More On What's Happening At Twitter

I found two items in yesterday's feed that, while there's some dissonance between them, provide additional insight into what Elon Musk dsicovered at Twitter. The first is the video above on the UK UnHerd YouTube channel, a follow-up in their developing series on Twitter that I first noted here on December 21. It features David Sacks, a venture capitalist and co-founder of PayPal with Musk. I'll discuss this video after I talk about the other data point, a piece by Tyler Durden at ZeroHedge, The Twitter Purge Continues: Musk Lays Off About 40 Data Scientists And Engineers Working On Ad Team. This simply confirms my surmise that at the time Musk decided to buy Twitter, there was simply no there there.

For years Twitter had operated less like a company and more like a cult compound for leftist ideologues, with free lunches, yoga rooms, smoothie, wine and espresso bars, and minimal work buffered by pointless meetings and near zero productivity.

Those days appear to be over. The latest proof? Twitter laid off "about 40 data scientists and engineers working on the advertising team" late on Wednesday night of this week, according to The Information.

A person with direct knowledge of the matter said that the layoffs now leave the company with "few engineers" working on “machine learning for ad optimization”.

These cuts come after additional reports this week that Elon Musk would be, among other things, downsizing the company's San Francisco headquarters from six floors to only two.

Earlier this week I noted a report that Musk had stopped paying rent on that headquarters. Durden concludes,

Interestingly, Twitter users have not noticed much of a difference in terms of functionality for the platform despite the mass layoffs.

We said it then and we'll say it again: the only difference has been the ability to speak more freely on the platform.

Let's move to the YouTube video with David Sacks. At about 1:43, he says,

The mood at Twitter, I think, they are kind of heads down now and working on product development. The things that people talk about outside the company, it's 95% about speech debates, that's about 5% of the conversation inaide the company. The other 95% is just building the product: how do we make this better? How do we ship more features? How do we get more efficient as a company?

Even so, Sacks continues to talk about the outside 95%, the revelations in the Twitter files involving coordination with the US government to censor the speech on the platform, and he goes so far as to say Musk's motive in buying Twitter was to end the censorship -- in other words, the irrelevant 95%. Wait a moment. What are the ideas the insiders are supposed to be floating, 95% by his account, on how to improve the product? Indeed, how did the additional layoffs of 40 more engineers affect this? He finally moves on at about 3:55:

. . . I think that Twitter can be a great business as well. In addition to fixing the censorship issues, I think it can also be a great business, because they simply haven't done much with that product. This product simply hasn't changed that much in the last 10 years, and already in the last month or so we've seen more improvements to the product than we have in the last number of years.

But as far as I can tell, for all that 95% of Twitter is now on improvements, there so far have been only two such improvements: monetizing the blue checkmark status and reducing the level of censorship. These have actually been minimal, while for good or ill, Musk has managed to damage the former prestige of the Twitter brand by doing just those things, while diminishing his own credibility as an entrepreneur by expending so much visible time and effort on Twitter, while investors are upset about the decline in Tesla's share value.

Prompted, Sacks turns to Musk's cost cuts at Twitter, but those aren't product improvements, and in effect, he acknowledges this at about 6:10:

The reality is, Twitter, like a lot of companies in Silicon Valley, was very bloated and overstaffed. It was possible to cut, call it, three quarters of the employees and actually improve the performance, because you didn't have a bunch of people working at cross purposes getting in each other's way. . .

But actually, the evidence we have from the "My Day at Work" TikTok video, which Tyler Durden inplicitly refers to at that link, was that employees at Twitter and elsewhere in Silicon Valley were, and often continue to be, occupied with "free lunches, yoga rooms, smoothie, wine and espresso bars, and minimal work buffered by pointless meetings". They weren't working at cross purposes; they weren't working at all. I'm not sure how much either Sacks or Musk understands the extent of this problem -- and both seem to be indulging in wishful thinking that there was ever value at Twitter.

Sacks seems to be a Musk ally and apologist here, but even in the course of making the best possible case for Musk's takeover of Twitter, he's basically acknowledging that Twitter never really had a product, and that by cutting the workforce 75%, he's been able to do nothing more than produce that same tired old non-product. But the information we have from accounts like Tyler Durden's is that anybody who might have been working on product improvements (if any of them actually was doing this) was laid off last Wednesday. In other words, there was never a there there, and there still isn't.

