Cap Executive Pay

[Whack-a-Mole]

@IdahoMauleMan

I’m not debating whether it is the American public’s problem, I’m asking you HOW it became the American public’s problem. You sort of quickly blew through that point above, and then concluded that the government must get involved. Because the free-market guys failed us all, somehow.

I’ll ask again: How are the bank failures’ the American public’s problem? Why isn’t a bankruptcy of a bank just confined to its shareholders?

Said it time and again. “Too big to fail.”

I am admittedly on the fence on this. I did write my congresscritters to oppose the bailouts. On the other hand I realize, much as I hate it, that the damage to the country to just let these guys sink is so spectacularly awful as to make our current troubles seem not so bad.

You seem hell bent on cornering me into something but you make no sense.

We are NOT letting these institutions go bankrupt. Discussion on whether we should or not is for another thread. Fact is we are bailing them out to the tune of trillions of dollars.

Sorry if you do not like it. That is how it is. Period. End of story.

And frankly, even if we did just let them go bankrupt it’d STILL be my problem. The knock-on effects from these banks failing extend far beyond just their shareholders. Even with the bail outs you may have perhaps noticed the economy is in the shitter and unemployment is rising to levels not seen in decades. People are losing their homes. Businesses are failing that were actually run well.

You and others like you seem shockingly able to put the blinders on, stick your fingers in your ears and ignore the plain-as-day consequences of where a lack of regulation got us and prefer to tell everyone the evils of regulation.

Your way is provably not a good way to run things. My idea may be bad, or not. However we know down your road lies ruin. The proof of it is all around us now. Sorry if that is inconvenient to you.

[Ocean_Annie]

@Shodan

…perhaps you could cite a few specific examples of how politicians sold their vote in return for campaign contributions, and how a large tax increase would have prevented this from happening.

A large tax increase will not eliminate corruption.

Although this may not be exactly what you want, here are a few specific examples.

@Shodan

Because I don’t see where you have addressed IdahoMauleMan’s point. You say that money is power, and that concentrating money in the hands of private individuals gives them too much power. But you deny that concentrating the same money in different hands - namely, those of government bureaucrats - constitutes a transfer of power.

I didn’t read through the thread to refresh my memory, but I am fairly confident that I never denied redirecting wealth from the private to the public sphere is a transfer of power. Undoubtedly, it is a transfer of power from the private to the public, but elected officials, or politicians, have limited authority and exercise the public’s power. Since the government collects revenue to spend on behalf of the public, members of the government are stewards of public funds not self enriching benefactors --they shouldn’t be. There is an obvious need to hold public officials accountable for their decisions. Corruption can’t be tolerated and the consequences should be severe.

@Shodan

A fair amount of lobbying, after all, is to shape tax policy and try to shift the burdens of taxation onto someone else. Why would increasing taxes cause this to disappear?

The tax system needs fundamental change, but it should be part of a broad reform effort.

[Ocean_Annie]

@Sam_Stone

according to this cite, crazy executive pay is partly the responsibility of government, through the law of unintended consequences.

For example, in 1993 the Congress tried to limit executive compensation by allowing only the first 1 million dollars of executive pay to be tax deductible. The result was that executives increasingly were paid in stocks and options - right at the time when the share prices of many companies started going through the roof. So they made out like bandits.

To offer a counter argument, a NYT’s piece that ran in 1993 asserts that Clinton’s tax laws aimed at curbing CEO pay were full of loopholes, which I suppose were intentional, that created a symbolic bill with no real impact on executive pay. Corporations were already using stock options and deferred pay as part of CEO compensation packages.

Roberto Goizueta’s deal with Coke had become the gold standard for compensation and the envy of CEOs before the Clinton administration’s new tax laws.

[IdahoMauleMan]

@Whack-a-Mole

Said it time and again. “Too big to fail.”

I am admittedly on the fence on this. I did write my congresscritters to oppose the bailouts. On the other hand I realize, much as I hate it, that the damage to the country to just let these guys sink is so spectacularly awful as to make our current troubles seem not so bad.

