Armando Codina On CNBC

What do Home Depot, GM, American Airlines and Merrill Lynch all have in common?

Armando Codina, the Florida real estate tycoon, sits on each of their boards.

Is this a good thing? Well, nearby is a Yahoo-sourced, five-year price chart for each firm and the S&P500 Index.

What do you think? Armando's firms all trail the S&P over the past five year period.

What's really scary is to listen to his expound his views, as I did this morning on CNBC. Here are some of the chestnuts I heard:

-Lehman should be saved, in some capacity, and continue to exist, because it is such an 'important' financial institution.

-GM's CEO, Rick Wagoner, has the full support and confidence of the board.

-GM should be given assistance from the US government, in the form of aid in raising capital, which may include loans, in order to invest in 'green' technologies and buy time to return to financial health.

-GM and the rest of the American auto makers are more important now than when then-GM President Charlie Wilson uttered his famous remark, "What’s good for the country is good for General Motors, and vice versa." Thus, we must save GM.

This isn't an exhaustive list of Mr. Codina's shocking remarks, but they are the ones I most vividly recall.

What we see, from his comments, is a board member of four large, ailing American companies who believes companies should never die. If they are in danger of dying, even from their own misguided actions, they should be given a stay of execution by the Federal government. No large company, it seems, should be allowed to fail.

Evidently, Mr. Codina never heard of Joseph Schumpeter and ideas on the dynamic nature of capitalism. Companies rise and fall, are born, and die.

From his roots as a real estate developer, it's believable that Mr. Codina just doesn't really understand the realities of the larger system of American business. In real estate, land generally remains in existence. People need places to live. Businesses need places from which to offer goods and services for sale.

But businesses such as Home Depot, Merrill Lynch and the other firms on the boards of which Mr. Codina sits, can and do fail. Their business models may fail to adapt to new competitive or market realities. Or they simply may no longer offer attractive merchandise for sale to consumers.

Just because they fail does not mean that you can't buy a car, fly to another location, trade equities or bonds, or buy a tool for home use. If it's a profitable need to fill, someone else will still be around to offer competing goods or services.

It's instructive to hear the actual views of a live, sitting board member of ailing firms like these four. Now we can better understand why they have no shame. They overpay underperforming executives, wait too long to fire them, and see no wrong in, having badly overseen the management of the firms on the boards of which they sit, approaching taxpayers, via the Federal government, for help in remaining solvent.

Makes you sick, doesn't it?