The question I continue to have is why Musk didn't understand this about Twitter before he made the offer to buy a company with an essentially worthless product. And yet again, why can't he recruit a CEO? No matter how Sacks tries to spin things, these questions keep coming back.

The Mystery Of Hunter's Finances

There's been a quasi-news story in the background for the past week that Hunter Biden has been trying to get a reduction in his child support payments to the Arkansas exotic dancer whose child he fathered. According to the New York Post,

In September 2022, Biden appealed to an Independence County, Ark., court for his IOUs to be reduced, claiming “a substantial material change” in his “financial circumstances.”

As the link indicates, the story has been around for some months. A story on the original filing from last summer quotes the dancer's attorney:

"Ultimately, this is going to require us to look deeply, more deeply, into Hunter's finances," Lancaster said. "I'm going to want to have a deposition with Mr. Biden. Like last time, I'm going to bring my forensic accountant to the deposition, unless the judge tells me I can't."

. . . In the past, Biden had presented himself as financially strapped, telling the court in a November 2019 affidavit, "I am unemployed and have had no monthly income since May 2019."

At the time, Biden said he also had "significant debts," due, in part, to obligations arising from a divorce.

A New York Times article shortly thereafter portrayed Biden as living in a $12,000-per-month Los Angeles rental with a swimming pool and a Porsche Panamera in the driveway.

The Post story from this past Wednesday at the first link refers to a filing made in the case on December 27:

“Even though the defendant has been the subject of articles by the New York Times regarding his ‘art,’ President Biden’s administration has taken measures to shield the White House from the buyers of the defendant’s ‘art,’ and the defendant was seen in New York City as recently as a few months ago showing and selling his ‘art,’ the defendant has refused to provide any information about his ‘art’ or the income derived from it,” Lancaster continued.

But there are mysteries beyond just the "art". As I noted here last summer, Hunter has been living in a Malibu, CA compound in a $20,000-a-month rental next to an adjoining luxury home that serves as a Secret Service detail headquarters for $30,000 per month. Access to Hunter's residence is closely controlled by the Secret Service, so that his conditions amount to house arrest. The $20,000 monthly rent on Hunter's house is reportedly paid by Hollywood lawyer Keven Morris, who reportedly underwrites other of Hunter's living expenses. According to that link, Morris also advises Hunter on his "art" sales. (The rental for the adjoining house for the Secret Service detail is paid by the taxpayer.)

Also according to that link, Morris also paid Hunter's $2 million tax bill, which was settled at the time his father became president. But this leaves aside the problem of Hunter's wife, Melissa Cohen, who has never had an income of her own but maintains a jet-set lifestyle. Can Hunter's art cover these expenses?

The younger Biden took an interest in art only recently, and although he had never sold a painting, his work was displayed at a Hollywood art show in 2021 with eye-popping prices as high as $500,000. He sold five prints for a total of $375,000 at the event[.]

One potential problem is that President Biden has had a history of subsidizing Hunter's lifestyle; for instance, he wired him a total of $100,000 to help pay his bills from December 2018 through January 2019. While the commingling of income among the Biden family is a potential tax issue, the question of Hunter's actual income for the purpose of calculating child support is entirely separate.

I'm not at all sure that the dancer's child support case will ever bring any of this to light, though. She and her attorney are likely using the threat of a deposition as a negotiating tactic, along with a separate petition to have her daughter by Hunter take the Biden family name:

Lunden Alexis Roberts, who reportedly worked as a stripper at a club in Washington, D.C., when she met Biden, has asked in a legal filing for her and Biden’s child to receive the Biden name.

According to the filing, the child — who reportedly does not receive Secret Service protection unlike other members of the Biden family — would “benefit from carrying the Biden family name.” It adds that the “Biden name is now synonymous with being well educated, successful, financially acute, and politically powerful.”

The suit also states that the Biden family remains “estranged from the child. To the extent this is misconduct or neglect, it can be rectified by changing her last name to Biden so that she may undeniably be known to the world as the child of the defendant and member of the prestigious Biden family.”

