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Leveraged Buyouts

December 16, 1988

Hooray for Jack Valenti!

He is so right about leveraged buyouts ("Before Leveraged Debt Ruins Us, Government Must Rescue Us," Op-Ed Page, Nov. 30).

And for the first time (that I have seen or heard) he addressed a concern I've long had--the employees of the companies being raided.

Much time is given to management and the stockholders but where is there any thought or consideration given to those people who produce the goods and services offered by these companies? A two-legged stool will not stand. The third leg, the employee, is vitally important.

It seems academic to me that when you ignore the employee, keep him in a constant state of anxiety over whether or not he will have a job or have to uproot his family and move to a strange town because of a threatened or pending merger, you have an employee who cannot give his best to his job. This person is being rubbed raw with concerns and fears. Families break up over such traumatic anxieties.

Many decades ago when people had job security there was loyalty to company management. Employees wanted to and usually did their best; thus the quality of their work and their productivity was high.

When the money-grabbers forgot the workers they started the destruction of the country's economic strength.

It is imperative that this country address the damage that leveraged buyouts have done and are doing to the fabric of this country. Tax laws that encourage borrowing for the purpose of these buyouts must be stopped immediately.

The "bottom-line" mentality must be tempered with astute longer-range planning.

If we fail in this regard we most certainly will not be able to compete with the Pacific Rim countries or the European Market of 1992.


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