You seem hell bent on cornering me into something but you make no sense.

P1. We are NOT letting these institutions go bankrupt. Discussion on whether we should or not is for another thread. Fact is we are bailing them out to the tune of trillions of dollars.

Sorry if you do not like it. That is how it is. Period. End of story.

P2. And frankly, even if we did just let them go bankrupt it’d STILL be my problem. The knock-on effects from these banks failing extend far beyond just their shareholders. Even with the bail outs you may have perhaps noticed the economy is in the shitter and unemployment is rising to levels not seen in decades. People are losing their homes. Businesses are failing that were actually run well.

You and others like you seem shockingly able to put the blinders on, stick your fingers in your ears and ignore the plain-as-day consequences of where a lack of regulation got us and prefer to tell everyone the evils of regulation.

Your way is provably not a good way to run things. My idea may be bad, or not. However we know down your road lies ruin. The proof of it is all around us now. Sorry if that is inconvenient to you.

So, if I boil down your post above into two key points, I see…

P1. CEO failures have become America’s problem because we are bailing their companies out. That sucks, I know, IdahoMauleMan. I don’t like it anymore than you do. It’s the government that is doing it against yours/mine will. But it’s just the way it is.

[My comment]

So you don’t like the fact that Congress is bailing out these companies with your taxmoney. But you’ll just accept that as ‘that’s the way it is’, and follow that up by granting them more power and control over the economy? A little hair of the dog, perhaps?

Dude, you are rearranging the deck chairs on the Titanic. You are blithely ignoring the core, main, root-cause reason WHY the failure of CEO’s have become your problem, and then throwing more good money after bad by granting Congress more power.

[/My comment]

P2. Explain the ‘knock on’ effects point. Explain it in detail, please. I’ll patiently read every word of your post.

This is what I’m trying to get you to understand in my previous posts. Enron was once the 7th biggest company in the United States. It collapsed in bankruptcy, yet the power markets in which it dominated for years continued along just fine afterwards. Millions of homes across the United States weren’t blacked out. Power cost the same after Enron’s demise, as before. Electrons got to your home outlet just as they had before.

But that’s not the same with the banking system. WHY are there knock-on effects in the banking system? WHY does the failure of a large bank have knock-on effects?

Whatever logic you are using, it always points you back to the CEOs. And the solution to that, in your mind, is more government control and involvement. Do you have any idea how much government control and involvement already exists in the financial system? Would you entertain the possibility that perhaps, just perhaps, the reason there are knock-on effects is because of the government’s involvement?

[Sam_Stone]

It’s interesting how populism works. Here we have a systemic problem involving government, markets, complex new investment vehicles, instability due to rapid change of global money flows, and other issues which have led to the current problems, and where have we landed? Evil CEOs making too much money.

No, this has almost nothing to do with the current crisis. But it sure is comforting to focus on a few scapegoats and decide they must be punished for our collective sins. This is the way it’s always happened, and always will. It’s a lot easier to personify your problems and blame them on others than to face up to the fact that the entire system developed flaws.

If you dig deeper into the roots of this problem, you discover it’s a lot more complex than, “there wasn’t enough regulation”, or “CEOs are out of control”. You discover problems that are a lot more difficult to deal with, and/or require fixes that might not line up with your own personal ideology.

For example, one of the things that contributed to this bubble was the rise of the Asian economies, particularly in China and India. This flooded the worldwide monetary system with a whole lot of new money. China in particular has adopted a state policy of high savings rates. And high savings rates require places to put the money. This caused a flood of Chinese dollars into the world financial markets, which made capital cheap and easy. That in turn drove innovation in finding new ways to invest this money. Cheap money lowered interest rates, which stimulated the housing boom.

In the meantime, the rapid growth in financial networks and powerful computers gave financial people the ability to more sophisticated modeling and the ability to make much more complex financial instruments and financial deals (See: The Formula that Killed Wall Street for a different angle on the crisis).