I've got to assume Hunter has been making his child support payments up to now -- if he didn't, it would certainly be news. If Kevin Morris, some other angel, or President Biden himself has been subsidizing the existing payments, it can only be in their interest to continue to pay the lady what she wants. The alternatives would be too delicious.

The Thread Tying The Corporate Crises Together

Tucker Carlson very belatedly featured the viral "My Day at Work" TikTok video by the egregiously entitled Twitter employee on his show earlier this week, with commentary from Mike Rowe. The thing nobody has pointed out, as far as I can tell, is that this video seems to have reached general notice last year on October 26, which was exactly one day before Elon Musk bought Twitter. In other words, it was almost immediately overtaken by events, and by December, a visitor to the same Twitter headquarters shown in the video characterized that headquarters as looking like a five-star hotel that's been abandoned.

In fact, the story as of Tuesday was:

Twitter’s landlord, the Columbia Property Trust, is suing the company for neglecting to pay rent for its downtown San Francisco headquarters.

The company’s new owner, Elon Musk, has reportedly been attempting to renegotiate the terms of the lease, as the company frantically tries to cut costs.

As I've said, Twitter ought to be a business-school illustration of Stein's Law, that which cannot continue must stop. Twitter's basic problem was that its product had no real value, and most years it lost money:

Twitter has been operating at a massive loss for years, failing to book an annual profit since 2019 (Mauer, 2022). For eight out of the last ten years, the company has posted a loss. While losses are trending downwards, the company saw a net loss of a staggering $1.14 billion in 2020.

The question neither Tucker Carlson nor Mike Rowe asks in the Fox segment is why investors and advertisers continued to support a company that was both extravagant in its spending, with a work environment that was more like a luxury resort than a place of employment, but produced such a worthless product. The one event that burst that bubble was Musk's takeover -- advertisers left the platform on the basis that Musk would minimize its censorship, resulting in a product that no longer maintained the appearance of a comfortable consensus among the gentry class. That suggests in turn that this was the value Twitter provided to both the advertisers and the investors, and this in turn appears to have justified the extravagent spending on an almost entirely non-productive workforce.

Tucker then turns to Mike Rowe and Rowe's point that "it's more important than ever to show the fact that a lot of Americans are doing real work". The dissonance between valueless products and workers who have real jobs carries over to the other two corporate crises of 2022, FTX and Southwest Airlines. FTX was a bubble that burst like Twitter, with an executive clique that lived even more extravagantly than the pampered and coddled drones at Twitter.

Its product was equally valueless, but one thing that struck me about the bios of its leadership clique was the emptiness of their accomplishments. I've pointed out here that figures like Sam Bankman-Fried and Caroline Ellison were treated like prodigies before they even started school, and they received many awards for their precocious achievements in math and physics, culminating in admission to elite universities -- yet they'd also been diagnosed with ADHD, which makes it impossible to do the sort of concentration and sustained mental work that's actually needed to win math and physics awards, much less attend elite universities.

In other words, they were living in a sort of high-status alternate reality fostered by the same self-validating gentry class that sustained Twitter. And make no mistake, given its history, Twitter's bubble would have burst even if Musk hadn't taken it over.

What's emerging with Southwest isn't so different: following the story of its holiday meltdown and uneven recovery, the impression I've had is of an executive clique that operated in isolation from the pilots, flight attendants, gate agents, and ramp workers who'd made the company successful over decades and continue to be loyal. A letter from a vice president of the Southwest pilots' union makes this point:

Herb [Kelleher]’s legacy and the culture he built from the ground up was centered on his employees and empowering them to make proactive decisions at the lowest level possible. However, the culture that Gary Kelly ushered in with his ascension to the throne was the exact opposite. Gary’s vision was to become the darling of the investment community while building an insulated and vertical hierarchical structure where all decision-making authority was slowly stripped from front line experts with the most situational awareness and moved further up the cubicle chain in Dallas far removed from line operations. During that time, he took our Company from being known for our personality and agility to becoming a classic technocrat’s dream with an explosion of stove-piped vice-presidential fiefdoms that all communicate vertically with little-to-no horizontal integration.

. . . A monetization of the once vaunted Southwest culture and instead turning it into a headquarters-centric cult. A good old boys and girls network indeed.

