Exactly, but I believe you have the causal chain reversed. It was the big companies that severed the bond of trust, and the employees who had to adapt to the new free-for-all market.

Neutron Jack eliminated 81,000 jobs in 5 years from GE (1980-1985). This resulted in the remaining employees, quite rationally, being very concerned for their careers. And thus, they began looking for options, and looking out for #1, because they knew they couldn't depend on Jack.

Of course, I agree that it is not productive to constantly be looking for better opportunities, but this is a result of never knowing when a Jack-like CEO is going to lay you off. Big companies started this war, and now they have to live with the consequences.

The startup movement is, for all intents and purposes, a way for talented employees to directly capture some the incredible value they would otherwise have created for big companies. Jack could've given these guys profit-sharing, equity or other incentives to work for him. Instead, he hung the sword of Damocles over their heads.

Elon Musk would've made one hell of an employee for any big corp. Instead, after weighing his options, he realized it would be better to just beat them at their own game.

You reap what you sow, Jack.

Because they had to. The original "bond of trust" was never about actual two-way loyalty; it was about the company bottom line. Companies used "bond of trust" rhetoric to lure employees in; they never actually meant it.

In the period following WWII, most industries in the US were growth industries: companies had to get and keep workers by hook or by crook, even if it meant giving them lavish compensation well beyond what their work would actually be worth in an equilibrium, non-growth market, because the alternative for the company was to lose all the growth business to their competitors, as people bought cars, refrigerators, etc. who had never had them before. (Pg talks about this in one of his essays: basically, companies like GE in the two decades or so after WW II were startups overpaying for labor to capture market share.)

By the 1970s and 1980s, much of that growth had stopped because most of the markets for the big US industries were reasonably saturated. Most people now had cars, refrigerators, etc., so those companies all had to shift from a growth market to a mature market where most business was from repeat customers wanting to upgrade their products, not new customers who had never had the product before. So the companies, in order to stay in business, had to drastically change the way they treated employees, since the costs of those employees were now a significant driver to their bottom line.

I'm not saying the companies were good and sweet and true; of course not. They broke a lot of long-standing employee agreements in the process of downsizing. I'm just saying that any employee who didn't see it coming from a mile away wasn't paying attention, and any employee who actually believed the company rhetoric about the "bond of trust" was living in a fool's paradise from the beginning.

> Jack could've given these guys profit-sharing, equity or other incentives to work for him.

He could have given some of them those incentives, yes. He could never have given all of them those incentives; there wasn't enough to go around. The plain fact was that companies like GE had too many employees for a mature market; there was simply not enough business any more to support all of them.

Again, that doesn't mean the way he did it was good. But if it took what he did then for employees to realize they couldn't depend on him, then again, those employees weren't paying attention; they should have known from the start that they couldn't depend on him, that if push came to shove he was going to do what was best for the company, not best for them. Any employee should always know that; that's what it means to be an employee.

The comfort of 1950s US was an accident of the WW2 windfall resulting from our happy position as the creditor for most of Europe. Pointing to that accident as a model for future progress is childish.

If anything I'd have thought the wage and price controls from WWII were a bigger factor, since in the absence of higher pay, companies had to offer more benefits and cultivate better relationships with their employees to keep them around - and there seems to have been a lot of inertia from those policies.

Things like price controls and the GI bill and the Cold War all helped in their way, but I'm not sure that that's a formula you can deploy going forward.

These advantages slowly eroded as other economies were rebuilt. They nevertheless lasted well into the 1970's.

After all, it's not just competitors that are gone, it's customers too.

That no longer is much of an option, as wealthy individuals have not only managed to reduce capital gains to ridiculously low levels, but also diversified their holdings throughout the globe. This makes taxation a poor tactic, as capital will just flow to tax havens as the rate increases.

Turns out that feudalism is the natural state of man, and reprieves from it are quite temporary anomalies.

For those interested in details, Thomas Piketty's Capital is an excellent reference on the subject. Also, the movie Inequality for All is a far more approachable presentation based on the book.

Ah, the New Deal, when our leaders thought they could lead us out of famine and into prosperity by burning crops. Birthplace of big-agribusiness! Et cetera.