Was this a failure of deregulation? Certainly the partisans on the left want to paint it that way. But you could just as easily say this was a failure of regulation - after all, there are plenty of regulators in the financial system who weren’t sounding the alarm, and in fact were doing everything they could to make the problem worse. Fannie and Freddie are not the sole cause of this, but if the problem was just with free markets, and governments were the answer, then you would have expected these very heavily government-regulated financial organizations to have struggled against the tide - to have been a force in opposition as regulators tried to rein in an out-of-control free market. But that’s not the case - Fannie and Freddie were right out in front of this problem, making it worse and pushing financial firms into taking ever-more risks. Regulators like Barney Frank were saying that they were willing to ‘roll the dice’ to help poor people get loans.

CEOs didn’t cause this problem. The financial companies reacted to incentives created by a changing global financial system. They had to, or risk being run over by their competitors. There was a fundamental market failure in information - risks were packaged up and monetized and buried inside investment vehicles in a way that eliminated risk for the people making the risky choices (the banks lending money for real estate, mainly), and spread it across the market as a whole. There’s room here for regulatory reform, based around making sure the risk of financial investments is disclosed to all parties.

[gonzomax]

@Sam_Stone

I get SO tired of people who know absolutely nothing about business making sweeping statements like this.

The company I worked for was bought out by a bigger company. Working for that company, I have been involved in discussions of acquisitions of other companies. It has NOTHING to do with trying to limit competition or corner the market. It’s more about strategically placing your company in a certain market.

For example, let’s say you make automation controls for factories. You have very good hardware, but you have a gap in your product line - you don’t have good management or HMI software. Your competitors may have inferior hardware, but their combination of hardware and software is causing customers to choose them.

So you know you have to come up with your own software solution. You do an analysis of what it will take to make your own, how long it will take, how much sales you will lose while it’s being built, and you compare that against the cost of acquiring a company that already makes the kind of software you need, or perhaps entering into a strategic partnership with them.

It’s all about strengthening your product line and filling gaps. And if you think it through, you’ll see that this can be a good thing for the economy as a whole. For example, if the company decides to make their own product, then they are going to be competing against the existing company for the same market, and suddenly you have an oversupply of capacity.

Companies that do acquisitions will often, and at the same time, divest themselves of other branches of their company. It’s not about ‘taking over’, it’s about maintaining the alignment between the needs of the market and the strengths of your company. GM will acquire part of Subaru, then divest itself of SAAB. GE tries to get rid of appliances, but buys a company that makes wind turbines. Companies are dynamic, evolving entities. Or if they aren’t, they go out of business.

I find it amazing that so many people are willing to invoke all kinds of conspiracy theories, weak correlations, or outright fictions to paint a picture of corporate America as somehow controlling their lives, and then using that to justify giving more power to the government, which has as its sole purpose the ability to directly control people’s lives, including a sanction on the use of force if need be.

Stories of political corruption are ignored or dismissed as the problem of bad individual politicians (or hyped if it’s the party you don’t like being caught). Demonstrated governmental failures like Fannie Mae and Freddie Mac are ignored. 55 trillion dollars in pension shortfalls by government managers are swept under the rug while a much smaller loss of capital in the heavily controlled financial sector is used to ‘prove’ that capitalism is an utter failure.

People still advocate price controls and trade tariffs, despite their being almost universal agreement among economists that these are destructive policies. In the 70’s, the government’s answer to high gasoline prices was a price control on gasoline - which immediately led to shortages and lines at gas pumps. Government’s response to high rental rates in New York was rent controls - which has done tremendous damage to New York real estate and affordability. And now you want to control CEO wages with price controls. Will you ever learn?

I get so bored with people extrapolating their own experiences into the world market. Will they ever learn? i did not advocate nationally controlling wages. But if we have to take them over ,we have that right. They get billions in tax payer money due mostly to lack of or poor management and oversight. Then we should keep them employed at the same salary? Nonsense. They are the problem not the solution.
Do you think oil company and bank mergers were for any other reason than to control more of the market? Get real.