. . . I do not begrudge the vast sums of money our executives earned for working their way up the corporate ranks. I am a capitalist, and I love American upward mobility. I do, however, begrudge earning vast personal wealth while running our Company’s operations and culture into the ground.

The article that quotes this letter comments,

The sociology of pilots, and pilot unions, is fascinating because here the second vice president of the Southwest Airlines Pilot Association declares “I am a capitalist, and I love American upward mobility.” You’d never hear that from Sara Nelson [president of the non-Southwest flight attendants' union].

Pilot unions work to limit entry into their profession, to give them greater leverage in work rule and salary negotiations. But they don’t have the same narrative of desperate class warfare that other airlines do. Indeed, like law enforcement unions they tend to skew more Republican.

This is an interesting commentary on the current makeup of the "working class" -- the current Southwest narrative shows numerous employees at the operations level, regardless of professional status or education, working independently to resolve customer problems, often actively bypassing the corporate bureaucracy to do so, while recognizing the company's crisis results from an executive clique that's gone over to corporate capitalism in its current form. In other words, these people are a certain kind of Republicans, nothing like a traditional proletariat.

I hope this suggests a way forward.

Still More Southwest Cancellations

In the midst of media reports that Southwest is "back to normal", via Reddit, I learn:

Welp! @SouthwestAir’s entire system for obtaining weather report packets is down — so the whole airline is barred from taking off, per FAA regulations. 🫠

It was only 4 days ago, that Southwest restored normal operations…

— Ian Saint (@iansaint_) January 4, 2023

This was updated several hours later to indicate the system had been restored, but nobody was clear on how cancellations would affect downstream operations. A Reddit user reported,

Left Little Rock on time, just landed in Dallas. I was just sure that Southwest wouldn’t [bleep] with me and my 3 girls anymore than they already have (cancelled flight on Christmas Eve, no rebooking til after the 30th, spent thousands for other flights, no luggage our ENTIRE TRIP, etc.)

Pilot came on just after wheels touched down, and said he’s been working with SWA for 37 years and has never seen this level of incompetence. . . and he’s not sure how to tell us this. . . but we can’t get to our gate because someone somewhere in Southwest corporate has decided that planes can’t leave unless they have a PRINTED paper copy of the weather packet (whatever that is) even though the pilots’ electronic devices that they carry at all times have the exact documents in digital form. And for some reason they can’t print anything right now. So we are sitting on the tarmac waiting for a piece of paper to print that is unnecessary and stupid. Yay Southwest.

Interestingly, while I recognize that the pilot's remarks over the PA could subject him to corporate repercussions, I'm also sure that after 37 years, he was fully aware of this, but his level of frustration over a two-week period had probably pushed him to the don't-care point. No doubt he'd be happy to retire, and if pushed, I'm sure he will. But the replies from the Southwest groupies -- or maybe tankies -- were remarkable for their vitriol:

The captain needs to retire. Getting a printed weather packet is nothing new. It is part of the process. If he is that unhappy he should move on.

Or:

The seemingly redundant protocols are why it is so safe to fly. I don't need a bunch of armchair pilots throwing out these safeguards. If everyone knew so much, we wouldn't have these situations.

I outgrew Southwest loyalism in the 1990s. As a regular flier at the time, I saw too many cases where they canceled flights due to low ridership but blamed hardware issues. Since my tickets were paid by my employer, I coudn't really complain, but my view was that Southwest was a part of life, just like the need to buy a new dishwasher or pay credit card fees. Not everyone feels this way, but I think Southwest is getting exactly what it deserves.

It's clear from Reddit that Southwest's policies on refunding flights and expenses are completely opaque. For instance,

Contacted by phone several times told to submit tickets for the “crisis teams” to handle the issue. Haven’t been able to get a hold of anyone today or yesterday, started opening up DoT complaints related to the refund and reimbursement to get more attention. Anyone getting any solid communication from SWA?

Another case,

Reminder to call (888) 202-1024 if (800) 435-9792 is giving you long wait times. When asked if you have a claim number, just say yes. Was IMMEDIATELY transferred to an agent. Someone posted this number on here a few days ago, and I called it today. Even if you don't have a claim number, just say "Yes" when asked. I was able to talk to someone immediately.