What survived from the New Deal were the Keynesian stimulus programs, which were generally very successful, lasted through the war and up through the '70s, and some to this day.

So it's not like the new ruthless environment is a result of budgetary restrictions.

He used "fire 10% management" strategy for years, maybe even started that thing. I find suspect that someone who is not particularly ambitious man working 9-5 survived long in that stab back otherwise you will be one of fired 10% environment. Maybe he retired before or was stable due to connections?

There were bound to be many many people who worked hard, did their best, achieved a lot and then fired cause somebody had to be fired no matter objective absolute performance.

Jack Welch contributed his share to dropping loyalty. Whether the "old high loyalty" was better or not, Jack Welch is among those who destroyed it.

It is easier to say "Jack Welch, big badman, such fat meanie" than it is to track all the myriad complex changes in tax policy, central banking, technology, society, and in other fields.

"I find suspect that someone who is not particularly ambitious man working 9-5 survived long in that stab back otherwise you will be one of fired 10% environment."

You're entitled... to your feelings. I would describe someone who worked for over 30 years without attempting to reach an executive position as 'not particularly ambitious.' I could also be lying. Or paid off by GE. I could even be Jack Welch.

Don't trust what you read on the internet.

Your grandfather working life stopped in the mid-1980s, so it was all in the making. He had maximum few years of that. GE after Jack Welch was not exactly known for 9-5 easy going non-ambitious culture.

It is quite possible that GE had enough "fat" for someone working 9-5 without much ambitions to make to the top 20% who were getting large bonuses. Then, once they fired lazy, only ambitions and non-ambitions people remained. That is the point everybody complains about, cause non-ambitious follow and then it is fight about politics between remaining ambitions.

However, your grandfather retired a millionaire, so he must have been high enough in hierarchy or be outlier in some other way. Regular GE workers in that era did not retired millionaires.

(Shrug) The ones who weren't slackers did better somewhere else. The ones who were slackers, Welch was right to fire. What's the problem here, exactly?

I'm not defending stack ranking -- it's stupid and counterproductive. But the notion that GE owes somebody a lifetime career at their shareholders' expense is unsustainable in a world that (rightfully) doesn't work that way anymore.

Loyalty is seen as weakness: "this person can't hack it on their own!" Everything is viewed through the lens of power, which makes for a highly toxic environment.

> Propagandizing for yourself to eke out a good living and career hopping all over the country is a pain in the ass. Both activities are tangential to producing profitable work over a long period of time.

Thank you.

In the absence of believing in institutions (employers), we now just believe in ourselves. To the point where we're actively encouraged to "do things and blog about them." Yes, we need to call attention to the things we've done because...well, everyone else is yelling about what they've done.

I understand the need to talk about what you've done, but it's beyond ridiculous how much self-promotion goes on. Sometimes I feel Twitter and HN is over 50% self-promotional. It's gross.

It's worse if your goal is to work for one company for your entire career, and take whatever that company can offer you, yes. The new system no longer offers that goal as a realistic option.

However, by not offering that goal as a realistic option, the new system at least forces people to take responsibility for their own careers, instead of expecting someone else--"the company" or whoever--to manage their careers for them. I don't think that's a bad tradeoff, all things considered.

I'd have thought your grandfather was retired by the time Welch took over. In any case, Welch changed GE corporate culture away from what your grandfather would have been nostalgic about.

I'm not so sure. I think company executives in the boom years following WWII knew perfectly well that a time would come when the boom would be over, and those companies would have to start focusing more on labor costs and downsizing, reducing pay and benefits, etc. They just didn't see any need to tell the employees ahead of time that all that was coming at some point.

In other words, the company executives were never under any illusions that their "work all your career at our company and we'll take care of you" rhetoric was actually sustainable in the long term. Only employees had those illusions.

> It worked out just fine.

It sure worked out fine for Welch, yes. It didn't work out fine for a lot of his employees.

Edit: typo.

This doesn't mean endless propaganda. It means taking the outside view, writing well, and perhaps sometimes giving presentations that are actually useful. It means earning trust at a distance, not backstabbing like you claim.