GROUNDED: Frank Lorenzo and the Destruction of Eastern Airlines by Aaron Bernstein

GROUNDED: Frank Lorenzo and the Destruction of Eastern Airlines

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A murky, unbalanced recap of how Eastern Airlines came to grief at the hands of its proprietors, unions, and a welter of would-be saviors. Business Week correspondent Bernstein casts as chief villain of the piece Frank Lorenzo, the reputed asset-stripper who acquired financially troubled Eastern on the cheap early in 1986. Lorenzo soon engaged in confrontations of the sort that had served him well in the past, playing off labor leaders against one another. When collective bargaining failed to yield nonnegotiable wage cuts and productivity concessions, he put the deficit-ridden carrier into bankruptcy. Lorenzo was unable to keep Eastern at or near the break-even point with strikebreakers, and a swarm of white knights (including Peter Ueberroth, the ex-commissioner of baseball) rode to the rescue brandishing buy-out offers. While Lorenzo managed to deter all bids, he eventually lost control when a federal judge appointed a trustee for the much-diminished Eastern. Bernstein provides a blow-by-blow account of the largely unedifying action that has put a going concern in extremis. In going out of his way to make as damning a case as possible against Lorenzo, however, he loses sight of larger and smaller issues. For example, he gives no clear idea of what Eastem's market value might have been at various mileposts along its flight into near oblivion. Nor does he put into adequate perspective the intransigence of union bosses working at cross-purposes and the private agendas pursued by mediators as well as prospective purchasers. On the evidence of his gracelessly written, discontinuous narrative, dozens of participants share at least a measure of blame for the sorry tale's probable outcome. Bernstein's portrayal of Lorenzo as a latter-day incarnation of Ming the Merciless affords a focus that's at once dramatic and populist, albeit one that belies both the story's broader-gauge realities and its longer-range implications. In brief: a hatchet job more notable for heat than for light.

Pub Date: Aug. 1st, 1990
ISBN: 1893122131
Publisher: Simon & Schuster