch InBev’s Carlos Brito is Brazilian. Better than any American, they may understand in their bones the global power of soccer, and the danger of its being seen as corrupt.
What We're Reading Today
Bernanke: More bankers should have gone to jail
The former Federal Reserve Chairman looked back at the efforts to stave off a depression in 2008 in an interview about his new memoir Courage to Act. Ben Bernanke said it would have been his choice to investigate individual executives' actions, not just punish what "an abstract firm" did. USA Today
American Apparel files for bankruptcy
No layoffs were announced in the filing, and the deal would let the retailer keep its 130 U.S. stores open. It's been a long time coming for American Apparel, which has struggled under heavy debt for years while a battle with founder Dov Charney makes its way through courts. NYT
Volkswagen to hold extraordinary board meeting
At the meeting on Wednesday, CFO Hans Dieter Poetsch is expected to be named Chairman. The board will also discuss the findings of an internal investigation into the rigging of diesel engine emissions tests, which has already led to the suspension of 10 senior managers. Reuters
Carly finding fundraisers
Conservative fundraisers, including the Koch brothers, have warmed to Carly Fiorina's presidential hopes. Fiorina, along with Marco Rubio, is now on the short list to win the $1-billion war chest Charles and David Koch will provide to one candidate. T. Boone Pickens and venture capitalist Tom Perkins have also committed to raising funds for Fiorina. Fortune
Building a Better Leader
Go ahead and fish for that compliment
Those who receive praise from friends, family, and coworkers are more resilient to stress and burnout, says a new study. They were also better at creative problem solving. Quartz
Don't doom that big idea...
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Three scientists win Nobel in medicine
Their discoveries helped fight parasitic diseases, which affect millions of people a year. NYT
Employee protest breaks up management meeting
As Air France managers discussed mass job cuts on Monday, protesters stormed the meeting, forcing attendees to flee. CEO Frederic Gagey had already left, but human resources and labor relations chief Xavier Broseta was reportedly "jostled" and had his shirt ripped off. Reuters
Activist hedge fund bets large on GE
Nelson Peltz's $13-billion fund Trian has invested $2.5 billion in General Electric. The disclosure pressures CEO Jeffrey Immelt to succeed in transitioning GE into a industrial infrastructure company. Atypically for Peltz, he's not demanding a seat on the board and is supporting management. CNBC
Steve Jobs allies fight new film
Led by Jobs's widow, Laurene Powell Jobs, they argue the movie, Steve Jobs, downplays the Apple founder's accomplishments. Longtime Apple board member Bill Campbell and CEO Tim Cook have also criticized the film. WSJ
Up or Out
As expected, Twitter named Jack Dorsey its permanent CEO on Monday. Dorsey stepped into the role on an interim basis in June when then-CEO Dick Costolo resigned. By taking over, Dorsey has relinquished his chairman position, which he held since 2008. He will continue to serve as CEO of payment processor Square. WSJ
Fortune Reads and Videos
Disney may change park pricing...
...for the first time in 60 years. It would link the price of tickets to demand, so they could be lower during non-peak months or much higher at other times of the year. Fortune
16 EU countries opt out of GMO crops
More could follow the moves by Scotland, Germany, Italy, and others saying they don't want to grow genetically modified plants from companies such as Monsanto and Dow. Fortune
Alphabet drops famous "Don't be Evil" motto
Instead, Google's parent company asks its employees to "do the right thing." Fortune
Donald Trump takes heat for a tax plan...
...that would reduce his own taxes. Fortune
"It would have been my preference to have more investigation of individual action, since obviously everything what went wrong or was illegal was done by some individual, not by an abstract firm." - Ben Bernanke, former Federal Reserve Chairman, discussing the lack of legal action against bank executives following the 2008 crisis. USA Today
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|Produced by Ryan Derousseau|