[Sam_Stone]

As for what Golden Parachutes and other high CEO pay does… The historical reason for the Golden Parachute was to align the incentive structure of the CEO with the incentive structure of shareholders.

The problem with tying CEO pay strictly to quarterly performance is that it’s not always in the company’s best interest to maximize quarterly performance. Sometimes you need to make longer-term investments that will actually hurt you in the short term.

Also, a CEO who only makes make money when the company is doing really well is a CEO who is going to be extremely risk-averse. This was the real problem that led to golden parachutes. From the perspective of a shareholder with a diversified portfolio, you want individual companies within it to take some risks, because risks generally bring higher rewards. If a risk-averse strategy guarantees 1% profit, but a risk-taking strategy yields an average of 5% profit, but with some chance of taking a serious hit, the investors want the risk, but the CEO might not, because a downturn in the company could cost him his job, while higher profit might only increase his salary by a few percentage points.

So, the theory is that by giving the CEO an ‘out’ if things go to hell, the CEO will be more free to act in the best interests of the company rather than in his own best interests.

If you’re going to assign fault here, the rise of these packages probably has more to do with the rise of institutional investors who hold shares of these companies as part of a risk-balanced portfolio, as opposed to private investors who have a grreater personal stake in an individual company. But even that is not necessarily a bad thing - institutional investors might drive more risky behavior in individual cases, but a more optimal level of risk taking across the economy as a whole.

Note that by ‘risks’ we’re not talking about the financial collapse, but the kind of mundane risks like taking a big swing at a technology (i.e. the Chevy Volt), or making major investments in new markets. Not all risk is bad.

[Sam_Stone]

And scapegoating CEOs has consequences:

Crisis Reshaping Wall St. As Stars Begin to Scatter

There is an air of exodus on Wall Street — and not just among those being fired. As Washington cracks down on compensation and tightens regulation of banks, a brain drain is occurring at some of the biggest ones. They are some of the same banks blamed for setting off the worst downturn since the Depression.

Top bankers have been leaving Goldman Sachs, Morgan Stanley, Citigroup and others in rising numbers to join banks that do not face tighter regulation, including foreign banks, or start-up companies eager to build themselves into tomorrow’s financial powerhouses. Others are leaving because of culture clashes at merging companies, like Bank of America and Merrill Lynch, and still others are simply retiring early.

Predictable as rain, and incredibly damaging to the country as a whole.

[IdahoMauleMan]

@Sam_Stone

As for what Golden Parachutes and other high CEO pay does… The historical reason for the Golden Parachute was to align the incentive structure of the CEO with the incentive structure of shareholders.

Perhaps more specifically, Golden Parachutes became popular following the rise of the LBO movement in the 1980’s to ensure a CEO wasn’t standing in the way of a takeover bid that could be potentially valuable to shareholders. In other words, a CEO wouldn’t rebuff strong bids in order to protect his/her turf and fiefdom.

Those early Golden Parachutes were modeled on change-of-control provisions. Lately, of course, they have been modeled on change-of-anything provisions…termination, retirement, even resignation.

The moment of truth is when these things are negotiated and signed. It comes down to when the Board of Directors signs on the dotted line with the new CEO.

What I don’t know, is what the general rule becomes in bankruptcy. Does the CEO stand in line with other unsecured creditors for his payday? Or is the severance agreement walled-off, like it was for Delta Airlines? I suppose if the shareholders don’t like it they can always place an order the following morning to sell their shares.

[Shodan]

@Ocean_Annie

Although this may not be exactly what you want, here are a few specific examples.

I was hoping for a somewhat more serious cite than a cartoon animation.

Undoubtedly, it is a transfer of power from the private to the public, but elected officials, or politicians, have limited authority and exercise the public’s power. Since the government collects revenue to spend on behalf of the public, members of the government are stewards of public funds not self enriching benefactors --they shouldn’t be.

