This article feels very USA-specific. As an Eastern European I can tell you that most of us around here can very easily be won over if you're a boss and you tell the truth, especially if it is unpleasant. Most EE people would get a huge amount of loyalty for you if you're that boss and will tolerate corporate bad times and lack of promotions as well.

I keep remembering George Carlin's words that Americans have trouble with the truth. Obviously I am not judging but I've heard quite a lot of ther USA citizens say the same.

Coming clean is the best thing you can do as a CEO. Plus, as my wife says "if they leave you because you're in a tight spot, why would you need them anyway?"

I realize it's not always that clear and cut but IMO the general principle is sound.