The poster explained in the commnents,

Whole call took about 50 minutes, she was apologetic and efficient. I just had to give her all of the confirmation numbers of the canceled flights and she refunded each one, one-by-one. I was also promised a $250 voucher that expires in a year. I haven't received the voucher via email yet, she said it could take up to a month to receive it just because of the overwhelming requests... so who knows when I'll actually get that, if I get it.

When I asked about reimbursements for Lyfts, meals, etc. she just told me to do it through the website, they seem to have no information on how long that can take and can't do anything about it themselves.

I'm still $350 out for the flight I took on 12/26 (what I paid for it), and she said she couldn't refund me because I actually went on it? Of course, this should just be seen as a "rebooking" that I did myself, and she understood that, but she just redirected me to the website to get this sorted out, because she couldn't do anything on her end.

So if you use workarounds to get past the obstacles, they'll help you out with some of the issues, but not all of them, and you're still in limbo over potentially thousands in hotel, meal, and rental expenses. Another user reported success with a similar bypass-workaround strategy:

I did the email thing and got no response and saw that if you @ them on Twitter and then DM your information they may get to you quicker so I did that and DM’d them all of my information and receipts including my situation, confirmation number, flight numbers, DOB, etc. and they processed everything and told me the amount of he check they were going to send me within 3 or 4 hours. They also figured out that I had emailed them as well and linked the cases

Again, going through their published procedures probably doesn't work, but if you try hard enough to bypass them, you may actually find a helpful individual employee who can resolve some or all of your issues. The best that can be said is this doesn't follow the model of transparent response to corporate crises. On the other hand, if you're a Southwest loyalist, they'll hand you bundles and bundles of rewards points for future flights, and you can abuse the still-unhappy customers on forums to your heart's content.

I do wonder how many of the abusive types are bots.

Southwest Isn't "Back To Normal"

Yesterday I linked to what amounts to a consensus account of corporate crises and successful vs unsuccessful responses. So far, what we're seeing is an unsuccessful response from Southwest. All reports are that, whatever specifically happened in Denver, the meltdown started there and quickly spread to other major Southwest airports. But as of this morning, Denver still isn't fixed. According to the New York Post,

Travel issues continued to snowball at Denver International Airport on Monday after over 600 flights were canceled or delayed because icy conditions and poor visibility plagued the runway, according to reports.

The Denver Post reported roughly 650 flights were affected, which could not have come at a worse time.

According to CBS News yesterday afternoon,

Embattled air carrier Southwest Airlines again canceled dozens of flights after returning to a more regular flying schedule following a winter storm-related meltdown last week.

Southwest as of Monday afternoon had canceled 160, or 3%, of its flights, the most of any American airline, according to tracking site FlightAware. Another 422, or 10% of its scheduled flights were delayed. The majority of disrupted flights were scheduled to fly in or out of Denver International Airport.

A Denver TV station went into considerably more detail on the situation this morning. YouTube won't let me link directly to the story, but it can be found if you click here. At 0:09,

The Southwest Airlines disaster is continuing this week, and many passengers are still waiting for their bags. When or how they can get their bags at all depends on who they ask.

They shift to an on-the-scene reporter who interviews a woman who'd tried to fly from Denver to Milwaukee over the holidays but had her flight canceled. However, her luggage stayed at the Denver airport, where it's being held in an overflow area. At 0:43,

Like thousands of Southwest passengers across the country, Pat Tufta [phonetic] has spent the past week trying to get her luggage. After Southwest canceled her flight to Milwaukee, she had to book a last-minute flight on United.

"A loaded plane that was never going to take off with all of our luggage, everyone from that flight I can tell you has not seen their luggage since. And then when I ckecked in with customer service agents in Milwaukee and over the phone at DIA on Saturday when I had to return back to Denver, they told me it was sitting in the hangar, and there was nothing I could do about it."

Instead, she was told her bag would have to fly first to Milwaukee before shipped back and returned to her. She reached out again to customer service over the phone, who agreed the process sounds ridiculous.

"The person I talked to actually chuckled and said that doesn't make sense. You need to talk to a supervisor. But I said, well, I can't."

Now, a week later, Pat says she doesn't know when she'll get her bag and is frustrated with the inconsistencies. We asked Southwest whether it plans to reevaluate this policy and why there has been a lot of mixed messaging. A spokesperson did not answer those questions and said this in an empty statement about working around the clock to reunite passengers with their luggage.