Again, I am not following you. You seem to be saying that wealth ought to be transferred to the government, because they are more incorruptible. Yet the first two examples on your not-terribly-respectable cite were two corrupt politicians - Jefferson and Delay. How exactly does it serve the cause of justice for these two to have even greater access to money they didn’t earn and don’t deserve?

And perhaps you could also explain how the power of government bureaucrats is more limited than the power of private individuals. I would say exactly the opposite is the case - Bill Gates cannot force me to buy his products under threat of imprisonment, but the IRS can do so if I don’t pay my taxes. Therefore increasing the tax burden on the public is a decrease in freedom, not an increase, ceteris paribus.

Regards,
Shodan

[Sam_Stone]

As an example… Every consumer in the United States pays more for sugar than they should. Every Coke in the United States tastes worse than Coke available elsewhere. Why? Because the government has erected tariffs against foreign sugar manufacturers to benefit a small group of politically powerful companies.

These companies couldn’t manage this on their own. Left to the forces of the market, corn syrup faces serious competition from cane sugar. These companies did not cede their power to the government - they used the government to gain power, and to use the government’s ability to use force against the citizenry to bias the playing field against their competitors.

This is far more anti-competitive than anything the free market could have managed, no matter how big those companies are (and they are truly giant companies - Archer Daniels Midland, etc).

Why anyone would think government is the protector of the public against the forces of big business is beyond me, when the entire history of government is a history of protectionism, regulatory capture by special interests, regulation constantly distorted by the lobbying of corporations and other powerful groups, and general incompetence.

Would anyone contend that in societies where government is more powerful and exerts more control over the private sphere that people wind up with more choices? With more freedom to act in their own interests?

I fear that all this talk about control of markets by private industry is a smokescreen. Activists for bigger government aren’t looking to increase choice and freedom - they’re trying to grab the reins of power so they can force THEIR choices on everyone else. They don’t like the choices people make. They don’t like them living in suburbs, they don’t like them driving SUVs, they don’t like them smoking, or listening to Rush Limbaugh, or ignoring the needs of the ‘community’ in favor of their own self-interest.

They don’t want government to level the playing field, they want government to tilt it in their favor.

[Mijin]

@IdahoMauleMan

One of the things that I always find interesting in these posts is the internal contradictions that I see in arguments about government control vs. free markets. As I’ve stated before in other posts, I’ve noticed that there is a segment of the population on the left that absolutely, positively wants no government anywhere near

• Restrictions on same-sex marriage
• Restrictions on abortion
• Restrictions on use of drugs
• Unreasonable search and seizures

and a few other things. The government must stay out. The government cannot be trusted. But yet, the same group usually clamors for as much government involvement as possible in the economy via taxation, trade restrictions, tilting the balance in favor of labor unions, etc. I scratch my head and marvel at what (is to me, anyway) a bizarre internal contradiction.

Sorry, I know this was way back in this discussion but I had to comment.

This contradiction you see in left-wing politics…doesn’t the same contradiction exist on the right, except in reverse? i.e. Unrestricted markets + restrictions on abortion, gay marriage etc.

In fact, arguably the contradiction originates on the right, ever since the libertarians and fundies became inseparable, which I believe was during the reagan administration.
The democrats took the position of opposition in most of the debatable matters, as you’d expect in a two-party system, and voila the contradiction (or implied hypocracy) that you’ve observed.

[IdahoMauleMan]

@Mijin

Sorry, I know this was way back in this discussion but I had to comment.

This contradiction you see in left-wing politics…doesn’t the same contradiction exist on the right, except in reverse? i.e. Unrestricted markets + restrictions on abortion, gay marriage etc.

In fact, arguably the contradiction originates on the right, ever since the libertarians and fundies became inseparable, which I believe was during the reagan administration.

It absolutely occurs on the right, as well. But there are so few of those who regularly post on this Board that I thought I would engage with the left for purposes of discussion.

I would hardly state that the libertarians and the right are ‘inseparable’.