I worked for a utility during a corporate crisis of its own after the 1994 Northridge, CA earthquake, in which, although service to millions in its area was affected, company spokesmen initially denied there were any problems and in fact talked condescendingly to reporters, implying they didn't understand the company's business. The company line changed in a matter of hours, and the initial spokesman left the company the following year.

What we're seeing so far from Southwest are glib and general statements -- the Denver reporter characterized one as "empty" -- that the airline is "back to normal", except that "people are working around the clock", but there seems to be a refusal, even in the airline's press relations office, to acknowledge there are serious continuing problems, especially with delayed baggage and the continuing need to cancel flights at Denver.

Another example of bad crisis communication is Southwest's denial that that n Denver ramp agents quit in response to the December 21 Chris Johnson memo, when the continuing reported cancellations and delays in Denver suggest there's been a staffing issue of some sort there that still isn't resolved. The press release below from the Transport Workers Union Local 555 website posted on December 28 strongly suggests there were serious matters taken up following the Chris Johnson memo (click on the image for a larger copy):

Here's my tentative take. When the weather turned bad over much of the US on December 21, the Denver ramp agents found themselves working in extreme cold, and some developed frostbite. At that point, I would imagine that some either requested modified working conditions, left work claiming to have developed frostbite, or both. This was reported to Southwest Vice President Johnson in Dallas, and in a panicked meeting with other suits, it was determined that a crackdown was in order. If anyone was claiming frostbite as a reason to leave work, then they'd need a doctor's note or be fired.

Checking news reports on the December bomb cyclone, this started on December 21, the same day the memo went out, and that says it was issued in a panic by the suits at Mahogany Row, who apparently understood the impact a staffing shortage in Denver would have on Southwest's operations. However, they failed to run this by legal, who would at minimum have told them the policy violated Colorado law.

My guess is that as soon as the Denver ramp workers got the memo, they went to the union, who quickly spelled out the consequences of any enforcement of that policy to Mahogany Row, which certainly would have been mass resignations followed by a class action suit demanding reinstatement, damages, and the threat of further labor action. Whether any ramp workers resigned, individually or en masse, isn't clear at this point. If they had, though, they would have had a legal case for constructive dismissal and likely would have won.

My surmise, given the likely threat from the union, is that a solution was quickly worked out, whereby the Denver ramp workers would have immediate improved conditions, including rotation off outdoor work, and the memo would have been quietly finessed. This would be one explanation for the continued staffing problems at Denver, even if there had been no mass resignations. Since lawyers on both sides would have been involved, the press release would have been carefully worded, but it sounds very much as though Southwest, and Chris Johnson, had to back down big time, but not soon enough to avoid turning the situation into a major crisis for the company.

Which is to say the Southwest crisis is by no means over. The same idiots who created the crisis are still running the show.

Back To The Southwest Denver Memo

While Southwest has acknowledged that the memo above, leaked via a Twitter post from an insider, is authentic, it has denied that 120 or more Denver ramp agents quit in response.

Southwest Airlines says rumors that as many as 150 ramp agents in Denver walked off the job over the last few days after an internal memo from management told staffers that they would be directed to do mandatory overtime or face the threat of termination are unfounded.

Operations in Denver have been under strain as a result of Winter Storm Elliot, and ramp agents have been working outside in treacherous conditions and sub-zero temperatures. A Southwest Airlines spokesperson said a decision to ‘rotate’ ramp crew more often was behind some of the long flight delays and cancellations.

Southwest's explanation in effect falls back on the weather as the efficient or proximate cause of its meltdown, but if that were the case, all airlines would have been equally affected. Comments on Twitter and YouTube have made the point that all major carriers have had to deal with severe winter weather throughout their history, and Southwest was the only one to suffer a meltdown over the past holiday week. The CEO of the Denver airport authority made the point in this media interview that Southwest was the only airline at that airport to suffer a ramp staffing problem, whatever its source.

What interests me about the Southwest meltdown is that it's a textbook corporate crisis that's so far been bungled in a textbook way. This site lists a number of corporate crises, some handled well, others badly bungled. Factors that contribute to successful crisis management include acknowledgement and ownership of problems, clear and transparent communication, and immediate and visible corrective action. Factors that can damage a company long term include wishy-washy reaction, finger-pointing, telling lies, and not fixing what's gone wrong.