[Whack-a-Mole]

@Sam_Stone

And scapegoating CEOs has consequences:

Crisis Reshaping Wall St. As Stars Begin to Scatter

Predictable as rain, and incredibly damaging to the country as a whole.

Nice selective quoting to misrepresent what is happening here. From your link:

This is certainly a concern for the banks losing top talent. But other financial experts believe it is the beginning of a broader and necessary reshaping of Wall Street, too long dominated by a handful of major players that helped to fuel the financial crisis. The country may be better off if the banking industry is less concentrated, they say.

“If the risk-taking spreads out to these smaller institutions, it is no longer a systemic threat,” said Matthew Richardson, professor of finance at the Stern School of Business at New York University. “And innovation is spreading out too. This is a good thing.”

So where is the “incredibly damaging” part?

They are playing a shell game. They have not left Wall Street. Just shifted Wall Street employers. Sounds fine to me. Some few may go to foreign firms but such high flying opportunities are limited and there is not a shortage of these smart guys to go around.

[Whack-a-Mole]

@Sam_Stone

I fear that all this talk about control of markets by private industry is a smokescreen. Activists for bigger government aren’t looking to increase choice and freedom - they’re trying to grab the reins of power so they can force THEIR choices on everyone else. They don’t like the choices people make. They don’t like them living in suburbs, they don’t like them driving SUVs, they don’t like them smoking, or listening to Rush Limbaugh, or ignoring the needs of the ‘community’ in favor of their own self-interest.

They don’t want government to level the playing field, they want government to tilt it in their favor.

Thanks for telling me what I want. I had no clue. :rolleyes:

I believe government does have a necessary regulatory role. How can you talk about the horror of protectionist sugar regulations and hold that up as somehow equivalent to a collapsed world economy driven by a lack of regulation and proper oversight?

Sure there are dumb regulations, sure there are protectionist regulations. You’ll note however that it is business driving most of this. I do not think many leftie-libruls were pining for protecting the sugar industry. Business wields undue power in Washington and the results are predictable. They whittle away at regulations they find inconvenient, plop in regulations that protect their companies.

These are NOT activists for bigger government at all. These are businesses trying to tilt the playing field to suit their needs. And here you sit bemoaning the people who do not like that seeking “bigger” government.

I do not want “bigger” government. I want a government “of the people, by the people, for the people” and not one that answers only to big business.

[Sam_Stone]

@Whack-a-Mole

Nice selective quoting to misrepresent what is happening here. From your link:

So where is the “incredibly damaging” part?

They are playing a shell game. They have not left Wall Street. Just shifted Wall Street employers. Sounds fine to me. Some few may go to foreign firms but such high flying opportunities are limited and there is not a shortage of these smart guys to go around.

That article is but one of many. There have been several articles in the business press recently about a brain drain on Wall Street, and much of the blame is being put on new regulations and the general scapegoating of wall street execs that’s been going on.

Another blowback is that some banks have been trying to return their TARP money, fearful that being under TARP is going to cause the Obama administration to cap salaries, cancel bonuses, fire executives, etc. In several cases, Geithner has refused to allow the banks to repay their TARP loans, raising speculation that the Obama administration wants as many of these banks on the ‘hook’ as possible so it can exert maximum control.

[Garula]

@Whack-a-Mole

I do not think many leftie-libruls were pining for protecting the sugar industry.

I don’t know much about this specific example, but if you frame the situation in terms of protecting local jobs, perhaps with an element of unfair or unsafe business practices abroad, you’ll get plenty of left wing politicians on board.

[Whack-a-Mole]

@Sam_Stone

That article is but one of many. There have been several articles in the business press recently about a brain drain on Wall Street, and much of the blame is being put on new regulations and the general scapegoating of wall street execs that’s been going on.

Another blowback is that some banks have been trying to return their TARP money, fearful that being under TARP is going to cause the Obama administration to cap salaries, cancel bonuses, fire executives, etc. In several cases, Geithner has refused to allow the banks to repay their TARP loans, raising speculation that the Obama administration wants as many of these banks on the ‘hook’ as possible so it can exert maximum control.