Given the thousands of canceled flights last week and the passengers stranded as a result, it was an especially bad sign when the Nashville operation called police to inform stranded passengers that their flights had been canceled and threatened them with arrest for trespassing if they didn't clear the area. As I covered at the time, Southwest claimed they couldn't verify this had happened despite a viral video showing that it had. It's in this context that I've got to treat Southwest's insistence that the story of 120 or 150 ramp agents quitting in Denver is just a rumor with some skepticism.

The memo alone isn't reassuring. My wife, a retired corporate attorney, said immediately after she saw it that it must not have been run by legal before it was sent. It turns out her instinct was correct, I found this on an on line forum:

[T]hat’s not just unreasonable, it’s downright illegal according to Colorado labor laws. Southwest can only ask their employees for a doctor’s note after four consecutive days of absence and that’s according to a post-COVID law.

I checked, and this is true. According to this Colorado state site,

Employers can require documentation for accrued paid sick leave (not for COVID-related public health emergency (PHE) leave), but only for absences of four or more consecutive days — and employees can provide the documentation after the leave ends.

The overall tone of the memo suggests that "employees alleging illness" are malingering, and that the ramp agents in general are slackers. It wasn't until the crisis managment stage a week later that Southwest insisted it had been rotating employees out of the weather to deal with conditions, and one thing I note just as someone who sometimes had to write official company announcements was a complete lack of wording to the effect that we understand the difficult conditions, and we're doing everything we can to help during this extreme weather. Nothing -- just come to work and don't go home or you'll be fired. This is just not how you write this kind of announcement.

A week later, the New York Post, having finally gotten a copy of the memo, contacted Southwest about it:

The Post reached out to Southwest for comment.

On Monday, the Dallas-based company finally cited weather and staffing issues at Denver International Airport for setting off a chain of events that led to massive, systemwide disruptions that began over the holiday weekend and extended into this week.

But this, again, doesn't answer the question of why every major airline and airport deals with cold and snow as a matter of annual routine, and in this particular case, Southwest's week-long meltdown was unique. No other carrier had an equivalent problem. And as the Post story put it,

A Southwest Airlines executive warned of a staffing crisis at one of its major airports days before thousands of passengers were stranded over the Christmas holiday weekend, according to a report.

It's hard not to think something led to an atmosphere of panic in Southwest's Dallas Mahogany Row that was reflected in the December 21 memo that was rushed out, almost certainly without going past legal, and I would also think that if it contradicted Colorado labor law, the union, which has its own legal department, would have been immediately involved -- and whether or not 120, or 150, or 200 ramp workers then quit, Southwest had a major problem on its hands that should not have happened. The big question continues to be why this happened at Southwest and nowhere else.

A question maybe just as big is how this could happen at what is now the biggest US air carrier. Regulators of industries like banking have been assiduous at making sure the US financial system is not subject to equivalent risks. One problem is that secretaries of transporation in administrations of both parties have largely been political patronage appointments; Mayor Pete's predecessor was Elaine Chao, Mrs Mitch McConnell. This needs to change.

Every indication is we're seeing a textbook bungling of a textbook corporate crisis. Ideally, the political system may need to get involved to solve the overall problem. I wouldn't be surprised if in addition to Southwest executives, Mayor Pete has to go as well.

An Aristotelian Approach To The Southwest Meltdown

As I've said here now and then, I'm an Aristotelian, which means I look for causes. What caused the Southwest meltdown? Legally, the proximate cause in this case is probably also Aristotle's efficient cause, which is what appears to be a badly botched management decision in Denver on December 21. A YouTube aviation commentator, Juan Browne, explains it best:

At about 1:40, he begins,

. . . but it was an incident at Denver's airport back on 21 . . . from the 21st of December through about the 24th of December that ignited, that started, this meltdown before the IT failed. As we all know, Southwest Airlines is a point-to-point airline system, but it does operate through other airlines' major hubs, and over here at the major hub of Denver, Colorado, as this bomb cyclone storm began to hit, on or about the 21st of December, an operational emergency was declared by management there specifically regarding the ramp agents, as the temperatures plunged and ramp agents were, of course have to work outside with the aircraft, were having a more and more difficult time of dealing with the aircraft in these freezing temperatures, a strongly worded memo went out from management to the ramp agents declaring that there was too many people calling in sick, and that they were going to have to declare an emergency, and if anybody is sick, they're going to have to have a letter from their doctor the day that they return to work, uh, everybody is going to have to work mandatory overtime, and anybody that is calling in sick and doesn't have a doctor's letter by the time that they show back up for work, they will be terminated.

As this word got around to the ramp agents at Denver, apparently (this has not been verified), upwards of 200 ramp agents quit, and these are jobs that pay about $20 to $28 per hour working with the aircraft out in the weather. Once that hit Denver, the aircraft began to stack up, getting parked, they couldn't get the aircraft into the gates. If, when you cannot get the aircraft into the gates, especially in this kind of weather, you have to start canceling flights, so that started a rolling cancellation of flights from Denver, Colorado. Soon those cancellations of flights ended up shutting down the entire Southwest operation, first at Denver, and that was followed by Dallas, St Louis, Nashville, and Chicago's Midway Airport. The entire Southwest operation was shut down. Now, with this many aircraft being parked, this is when the IT problems began with the SkySolver software thnat Southwest Airlines uses. This software is circa 1990s vintage, 40 year old software that they use to schedule pilots. flight attendants, crews, and marry them up with the aircraft and form the scheduling sequence. This 1990s software is capable of handling about 300 changes. We're talking changes in the thousands now, and the software was simply overwhelmed, and so all the automation for scheduling apparently failed, forcing schedulers to revert to manual scheduling, an extremely complicated job, completely overwhelming the system, thus forcing the airline to do a complete reset. . . and start all over[.]

UPDATE: Review of Twitter posts suggests that as of December 21, ramp agents were leaving work due to frostbite, which I would imagine constitutes unsafe conditions, and the memo may have provoked he walkout in response.

It's been more than a decade since I last flew Southwest, and I was shocked to see that it's now the largest US air carrier. The economy can't be exposed to this sort of calamity. The mass walkout in Denver appears to be confirmed, with the only question being just how many quit -- Juan Browne's version is 200 or so while the tweet below says 120:

Guys… this is why Denver canceled so many. They got this letter and 120 ramp agents walked out pic.twitter.com/uicHcPL3VT

— Overheard At Southwest (@AtSouthwest) December 24, 2022

I see someone named Chris Johnson, Vice President of Ground Operations, is the author of the memo, and this says to me that Johnson himself and at least one of his bosses need to be escorted out. Clearly the most indulgent policy over sick leave would have left a better result than what occurred, and we must recognize that it was Johnson's call to make.

Another version of Southwest's problem is the idea that the airline went downhill after its founder's retirement:

Southwest's problem is that its leadership, after legendary founder Herb Kelleher retired, were financial guys, not operations specialists. Southwest's unions are right in pointing to the airline's low-tech crew-scheduling software called SkySolver as the culprit in the December breakdown. It was also at fault in a smaller but still devastating Southwest breakdown last year linked to an unexpected air traffic control (ATC) outage in the Federal Aviation Administration's (FAA) Jacksonville control center.

This is more like what Aristotle might call the formal cause, the management culture from which the efficient cause arose. In this context, though, the SkySolver software problem is one of several cascading results from the efficient cause, not the origin of the meltdown. I've seen various opinions that say the current CEO, Bob Jordan is more of an operational type than a financial type, and that he'd been trying to turn things around, but apparently to no avail after just 10 months on the job. This video gives me the impression of a corporate pretty boy who speaks in glib generalities:

I assume the Southwest board is already contacting an outside law firm for a thorough investigation. I would hope there would be at least two areas of focus, what the simmering issue was behind the mass walkout in Denver that triggered the meltdown -- at best, Chris Johnson should already be on administrative leave -- and who authorized the situation in Nashville where the police were enlisted to tell passengers their flights had been canceled and clear them out. That person also needs to be fired. (It sounds as though there was a serious sitdown in Denver between the airport authority and Southwest; something like that needs to happen in Nashville and probably elsewhere, too.)

I would imagine, though, that the board is going to have to decide fairly soon that Mr Jordan isn't what they need to turn the company around.