So the banks want to go back to business as usual and the government doesn’t want to let them? Cry me a river.

As for the “brain drain” you claim articles I am reading say it is pretty much bogus. And you did not spell out how the “incredibly damaging” part plays out or even provided evidence for it.

1. They are not the only “smart” people available
2. Generally they are staying on Wall Street, just shifting employers (nothing wrong with that)
3. There is a LOT of competition out there for these high paying jobs and banks globally are in a pinch. There simply are not enough hyper-high paying jobs to go around…these exec’s choices are limited.

To wit:

But it’s hard to argue that Wall Street executives were on their game. After all, a lot of smart people in this business did a lot of stupid things. Traders took foolish risks with tricky mortgage investments, and, for their folly, collected seven-figure bonuses. Their bosses, hoping for big paydays themselves, turned a blind eye to the dangers. And the bosses’ bosses, the folks who actually run these companies, never quite wrapped their heads around all this. As long as the profits rolled in, everyone made money.

Until, of course, they didn’t.

<snip>

“People got spoiled,” Mr. Gutfreund says. As for that brain drain: Not likely, he says. “There’s always someone else coming up the ladder.”

<snip>

So the résumés are flying. One Wall Street headhunter, Gustavo Dolfino, says that back during the bull market, 30 or so bankers and traders would ping him weekly, looking for jobs. Now he hears from 300.

So if a few masters of the universe threaten to leave, where are they going to go?

<snip>

“You might get down to the core group that actually likes finance, and lose people who are coming just for the money,” says David S. Resnick, co-head of investment banking at Rothschild in the United States. If he’s right, that’s sounds like the kind of brain drain we could live with.

SOURCE: Wall Street’s Brain Drain Defense, New York Times, 02/21/09

[Lobohan]

@Shodan

You mean like Enron, and so forth?

Or do you mean that there is no possible way to get around a law, or a tax increase? And tax attorneys don’t earn their living figuring it out?

Regards,
Shodan

There are possible ways to get around many things. I assume you’re for the elimination of all laws, right? Since after all someone might get away with something someday.

Like I say, you’re making a stupid argument. Enron cooked its internal books as I recall and was caught and punished. So I’m not sure how that’s relevant.

Selling things openly isn’t like selling crack. Crack isn’t sold at Walmart or at the mall. It is sold in secret, away from the eyes of the government.

Financial giants can’t sell in secret. They sell on the open market. Where everyone can see them, so yes, punishments are a lot more likely to be handed down than for minor drug crimes. Can you see that your argument is silly now?

[Whack-a-Mole]

@Garula

I don’t know much about this specific example, but if you frame the situation in terms of protecting local jobs, perhaps with an element of unfair or unsafe business practices abroad, you’ll get plenty of left wing politicians on board.

Well…as Sam Stone noted it is the likes of Archer Daniels Midland, a ginormous agribusiness, driving that. Sure they may couch it in “protect workers” language if it furthers their goals but in the end they do it because it is in their interests to do it and not on behalf of the workers.

Certainly some protectionism is driven by a “protect the workers” mentality but in general that is rare. Even today we are hemorrhaging jobs overseas.

Here’s one very recent example. Note they are doing this despite being profitable anyway. Where is this protectionism that protects the workers here?

IBM’s news that it will shed some 5,000 North American jobs and potentially send more positions overseas has stirred up some bad sentiment toward Big Blue as the economy continues to languish.

<snip>

For instance, IBM (which operates its own $59 billion Global Technology/Business Services outsourcing division) saw strong gains in 2008. IBM reported revenue of $103.6 billion in 2008, up 5% from 2007’s $98.8 billion. Income for the year ended Dec. 31 came in at $12.3 billion compared with $10.4 billion, a jump of 18%.

SOURCE: http://www.networkworld.com/news/2009/032709-ibm-layoff-backlash.html